 Good afternoon, and thanks for being here. My name is Moises Naim. I work at the Carnegie Endowment, I think, in Washington. It's my honor and my privilege to introduce President Peña Nieto from Mexico, with whom we are going to have an open-ended conversation. As most of you speak Spanish, we are going to have the conversation in Spanish. You have, of course, the simultaneous translation equipment in your chairs. President, bienvenido. Welcome, President Peña Nieto. It's a pleasure being with you. Thank you. Some of the questions everyone here is asking, what will happen to Chapo in Mexico? And President Peña is going to give us an answer to that, but this will be at the end, so that you can stay and wait for his answer at the end. Well, President Latin America, which is the main subject matter of this afternoon in Mexico, as well, there are winds of change in the economies, for instance, in Latin America, and winds of change also in politics. Could you tell us a little bit about your vision about these changes that are taking place in Latin America? Yes, it's a great pleasure to have this opportunity to be with you today. And this was the meeting of heads of state of the Latin American region. However, let me talk about this region and how, really, we are going through so many changes in recent years. Latin America, for instance, has been known for now 20, 30 years for being a convulsed region politically and economically. And however, there is no doubt that this is a region of the world with great changes. This is a region of the world which practically 10% of the population lives. And this is also a region in which we can see different variables, variables that are positive for the development of this region. The first variable is politics. The Latin American region countries have been consolidating their democracies. They've been adopting models and political models of transparency, of openness. And today, well, the problems that we were saying in the past are not being seen anymore right now, especially in this region. And perhaps with some very particular elements here, but these are democracies that are now being consolidated. This is, of course, a case in point. Mexico would be a case in point now. The consistent problem that we still have in this region, which is a big challenge, of course, is poverty and inequality. And on the other hand, according to ACLAC data, poverty and extreme poverty have fallen in recent years. And here, I have some figures that I wanted to share with you only on this item of 2012, 2014. In the region, poverty went down from 4% to 28% extreme poverty from 19% to 11%. So the Latin American region has also had growth, a constant sustained growth, higher than the rest of the world. Let me share with you some data on this. And average growth, 2010, 2014, 3.7%. Vis-a-vis growth that has a marked contrast with the European Union is just 1% growth. Countries like Japan, 1.5%. And even the United States, 2.1% growth. Now, these are just some of the figures and data, as well, of the Latin American region, which make Latin Americans such a different region right now, a region which is growing, of course, and a region which is now facing different challenges. The challenges of our times, of course, challenges we're going to be talking about here today. And countries with more consolidated democracies that have allowed for precisely this constant, and especially this very particular feature and characteristic of it being a region of less problems, less crisis, and more development, and more progress being made in terms of the challenges we face regarding poverty and equality in Latin America. Mr. President, could you tell us about Mexico, talk to us about Mexico, especially help us understand the good and the bad Mexico, the Mexico with great potential, the size, the dynamism, the people in Mexico, and the connected to the US economy, of course, different free trade agreements, members of OECD. And many important steps you have taken, the reforms, for instance, you have undertaken. But this is a contrast with the bad Mexico in the newspapers, the cartels, the murder in Mexico, the chapel, and the drug situation in Mexico. Could you help us understand the coexistence of those two Mexicas? Well, let me tell you something, Moises. I think there's only a good Mexico, a good Mexico. But however, we are a country that is not exempt, like any other country in the world, of course, except from having problems, from having our own challenges. And the subject matters. And the topics you have presented, you have discussed, the insecurity, especially in some parts of our territory. And we also have problems. We are a platform for drug trafficking to arrive in the most important consuming market, which is North America. And we do have our own problems, of course. I insist, like any other country has its own problems. However, we are a good country. We are a country that is really differentiated in the region. It is really distinguished in itself because of everything that has been able to accomplish in recent years. The Mexico of today is a very different Mexico. The Mexico we had some 30 years ago, for instance, a very much known, because of the current economic crisis in the past, and also the economic problems that, unfortunately, have made us have so many setbacks in social development, for instance. Nonetheless, today, I think that we have overcome all these very adverse scenarios. Now, something that's really noteworthy here. We have great institutional stability for 80 years in Mexico, for instance. We've had political stability. And since then, we've also had every six years a renewal in the executive branch. And this has been done within a climate of political stability. And we've also consolidated our democracy. And we've given room and space and margins so that the different voices and the different ideologies, as well as the different ways of thinking among Mexicans may be politically expressed throughout the country. And we've stopped living under a regime with the hegemony of a single political party. And we're now open, authentically very open, to a full democracy, a democracy that is increasingly consolidating every day in Mexico. Within this scenario and with democracy, we've been able to reach a great political agreement. This is something that I would really like to highlight here. This was accomplished three years ago when I started my administration, December 2012, yes. And in this case, together with a participation of the different political