Persistence, Bribes Got Wal-Mart Into Mexican Town

Wal-Mart has expanded rapidly in Mexico. A report this week delves into how corruption played out in a town, where Wal-Mart was determined to build a supermarket near some ancient pyramids. Steve Inskeep talks to David Barstow, of The New York Times, about his continuing investigation into Wal-Mart's troubling business practices in Mexico.

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STEVE INSKEEP, HOST:

Suppose you run a business, you want to open a store but local zoning laws make your preferred location off limits? If you're the Mexican branch of Wal-Mart, according to The New York Times, you just bribe an official to alter the zoning map.

David Barstow is one of the reporters of the latest Times investigation of Wal-Mart and bribery in Mexico.

DAVID BARSTOW: The town where they wanted to build had just adopted a new zoning plan. They had spent years of work on this plan and that plan very clearly said, you cannot build a Wal-Mart in the plot of land where they wanted to build the store. So what we discovered that Wal-Mart's solution was to pay roughly $52,000 to an official to alter the zoning map.

INSKEEP: So the store got built?

BARSTOW: So the store got built. There were three other bribes that were paid along the way to help this store get built, more than $200,000 and all, and it provoked a very fierce backlash from people who lived in this town who were very upset at the idea of a Wal-Mart barely a mile from these ancient pyramids that are probably the most revered cultural landmark in all of Mexico.

INSKEEP: Why was Wal-Mart so determined to build in that particular place of all the plots of real estate in Mexico?

BARSTOW: When Wal-Mart's real estate executives were looking at this particular town, it was a town that absolutely fit the kind of the Wal-Mart demographics of what they were looking for. They look at this from the air and they saw this field sitting there right on the main entrance in the town and it was for their purposes the absolute perfect spot. They felt like they could slam the gate basically, on the entire town and put it off limits to any other potential competitors. It began to take on a kind of importance within the company, that they could successfully build in this spot so close to these revered pyramids. If they could do it here and outmuscle the protests and the political opposition, they would send a message to all of Mexico, which was basically if we can build here, we can build anywhere.

INSKEEP: Was anybody harmed?

BARSTOW: As you have anywhere Wal-Mart builds, you have complaints from small local merchants, and there's actually a deeper harm in terms of the sense of community and the social fabric in this particular town. It became such a divisive thing it prompted months and months of hunger strikes and protests. There were blockades of the construction site and it remains to this day I think, the most controversial Wal-Mart in all of Mexico.

INSKEEP: Was it an unusual example of bribery, if you looked at Wal-Mart's operations across the country?

BARSTOW: No. We were able to connect specific bribe payments to 19 specific stores across Mexico. And in examining those cases, you do see a pattern emerge where things that were strictly forbidden suddenly are miraculously attainable.

INSKEEP: You know, there is widespread concern about bribery by many companies and involving many officials in Mexico. Is it clear to you that Wal-Mart's conduct, according to your investigation, is worse than the norm?

BARSTOW: The truth of the matter is that, yes, corruption is a significant problem in Mexico. But it's also the case that there are many companies in Mexico who follow the law. And there are also many public officials who were trying to do the right thing but believe deeply in the democratic processes. And so I think it's an error to assume that somehow the entire country, there is a sort of corruption gene in their DNA. It's just not what we found in our reporting down in Mexico.

INSKEEP: David Barstow is co-author of an investigation in The New York Times of bribes paid by Wal-Mart in Mexico.

Thanks very much.

BARSTOW: Thank you.

INSKEEP: And Wal-Mart has put out a statement on The New York Times story, saying its own investigation of the allegations is ongoing, and Wal-Mart has not yet reached final conclusions.

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