Everything Duncan Wood said at the City of Pharr's Gateway Forum

PHARR, Texas - Dr. Duncan Wood is an internationally recognized political economist, policy strategist, and expert on U.S.–Mexico relations, North American economic integration, supply chain strategy, and energy policy. He currently serves as the CEO of Hurst International Consulting.

Recently, he gave the keynote speech at the City of Pharr’s inaugural Gateway Forum. It was held at the Pharr Development and Research Center on Dicker Road in Pharr. 

Here is a video recording of Wood’s speech:

Key Biographical Highlights

Education & Background:

* Ph.D. in Political Studies from Queen's University (Canada).
* M.A. from McMaster University (Canada).
* B.A. (Hons) in Politics from the University of Leicester (UK).
* Awarded an Honorary Doctorate of Laws by the University of Leicester for his contributions to international relations.

Leadership & Professional Roles:

CEO of Hurst International Consulting: Advises global firms and policymakers on geopolitical strategy, critical minerals, energy transition, and cross-border trade affairs.

Wilson Center: Previously served as Vice President for Strategy & New Initiatives, Director of the Mexico Institute, and a Visiting Fellow for North America.

Pacific Council on International Policy: Former President and CEO.

Academic Career: Spent roughly 20 years in Mexico as a professor and director of International Relations at the Instituto Tecnológico Autónomo de México (ITAM).

Policy & Subject Expertise:

Frequently gives testimony before the U.S. Congress on North American supply chains, energy security, and geopolitical dynamics.

Serves as an advisory board member and fellow for organizations including the USC Center on Public Diplomacy, Transparency International, and the World Economic Forum agenda network.

Has authored or edited over 12 books and dozens of chapters and policy reports on global relations, geoeconomics, and energy policy.

Publications and Policy Research on US-Mexico trade

Dr. Wood’s research and publications focus heavily on geoeconomics, critical mineral supply chains, cross-border energy integration, and North American trade statecraft. Having spent two decades as a professor in Mexico and serving as the founding director of the Mexico Institute at the Wilson Center, his writing bridges academic analysis with actionable policy strategy.

Key Research Focus Areas

• Energy Sovereignty & Gas Security: Analyzes the interdependence of North American energy systems. His work frequently examines Mexico's reliance on U.S. natural gas exports, pipeline infrastructure across the border, and pragmatic strategies for maintaining grid security during transition periods.
• Critical Minerals & Supply Chains: Investigates North American strategic competition, focus areas for reshoring/nearshoring, and the critical mineral dependencies necessary for renewable energy and industrial manufacturing.
• USMCA / NAFTA & Cross-Border Governance: Focuses on regulatory harmonization, trade facilitation, and cross-border infrastructure along the U.S.–Mexico border.
• The Water-Energy-Industry Nexus: Researches how resource constraints, particularly water stress in northern Mexico, impact nearshoring hubs and industrial growth.
  
  Selected Publications & Policy Briefs
• ”Mexico’s Natural Gas Moment: Security Risk, Sovereignty, and the Case for Pragmatism" — Examines energy sovereignty, natural gas reliance, and supply stability between the U.S. and Mexico.
• "US-Mexico Energy Relations" — Co-authored policy evaluation addressing energy integration, market dynamics, and bilateral policy alignment.
• Addressing Northern Mexico's Water-Energy Nexus Amid an Industrial Boom — Focuses on resource bottlenecks created by rapid nearshoring in northern border states.
• Congressional Testimony & Edited Volumes — Has authored/edited over 12 books and 30+ chapters/articles, alongside delivering expert testimony to the U.S. Congress on North American supply chain security and trade relations.

Congressional testimony

In his testimony before the U.S. Congress (including testimony provided to committees such as the Senate Budget Committee), Dr. Wood has consistently advocated for a strategic, integrated, and security-focused approach to North American trade and supply chain resiliency.