forces of my country, we're able to establish an agenda of changes and agenda of transformations. And this had been postponed for many years. The topics that I remember that were being discussed in the electoral political campaign of 2012 that I participated in, where I became the president of Mexico, all these are topics that were unthinkable in the past. We never thought they would materialize. These were reforms and structural changes. That, today, are a reality. And this, undoubtedly, of course, gives us a condition of greater strength vis-à-vis this scenario of the world of high volatility uncertainty and also risk aversion. And the face of the scenario, Mexico is better prepared. And the reforms are not in theory. Reforms are not just saying the benefits eventually. And, actually, there are going to be benefits, even more benefits, as the implementation reforms mature. But, right now, we are seeing very important benefits. Let me just tell you about some of the variables that are showing this condition that I'm talking about. Last year, for instance, in Mexico, we broke record of the number of jobs generated. Over 1.8 million jobs created in Mexico. This is the highest figure of jobs generated in Mexico. The unemployment rate, which is low in Mexico if we compare it to other countries of less than 5%. And we were able to have the lowest inflation rate ever in the history of Mexico since inflation is being measured, and this is 45 years now, 2.13%. And these are, therefore, indicators that are showing the strength of our country. And consumption, domestic market is also moving. And if we add the fact that we are a country with a privileged geographic condition and position-report of Latin America and also North America, we are the bridge between these two regions of the world. We are proud to say that we're Latin Americans. But we also have endowed integration with North America. Our main trade ally is the United States, of course. We have trade with North America of over $520 billion. And on the other hand, this is growing. The reforms we've implemented, we have them political in the political arena and also in what society is going through right now. And we also have reforms at the economic level. And let me also say something about at least three reforms that undoubtedly give us this armored characteristic in the face of the world situation. We have energy reform, for instance, that is breaking away from the model Mexico had in the last 50 years. And we are opening the energy sector, yes, rotation of our underground resources, hydrocarbons, for instance. And the energy sector, the electric energy sector, we are promoting competition. So this will benefit users. Users will be benefited. Society at large will benefit install. This input may be acquired under better conditions at lower prices. And the same for the families, as for businesses and the industry. And the telecommunications reform opens this sector to greater competition so that we may supply telephony, mobile, fixed telephony services, internet services, to increase our situation of competitiveness, especially through all this means. And the financial reform as well. This financial reform is the scaffolding process. And it is really highlighting a need we had. Although we did have a financial system as the one we have, which is a robust system. Undoubtedly the credit level we had in our country was still well below the level of other economies. And today the credit level in Mexico is growing. We went from having a credit level of about 25% vis-a-vis the GDP. Now it is about 32% vis-a-vis the GDP. And the credit level is also growing at higher rates than the economy. I'm talking about 3.5%. Well, in this consistency, we are going to be very close at the end of my administration 2018. Very close to reaching the goal we have set out to accomplish to reach credit levels of about 40%. This is what is happening now in Mexico. This is the armoring process we have in Mexico, the structural reforms that give us more solidity, and soundness, and better preparation to face challenges. And so that we can, of course, face this very convulsed scenario in the world. Yes, President, you know that people were really supporting you. People were welcoming all your reforms. But at the same time, there's concern on the sustainability of those reforms you've launched. The energy reform is the case in point, Mr. President, with the fall of oil prices. For instance, people are wondering if that is going to be undermining the viability of your energy reforms, Mr. President. Well, this dialogue gives me the opportunity to give you more precise information of the path, the route, the path that we have set out to accomplish from here till the end of my administration in 2018. First of all, preserving our strength and our macroeconomic fundamentals. This is our main priority, maintaining this condition. Second, implementing the due and efficient implementation of the structural reforms among them. And let me mention the energy reform. And we have set out, and we are very clear on this, beyond the juncture of this scenario of the fall in oil prices throughout the world, we are resolved and determined to implement, in a timely manner, the energy reform. This has been very successful. We've had different rounds, round one. The different bidding processes that have taken place have been quite successful. Let me just tell you that in December, the 25 fields that were included in the bidding process, they were fully placed with the offering of the participating companies, the national and the foreign companies as well, over and beyond the expectations we had. Now we have the following bid of round one, which would be the one that has to do with deep waters. And I believe that towards the second semester of this year, we are opening the information data. The data room is now open for those companies that will eventually be participating in the bidding process. But I insist, beyond this juncture, well, I can assure you that we're determined to implement the reform and to accomplish the implementation of this reform. Obviously, it will be the responsibility of the regulating institute, the regulating commission that will be deciding the aspects on the bidding of these fields, because it has to be under conditions of advantage and benefits for Mexico. But the fact we now have low oil prices right now does not prevent us, does not limit, does not stop the implementation of the energy reform in Mexico in the corresponding stage that we should