Mexicans hope for better urban planning. But decentralization of capital can't occur without debt restructuring

Many Mexicans hope that after the destruction of last week's earthquakes, long-desired reforms such as decentralization of Mexico City might take place. But because of the cost of such reforms, analysts say that substantial reforms can take place only if Mexico's debt repayment terms are substantially altered in Mexico's favor. The debt stands at $96 billion.

``In order to begin to talk about serious decentralization, [Mexico] would have to be excused from paying, at least for one year after the earthquake, the interest on [its] debt, an interest that amounts to between $10 and $13 billion annually,'' says Efraim Caro Razo, an economist working at the Center of Border and Northern Mexican Studies, a Mexican think tank.

``The earthquake has focused public attention on some longstanding problems which have afflicted the country and Mexico City for years. But unless we get some relief from our debt payments I don't think we can expect anything more than minor, cosmetic changes,'' he adds

For the past 20 years, Mexican intellectuals have said that the overconcentration of population, industry, and government in the overcrowded capital has decreased the quality of living for its 18 million inhabitants. Housing, transportation, and general government services have deteriorated; pollution has increased; and price of food has increased. This has affected the development of the rest of the country, much of which remains impoverished. According to one source, Mexicans migrate to Mexico City at

a rate of approximately 1,000 a day.

One way to keep unemployed peasants from flocking to Mexico City is to provide employment in the countryside, say these Mexican intellectuals. This can be done in part by decentralizing government services and industry away from Mexico City. Successive Mexican administrations have attempted to do this since the late 1960s, without success.

Besides the financial costs involved, decentralization creates other difficulties.

There are political problems caused by moving government services away from Mexico City, because, as one Mexican academic put it, ``Everybody wants to be at the heart of things and Mexico City is the heart of things.'' High-ranking government officials moving their offices to the provinces would feel excluded from the center of power.

But some government offices will almost certainly be moved outside of Mexico City, probably to neighboring smaller towns within the region.

This difficulty extends to decentralization for private industry and commerce.

The government used tax incentives to try to persuade companies to leave the capital in the 1970s, but the effort failed because industry wanted to remain close to its main market, Mexico City.

The earthquakes called attention to one of Mexico City's existing problems: the water system.

The earthquakes damaged parts of Mexico City's underground water supply and drainage pipes, focusing public attention on the capital's serious long-term water supply problem.

Mexico City rests 7,347 feet above sea level and is constantly expanding. By the year 2000, it is expected to reach a population of 30 million. Piping increased amounts of water up the mountains into the city is still an unsolved problem.

Public attention has also focused on zoning problems and allegations of corruption in building. Much of the capital's center is built on lake and river areas which were filled in.

The rapid growth of Mexico City, experienced within the last few decades, has forced development in areas that are not particularly suitable for large buildings. Housing complexes rest on landfills and cover mountain slopes.

As Mexico's rural population continues to move into the city, and with scare financial resources, it will be difficult for the government to vacate these areas.

The large numbers of Mexicans arriving in the capital each year who demand new housing also complicates the problem of corruption in the building of housing. Many of the buildings which fell in the earthquakes did so because builders had allegedly not complied with minimum structural requirements.

After last week's disaster there will certainly be a strong attempt to crack down on such corruption. But Mexican analysts believe that this attempt cannot be completely successful until the excessive demand for new housing is controlled by slowing down migration into Mexico City.