REYNOSA, Tamaulipas – Mexico’s Secretary of Labor and Social Welfare made a number of promises on a visit to the border region on Friday.
Luisa María Alcalde Luján said there would be an increase in the minimum wage, a decrease in the rate of valued added tax to 8 percent for border residents, an income tax (ISR) rate set at 20 percent, and gas prices to mirror those in the southern United States.
“This will allow the inhabitants of the 43 municipalities that make up the new free zone to face challenges and opportunities,” Alcalde Luján said.
Alcalde Luján was with president of Mexico, Andrés Manuel López Obrador, to launch a free zone policy for the northern border. Alcalde Luján said the 43 municipalities included in this program are located in a privileged position thanks to their adjacency to the most powerful economy in the world, one with great consumption.
Alcalde Luján noted that as a whole the border states of Mexico and the United States make up an economic zone interconnected both by the daily flow of people and by production chains that start on one side of the border and end on the other.
“This makes this area one of the most attractive for investment,” Alcalde Luján said.
However, she said that, sadly, this pattern of activity has not meant a reduction in the unequal gaps between the two countries.
She emphasized that through various programs “we seek to close the gap with the country that is not only our neighbor but also our main commercial partner. It is necessary to increase competitiveness and productivity on this side of the border.”
Alcalde Luján spoke in favor of creating the conditions that allow attracting and retaining human capital but also improving the situation and lifestyle on the Mexican side of the border so that compatriots do not have to migrate to seek a better standard of living.
“There are many advantages in this region but so far they have not reached the lower income workers. One of the components of the Free Zone of the Northern Border program offers a doubling of the minimum wage. On January 1, that stopped being a promise and became a reality thanks to an agreement between government, workers and entrepreneurs of the 43 municipalities in this area,” Alcalde Luján said.
Alcalde Luján mentioned that the increase in the minimum wage, going from 88.36 pesos per day to 176.72 pesos per day, has the potential to trigger multiple benefits, such as strengthening the power of consumption and therefore the domestic market, thus benefiting both businesses and workers in addition to more competitive salaries that contribute to informal workers seeking to join the formal sector of the economy.
Editor’s Note: The main image accompanying the above story shows Alcalde Luján, Mexico’s secretary of labor and welfare.
Editor’s Note: The above story by reporter Blanca Zumaya first appeared in Spanish. It was translated into English by Rio Grande Guardian reporter Blanca Gomez.