be implementing. Another threat for the reforms is, of course, all the wins that are against all the countries from the world economy, of course. It's easier to reforms when you have an economic boom than when you're having economic problems. The emerging countries are now facing very turbulent waters precedent. And Mexico belongs to the emerging countries section. But you say that Mexico is better positioned than the other emerging countries to face up to this difficulties. Could you explain? Yes, well, look, I would like to reiterate what I have already said, Moises. I think the strength of Mexico is precisely, well, first of all, the fact that in a very timely opportune fashion, we've made decisions precisely preventive decisions regarding government expenditure without really knowing which was going to be the horizon vis-a-vis the raw material prices, especially oil prices. With also in a very timely position, 2015, we decided to take preventive measures to cut our expenditure. And we have kept this scenario. We are maintaining it with the commitment of maintaining this exercise in a multi-annual fashion to increasingly reduce deficit in Mexico and thus be able to have less expenditure beyond any scenario that we might have at the international level. With the purpose of maintaining our macroeconomic strength. And this fundamentally depends on having a responsible public finance management in our country, highly respectful of the monetary management done by the central bank of our country. Now, on the other hand, another very important condition, another reason for our being better prepared is that we've done our structural reforms in a very timely manner. This gives us this solidity. And I think the elements I've given you in terms of employment, inflation, and also the domestic consumption we have in the performance of our economy. Well, this all shows, and they bear testimony, a very faithful testimony, timely testimony in how this very adverse scenario that we have in the world, even under those circumstances, Mexico is moving forward, it's still growing. When we see, on the other hand, in other countries' economic slowdown, but in Mexico we are growing, we're not reaching the desired levels, of course, but undoubtedly our economic growth is a big contrast with the growth of other parts of the world, particularly the Latin American region. And of course, this also constitutes great strength for Mexico. I'm talking about our integration with North America. I insist our main trade partner is the United States, and we are now working to accomplish a greater productivity in the North American region. And we are also in a very joint manner with the U.S. administration. We're establishing mechanisms for better logistics for the trade exchange that we already have now. We've implemented a pilot plan for the pre-clearance and customs of the United States and also our country. This is a project, a pilot program for three customs, two are already operating. So our trade will be more agile, more efficient, and this is part of the agreement that we have signed and that we have made with the United States. Of course, there we see great strength. And I think the free trade agreement that we've signed with the United States and Canada now our participation is well in the TPP, which is already going in the stage of being signed and passed by Congresses. But it's strong countries that are part of this great free trade agreement between America and the Asia-Pacific region. And undoubtedly, this gives us a horizon of great potential and greater strength in the face of this such a rapidly moving sea that the world is going through. Yes, Mr. President, you've gone through a very complex stage with a lot of surprises and certain turbulences. Now, what do you know now that you didn't know when you took over the country? Well, I think being in the presidency has undoubtedly given me the opportunity to see and feel in a more direct fashion the great strength of Mexico and the great potential of Mexico. And I can now know better the different regions of the country. And I can also see on the other hand this great renewed spirit in the Mexican youth. Let me also tell you that more than half of the population, practically half of the Mexican population, mainly very young people, youth, 27 years of age is an average. And now we're seeing in entrepreneurship of our young people in their capacity, their creative capacity, they're all wanting to participate in productive activities. We can see how they are becoming part of this. That's why the government has already designed mechanisms to fund, to finance different projects for youth without any credit history. They may be able to participate in productive programs. And we're also promoting through what we see in Mexico. We have created the National Entrepreneurs Institute. We're creating the environment to encourage young people to participate and to be able to develop their own projects. And they're being very successful right now. And we are supporting, accompanying this with voices and benchmarks and preferences. A very successful businessman in Mexico that have decided to participate in all these efforts. It is clear that today governing is, we can see it throughout the world, this is not an easy task. This is quite a complex task. We are seeing political scenarios with great convulsions. And however, I do see it, everything with great optimism. Is it with optimism? Because Mexico has shown, and it is also showing itself as a country, that as of these strengths, of these conditions, well, that democracy, where you can put and include the different expressions and visions on the development of Mexico, and you see political plurality in our country, it is therefore possible to materialize agreements. It is possible to reach agreements on what the country needs. For those that are supposing, assuming that democracy and our democratic consolidation is an obstacle for the country to have a scenario of greater development, I believe that these recent years, especially, what we have shown, and what we have shown ourselves, and what we have shown the world, is that we can transform ourselves. We can transform ourselves positively. And this is the path we're on. This is exactly what we're doing. I'm truly a very optimistic person in seeing how Mexico is transforming itself and I see highly promising arising for a country in the years to come, especially as of everything we've built among the Mexican citizens. This is the importance I see. This is