Energy, immigration policy on Bush-Fox agenda

In this story: Immigration policy change? Drug trafficking report card Much symbolism in trip RELATED STORIES, SITES

(CNN) -- When U.S. President George W. Bush on Friday visits the central Mexico ranch of President Vicente Fox, both leaders will have economic cooperation as their No. 1 priority.

The White House has billed the seven-hour meeting near the village of San Cristobal as a "getting to know you" visit, but the two men met previously when they were both governors.

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"Some look south and see problems. Not me. I look south and see opportunities and potential," Bush said during a speech Thursday at the U.S. State Department.

Mexico is second to Canada as a U.S. trading partner.

The California power crisis has added urgency to a Bush goal of creating more cooperation on energy production and sharing, including new transmission lines and pipelines across the border, and U.S. help in boosting Mexico's abilities to produce and export more electricity and natural gas.

But officials in both governments cite a litany of legal and political obstacles, and U.S. officials suggest immediate breakthroughs are unlikely.

"I'm quite certain they will talk about how to capitalize energy development in Mexico," said a senior U.S. official involved in the discussions who spoke only on condition of anonymity. "But precisely what form that takes and what that means for types or levels of investment, I think they (the leaders) have to talk about it. And President Fox really has to take the lead here. ... It is not our role here in the United States to tell him how to structure the Mexican economy."

Immigration policy change?

"The United States can benefit from the work and the effort of the Mexican people as much as we Mexicans can benefit from working with the American market, with American investors," said Fox.

Fox is seeking an open border policy and amnesty for the more than 3 million Mexicans now living illegally in the United States.

Bush opposes those ideas, but he is eager to work with both Mexican officials and the U.S. Congress on a new program for migrant workers under which Mexicans would be given one-year work permits.

A key player in the debate, Republican Senator Phil Gramm of Texas, said he favors allowing the permits to be extended up to five years in some cases.

"When they are through with the program they go back to Mexico, and they will take the skills they have acquired, they will take the money they have saved and it will give them the ability to help build the Mexican economy," Gramm said.

Under such a program, those taking part in it would be covered by U.S. wage and other workplace laws, and allowed to create savings programs in the United States.

Supporters believe that approach would significantly reduce the incentive to enter the United States illegally -- and reduce the incentive for U.S. employers who are desperate for workers to hire illegal immigrants.

Drug trafficking report card

On the eve of Bush's visit, Gramm co-sponsored legislation to smooth another trouble spot between the two counties. It would allow Bush to waive the yearly counter-narcotics certification for Mexico.

The illegal drug trade is a $63 billion-a-year industry in the United States, and the government estimates that half of the drugs enter the United States through Mexico.

Current law requires an annual report card from the White House on Mexico's progress -- or lack of it -- in the war on drugs. This is a major sore spot in bilateral relations; Mexico considers the law insulting and argues that the problem is more one of demand in the United States for drugs that come through Mexico.

Bush is among those who believe the certification process has proven ineffective in the international drug war, and also is among those who believe Fox should be applauded for a commitment to crack down on drug-related corruption in the Mexican government.

There are several proposals in Congress to end, or at least suspend, the certification process.

Sen. Christopher Dodd, D-Connecticut, predicts Congress will suspend the requirement for two years.

"And that opens up a window for President Bush and President Fox and those in the Congress who are interested to come up with a new framework for how we deal with the very important issue of narcotrafficking," Dodd said in an interview with CNN.

Sponsors of the latest proposal believe law enforcement will improve under Fox, who took office last December ending seven decades of one-party rule and vowing to root out corruption.

"He has shown with his action that he is in the process of doing this ... I'm prepared to give him time to make changes," said Sen. Dianne Feinstein, D-California, another co-sponsor of the proposal.

Fox has fired 45 of the 47 Mexican customs supervisors along the border, a sign he meant business, the senators said.

Much symbolism in trip

More than anything else, U.S. officials describe the trip as a reflection of Bush's commitment to elevate the importance of U.S.-Mexican relations.

Others suggest his familiarity with the issues from his days as Texas governor, and his existing relationship with Fox, make it a logical choice for the new president's first steps onto the world stage.

"There have always been issues that divide the two countries," said Riordan Roett, director of the Western Hemisphere program at Johns Hopkins University. "And we really haven't had a president in many, many decades who has really made the point of saying, 'I want Mexico to be a very close and special ally of the United States.'"

CNN Senior White House Correspondent John King, The Associated Press and Reuters contributed to this report.

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