By Kylie Madry

SANTA LUCIA, Mexico There is still work to be done with Mexican authorities to smooth over hiccups caused by the government-mandated move of cargo flights from the nation's busiest airport to a farther-away airport, a UPS executive said on Wednesday.

UPS kicked off cargo flights at the Felipe Angeles International Airport (AIFA) - a year-old, military-run airport backed by the country's president - last month, said Francisco Ricaurte, the firm's Mexico and Latin America head, in an interview with Reuters at the hub.

Mexico earlier this year ordered cargo carriers stop operating at the Mexico City International Airport (AICM), pushing them to use AIFA instead in a bid to reduce oversaturation at AICM.

Now that the move is complete, "we have to keep working with authorities and every member of the value chain" to make imports at AIFA more agile, Ricaurte said.

The military heads customs throughout the country, including at AIFA.

"If we have to work under these conditions, we need to come to an understanding so that military authorities can be clear about what our operation needs, and if that means making certain processes more flexible, then doing so," Ricaurte said.

The decree requiring the move was decried by cargo carriers when first published.

"They gave us such a short timeline," said Ricaurte. "As an industry, we told the government what was feasible and not feasible... and we were able to get an extension."

Ricaurte added that U.S. Ambassador to Mexico Ken Salazar met with affected firms to discuss the move's implications, a rare confirmation of the U.S. government's concern over the move.

The decree applies only to flights carrying only cargo, while passenger flights are still permitted to bring cargo to AICM.

Ricaurte said UPS was still using its storage facilities at AICM as well as the depot it jointly operates at AIFA.

When the decree came out, AIFA "didn't have any more storage facilities available," said Ricaurte. "We would have had to build one in (three-and-a-half months), impossible."

AIFA is set to shift some 110,000 tons of goods this year, the airport's director said on Wednesday, representing less than a fifth of what AICM moved last year.

(Reporting by Kylie Madry; Editing by Lincoln Feast)