the way I see it. I insist I'm not alien from the difficulties today in terms of ruling, governing in a democratic system. And this is our condition. This is our very particular situation. This is a strength, and I'd rather see it as a great opportunity to continue growing in our country. You belong to a generation of heads of state, heads of state ruling with an activated society, a society that is awake, very much awake, and it knows it has more rights and more individual instruments that it may use, social networks, for instance. And the middle class in Mexico is growing in your country. This is a more connected, educated, and well-trained middle class with new demands on the state and the government. One of those demands, Mr. President, is, of course, they renewed tolerance against corruption. Corruption in Mexico, as you know, this is an everyday issue, topic, and this is part of the national, international discussion. People are going out on the streets in Mexico, Guatemala, and Brazil, chilling in many other countries, where there is a new intolerance against corruption. Now, this hasn't been a surprise to you. How corruption has become a topic of social activism that was never present in Mexico before? I think, first of all, that for those of us that have been working in Mexico, well, in terms of the reforms, changes, and political policies we're promoting in my country and the different infrastructure plans we're also promoting and developing, I believe the superpose for all of this, the purpose is for us to generate in Mexico a bigger middle class, and for us to continue generating a Mexico society with better conditions, with better revenues, better income, and more opportunities. And, of course, today there is a society which is fortunately very active with great participation. I believe the challenge is being able every day to have greater empathy between the acting government which is a performing government and demanding society. How do we find this points of encounter and communication and dialogue? And also, how can we really make effective or pay attention, rather, effective attention to many of the demands in our society? In the very particular issue you're mentioning on corruption, I have dared say that from Mexico, not only from Mexico, really, I think this is not only an issue for Mexico. I think this is taking place in many societies and practically of all the latitudes. I think this was a problem of a cultural order. And, however, today I can tell you that I would dare say that this is even, that when we were talking about the structural changes, we are implementing especially to fight corruption in Mexico. And for that purpose we created a national anti-corruption system which is now being consolidated. We still need secondary legislation for it. But it is clearly defined in our constitution, as well as a national transparency system which is also going through the stage of implementation in the country. These are two very important mechanisms of high relevance to fight corruption in Mexico. I think, therefore, that today what we're doing, and this is something that I've said, is we're trying to control the human condition. This is what we're trying to control. We're trying to, this is the taming process. And I've said this before, this is cultural. Perhaps I've said it once. But I think it was rather more of a topic related to human condition. And today, in the face of this demand made by society and rightly so, I believe that it's a matter of establishing more controls. The way we're doing in Mexico, we're doing this in Mexico taming, taming this human weakness that has to be set within the process of an orderly process. And this is what we have opted in Mexico among other important instruments. This is having open governments that are increasingly transparent governments and their performance, their actions, what they spend, the money on, how they're spending, and how much they spend. And accountability, of course, and an anti-corruption national system which sets forth greater controls, not only for the federal branch. Because in Mexico, we have three different government levels, the federal, the state, and the municipal. So that this audit, this inspection models are not just taking place at the federal level. We do have different control mechanisms there. But for this to be permeating, especially where we find greater levels of corruption, which is right at the base of the pyramid, so that we can make sure that there's a system that will be enforced at three levels of government. I'm running out of time as president. We had promised you're going to tell us, are you going to be extraordinary in chapel? Well, on this question, let me first of all tell you that I have made great recognition and acknowledgement of the public security institutions in my country. Because really, what happened was that they were able to re-apply and chapel Guzman. And for us, this was undoubtedly a difficult moment of stress, of tension when he fled, when he escaped from prison for the reasons. And according to the investigation that's taking place on his escape from jail, in terms of the enforcement agencies, we would have to still make those conclusions. But the important thing is that we re-apprehended him. He was one of the most important criminals in the world. He was being sought for throughout the world. And this has been done through the public security areas in our country. It is very clear today, and this is something that I've also said publicly, the Attorney General's office in Mexico, which is the instance responsible for all this. It is now working to continue the process, the due process, according to the crimes that he's being accused for. We are working for extradition. Yes, we are working on this. Of course, this has to go through a process with the Judicial Branch of Mexico participating as well. But the indication of the Attorney General's office right now is to be working and to speed up its work so that as soon as possible, we can extradite this criminal, which is highly dangerous. After this session, I have been asked to let you know that after the session, we're going to have Professor Klaus Schwab and Bono here, commemorating, celebrating an anniversary of the Red Campaign. So I was asked to ask you to please stay seated when we finish the session. Let us conclude the session, President. Let me thank you so much for such an interesting conversation. Thank you, I also am very grateful. Thank you so much for having me. Thank you. Good afternoon.