Interdependence is the way business gets done in the 21st Century economy, and this is especially clear in the border region, where events on one side of the border impact the other.
Through systems of co-production, the U.S. and Mexico are interdependent for manufactured goods, linking the productivity and competitiveness of communities on both sides of the border and beyond.
A prime example is the cooperation between El Paso, Texas and Ciudad Juárez, Chihuahua. These sister cities helped start the first maquiladoras, factories at which parts are assembled in Mexico for export purposes. Ciudad Juárez boomed with the arrival of these factories, first doing simple tasks like sewing jeans, but now thriving in much more advanced industries like aerospace, electronics, and auto parts.
El Paso and the U.S. benefit from this growth as service providers offering legal, financial, and logistical support to industry. The defense, healthcare, education and tourism industries in the El Paso area have all grown to become key sectors in the border economy.
Further south, Laredo is the busiest commercial port of entry on the U.S.-Mexico border, serving as the primary gateway for U.S. trade with Mexico. The massive flow of manufactured goods and parts through the region offers significant opportunities for local suppliers and the burgeoning logistics industry. This opportunity exists both along the I-35 corridor and also further down the Rio Grande Valley, where there are already numerous medium-sized sister city pairs with important manufacturing clusters that are ripe for further expansion.
Obviously, smart trade relationships and policies are indispensable to North America’s economic growth. Many in the U.S. look at the U. K’s June 2016 Brexit decision through the lens of the North American Free Trade Agreement, a commercial agreement for geographically close nations designed to facilitate economic cooperation. There are parallels, but the view vastly misunderstands the intrusive nature of the E.U.
In the wake of the Brexit vote, the NAFTA nations face a choice: 1) mimic the U.K. and turn inward, limiting economic progress and growth; or 2) seize the opportunity to enable greater North American economic growth by making trade more efficient – without succumbing to the economic drag fostered by the E.U. bureaucracy.
For over a decade, TBC has urged investments in reducing the bottlenecks to trade among the NAFTA nations. By improving our land border crossing infrastructure, upgrading the technology that make customs clearances more efficient and hiring the inspectors needed to minimize the hours-long backups at the legal POE’s, we would encourage greater economic growth from legitimate trade and travel.
These investments in international trade will help grow the $22 trillion North American economy that already outsizes our European and Asian competitors. The benefits of NAFTA commerce accrue to every state of the U.S.
Improving our border crossings would not only benefit American jobs and wages, they would also add to border security. As discussed at length earlier, the overwhelming bulk of illegal heroin, methamphetamine and cocaine that fuels the international drug cartels enters the U.S. through the legal Ports of Entry. The scourge of the drug epidemic is impacting rural, urban and suburban communities across every state.
Helping the American economy, jobs and wages grow by fueling our partnerships with Canada and Mexico would also send a message to the world that North America is the powerhouse of the global economy now and in the future.
The leaders of the Texas Border Coalition have no intention of falling into the inward looking, isolationist trap that appears poised to swallow our European competitors. We urge our state and national leaders to take advantage of the opportunity to boost North American economic growth, jobs and wages while helping secure the border.
Finally, for over a decade, TBC has led a coalition of merchants and customs brokers from Brownsville, El Paso, McAllen and Laredo in helping reform the state system of “manifestos.” Manifestos are “proof of export” forms that the Texas
Comptroller’s Office provides to customs brokers so that foreign buyers can obtain sales tax refunds – as required by the U.S. Constitution.
Editor’s Note: The above essay is the fourth in a four-part series focusing on a new 20-page policy paper issued by the Texas Border Coalition. It is titled, “Policies and Proposals by the Texas Border Coalition to Advance a North American Century.” Part Four focuses on Economic Development (above), Health, and Workforce Training and Education. Click here to read the Health essay. Click here to read the Workforce Training and Education essay.
The Rio Grande Guardian has been granted exclusive rights to first publish the policy paper. Click here to read Part One, titled “Texas Border Coalition: How North America can command the 21st Century.” Click here to read Part Two, titled “Texas Border Coalition: A North American Agenda.” Click here (Border Security) and here (Transportation) to read Part Three.