Core Themes in His Congressional Testimony

• Critical Minerals & Energy Supply Chain Vulnerabilities:
• Emphasizes that North American reliance on external non-market actors (particularly China) for critical minerals poses a fundamental risk to economic and national security.
• Recommends building robust domestic and regional capacity within North America—combining U.S. technology and capital with resource processing and manufacturing integration in Mexico and Canada.
• Strengthening Nearshoring & USMCA Rules of Origin:
• Argues that nearshoring into Mexico benefits the U.S. economy, provided that USMCA rules of origin are strictly enforced to prevent non-regional partners from routing components through Mexico into the U.S. market.
• Urges Congress to invest in cross-border enforcement tools to ensure supply chains remain genuinely North American.
• Regional Security Infrastructure & Border Modernization:
• Highlights that physical and digital infrastructure along the U.S.–Mexico border must be upgraded to reduce transit bottlenecks while maintaining secure, non-disruptive commercial flows.
• Stresses the importance of cross-border energy grids, natural gas pipeline infrastructure, and resource resilience (such as managing the water-energy nexus in northern Mexico) to sustain long-term manufacturing operations.
• Strategic Coordination for North American Competitiveness:
• Recommends establishing formal mechanisms for North American economic security coordination, such as joint screening processes for foreign direct investments across Canada, Mexico, and the U.S.

Specific recommendations for the USMCA review

Dr. Wood frames the USMCA Joint Review process not merely as a routine compliance check, but as a crucial opportunity to modernize North American economic strategy and fortify regional competitiveness. Rather than completely reopening the core text—which could introduce high political volatility—he advocates for updating commitments, strengthening enforcement tools, and utilizing binding side letters.

Core Recommendations for the Review

1. Establish a Foreign Investment & Supply Chain Screening Platform:
• Trilateral FDI Coordination: Recommends establishing a North American foreign investment review framework to coordinate the screening of foreign direct investments (FDIs).
• Shielding Strategic Sectors: The primary objective is to prevent non-market actors (particularly China) from circumventing trade restrictions or acquiring strategic assets in key North American sectors like electric vehicles, critical minerals, and advanced tech.

2. Strengthen Rules of Origin & Transshipment Oversight:

• Enforcement Over Reframing: Emphasizes that "rules of origin are only as good as our tools to enforce them".
• Traceability Tools: Calls for expanding joint customs inspections, real-time supply chain data verification, and stricter joint standards to eliminate transshipment, misclassification of goods, and the routing of subsidized components through regional supply networks.

3. Reinvigorate Energy & Critical Mineral Cooperation:

• Structured Energy Mechanisms: Proposes creating a dedicated North American Energy Business Council and integrating energy priorities directly into the USMCA’s North American Competitiveness Committee (NACC).
  
  
• Critical Minerals Framework: Advocates for a regional trilateral framework (or dedicated chapter) setting common standards for sourcing, processing, and building strategic reserves of critical minerals to reduce reliance on external suppliers.

4. Modernize Digital Trade & AI Governance:

• Updating Chapter 19: Calls for expanding digital trade rules to explicitly address cross-border data flows, cybersecurity, and artificial intelligence.
  
  
• Shared AI Principles: Recommends defining joint principles for ethical AI governance, interoperability standards, and regional digital infrastructure security.

5. Close the Gap on Labor Standards & Border Infrastructure:

• Labor Enforcement: Emphasizes translating labor commitments into actual operational standards across all three nations, addressing discrepancies between formal commitments and ground-level action.
• Border Harmonization: Recommends aligning physical and digital infrastructure along border crossings (rail, highways, energy interconnections) and expanding joint preclearance programs to streamline commercial flows.

Recommendations on Mexico's energy and water policies

Dr. Wood emphasizes that Mexico's economic growth, nearshoring potential, and energy transition are fundamentally tied to structural reforms in its internal energy sector and proactive management of its water-energy nexus.

Internal Energy Policy Recommendations

• Pragmatism and Market Certainty:
• Advocates for a pragmatic balance between national sovereignty and foreign capital. He warns that relying solely on state-owned enterprises (Pemex and CFE) strains public finances and starves energy infrastructure of critical investment.
• Urges the Mexican government to provide regulatory clarity and stable rules for private and foreign investors to expand power generation, modern grids, and natural gas infrastructure.
• Natural Gas Grid Expansion & Storage Security:
  • Emphasizes that U.S. natural gas imports are essential for powering Mexico’s industrial base and electricity generation.
  • Recommends expanding internal pipeline networks and building underground gas storage capacity in Mexico to prevent severe economic disruptions during cross-border supply shocks or weather events.
• Critical Mineral Development & Mining Reforms:
  • Recommends revisiting restrictive mining laws and state monopolies (such as state control over lithium via LitioMx).
  • Calls for public-private partnerships to leverage Mexico's significant deposits of lithium, copper, antimony, and rare earth elements into the broader North American EV, battery, and clean-tech supply chains.

