‘The Bank's Guinea Pig’: Mexican Light and the World Bank, 1949–54

This article examines the politics of the Mexican power industry between 1949, when the World Bank made its first major loan to a developing country, and 1954, when the loan project came to an end. By analyzing Mexico's largest power company, Mexican Light and Power, it argues that business history is central to understanding development politics and diplomatic relations. On the brink of bankruptcy and incapable of meeting growing power demand, in 1949 Mexlight received a large loan from the World Bank to expand its generation capacity. The article argues that the Bank's involvement with the Mexican power industry should be understood as part of a broader Bretton Woods project to strengthen private enterprise in the developing world. The article advances an understanding of Latin American postwar development premised on willful integration into US economic structures. The article shows how the Bank's project was successful in building infrastructure to expand generation capacity, but it failed at securing private enterprise a space of economic autonomy free from government intervention. Contributing to discussions on developmental states, it argues that Mexico's private power industry expanded by deepening its reliance on government support.