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National Action Party (PAN) President-elect Vicente Fox speaks via telephone with Spanish King Juan Carlos in his hotel room in Mexico City Monday, July 3, 2000, as his daughter Ana Cristina sits next to him at right. Fox, a tough-talking former Coca-Cola executive, shattered the governing party's 71-year hold on the presidency in a stunning electoral victory that marked a climax in Mexico's transition to democracy. (AP Photo/Jose Luis Magana)


July 5, 2000


MEXICO CITY (AP) - With a hug and a handshake, the last leader of Mexico's ruling dynasty and the maverick rancher who will succeed him embarked on Mexico's first peaceful transfer of power in modern history.


A day after Mexicans voted out of the presidency the party that has governed them since 1929, Vicente Fox strode into the presidential residence known as Los Pinos on Monday evening to discuss the transition with President Ernesto Zedillo.


The contrast couldn't have been starker: Zedillo, a 5-foot-7 (1.70 meter) bookish, Yale-educated economist, and Fox, a 6-foot-5 (1.96 meter) tough-talking businessman who rode into one of his final campaign rallies on horseback.


But the two said they would work together to ensure a peaceful transition from 71 years of rule by the Institutional Revolutionary Party to the next six in which the National Action Party will hold the presidency.


The two even agreed to work together on the 2001 budget proposal, which Zedillo must submit to Congress just as Fox takes office on Dec. 1.


"We have some clear ideas about next year's budget ... but, on the other hand, there is a need to take advantage of the government's experience," Fox said after the meeting.


Fox applauded Zedillo, first for recognizing Fox's victory only three hours after the polls closed, and then for his eagerness for a peaceful transition.


"We had expected more difficult scenarios," Fox told reporters. "We have to acknowledge President Zedillo. His performance will remain registered in history."


Fox also began to plan the transition on his own, saying he would send out head hunters to find the most qualified people for each top post, regardless of their party affiliation. He said he would personally interview the top three candidates for each Cabinet post.


"I'm not showing up to govern with friends or relatives or buddies," he said in an interview with The Associated Press. "I'm showing up to govern with the most professional team there is in this country."


Fox's relations with other parties could be an important test for his presidency. The officials with the greatest experience in governing Mexico are almost all members of the ruling party. It is not known how many would accept Fox's invitation to join his Cabinet.


The signs of cooperation with Zedillo were likely to reassure investors that the presidential handover wouldn't plunge Mexico into economic crisis, as the last four handovers within the ruling party have.


"That won't happen this time," Fox said.


Fox's overtures to investors Monday appeared to be working. Mexico's stock market closed up 6.1 percent, and the Mexican peso rose sharply against the dollar.


The election was so stunning that many Mexicans don't know what to expect. No one alive has seen a peaceful transfer of power between parties in Mexico. Before the PRI began governing in 1929, Mexicans endured a long series of rigged or violent changes of power by earlier regimes.


The PRI is often confused with Mexico itself, especially in rural areas. It has a political monopoly on the colors of the flag, and for a long time there was no difference between the government and party.


Fox's National Action Party, founded in 1939, was considered a fringe party of the Roman Catholic middle classes for its first half-century, and didn't elect its first governor until 1989.


But with 93 percent of the vote counted from Sunday's election, Fox had 42.7 percent, the ruling party's Francisco Labastida had 35.8 percent and Cuauhtemoc Cardenas of the Democratic Revolution Party had 16.5 percent.


U.S. President Bill Clinton called to congratulate Fox and issued a statement calling the elections a "vivid testimony to the depth of the democratic commitment of the Mexican people."


Former U.S. Secretary of State James Baker, an election observer, called it "a truly historic sea change in the politics of Mexico."


"It can't mean anything but good in terms of U.S. interests," Baker said in an interview.


In addition to the presidency, National Action also appeared to have captured the largest delegations in both the House and the Senate, although it was well short of a majority in both. The party also wrested the governorship of Morelos state away from PRI and kept its hold on Fox's Guanajuato state. Democratic Revolution won the mayor's race in Mexico City.


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