Water Infrastructure & Water-Energy Nexus Recommendations

Dr. Wood stresses that northern Mexico serves as a clear example of how water scarcity can bottleneck industrial growth (such as semiconductors, data centers, and manufacturing) if energy and water policies are not aligned.

• Adopting AI & Water-Tech Innovations:
• Recommends deploying smart technologies—such as AI-driven leak detection, industrial wastewater recycling, and advanced cooling systems (e.g., direct-air or liquid-immersion cooling for data centers and chip assembly)—to reduce heavy industrial draw on municipal water tables.
• Pricing Reform and Conservation Incentives:
• Calls for modernizing water pricing mechanisms to properly value water resources.
• Recommends implementing tiered or seasonal industrial pricing signals and market incentives to encourage corporate conservation, while maintaining price protections for vulnerable communities.
• Institutionalizing a North American Water Dialogue:
• Advocates for establishing structured, binational governance frameworks for shared water basins (such as the Rio Grande and Colorado River basins).
• Recommends incorporating joint water management, transboundary data sharing, and watershed resilience directly into U.S.–Mexico trade, climate, and security dialogues.
• Integrated Infrastructure Financing:
• Recommends utilizing innovative financing structures—including public-private partnerships (PPPs), green bonds, and ESG climate finance—to fund long-overdue upgrades to aging municipal and industrial water distribution networks.

Recommendations on manufacturing in Northern Mexico 

Dr. Wood highlights northern Mexico as a "frontline region and microcosm" of the global energy transition." While nearshoring and regional trade agreements like the USMCA have accelerated industrial investment along border manufacturing corridors, severe chronic water scarcity and strained power grids now threaten the region's long-term economic momentum.

His policy frameworks address the specific friction points facing northern Mexico's major industrial hubs (such as Monterrey, Tijuana, Ciudad Juárez, and Saltillo):

1. High-Tech Manufacturing (Semiconductors & Electronics)

• The Challenge: As U.S. CHIPS Act incentives drive packaging, testing, and assembly facilities into northern Mexico, semiconductor manufacturing demands massive volumes of high-purity water alongside uninterrupted electrical power.
• Wood’s Recommendation: Municipalities and industrial park developers must mandate closed-loop zero-liquid discharge (ZLD) wastewater recycling systems, advanced filtration, and strict local water efficiency benchmarks before permitting or scaling semiconductor assembly plants.

2. Green Digital Infrastructure (Data Centers & AI)

• The Challenge: Northern Mexico offers a cost-effective location to host digital infrastructure serving North American markets. However, traditional data centers rely on evaporative cooling—consuming up to 1 million gallons of fresh water per day—and add heavy baseload demands to a fossil-reliant power grid.
• Wood’s Recommendation: Shift digital infrastructure away from evaporative cooling toward direct-air or liquid-immersion cooling technologies. Furthermore, data centers should be required to co-locate with onsite renewable generation or off-grid power generation to avoid overwhelming local municipal electrical grids.

3. Natural Gas Grid Security for Industrial Parks

• The Challenge: Industrial parks across northern Mexico rely heavily on imported U.S. natural gas for power generation and thermal industrial processes. However, the region lacks sufficient underground natural gas storage, leaving industrial supply chains vulnerable to severe weather events or cross-border pipeline disruptions.
• Wood’s Recommendation: Mexico must build strategic underground natural gas storage capacity in northern basins (such as the Burgos Basin) and expand cross-border pipeline interconnections. This creates a safety buffer for manufacturing plants, preventing costly production halts during extreme winter weather or grid emergencies.

4. Industrial Water Management & Binational Governance

• The Challenge: Aging municipal water infrastructure and fragmented water management lead to high water loss across border states, creating direct tension between heavy industrial consumers (like breweries, automotive plants, and electronics) and local residential communities.
• Wood’s Recommendation:
• Modernized Industrial Water Tariffs: Implement tiered pricing mechanisms and market incentives that reward manufacturing facilities for recycling process water, while applying higher seasonal rates during severe droughts.
• Binational Basin Coordination: Incorporate shared watershed management (across the Rio Grande and Colorado River basins) directly into U.S.–Mexico trade, climate, and security dialogues to prevent resource bottlenecks from stalling cross-border supply chains.