Moving commercial shipments faster in both directions is key to improving IMMEX maquiladora economic performance
A new initiative.
In early May, IMMEX maquiladoras and US and Mexican Customs initiated a pilot program for the purpose of identifying areas in which improvements can be made to speed up the crossing of merchandise back and forth across the heavily transited border between Mexico and the United States. The objective of this undertaking is to increase overall maquiladora industry competitiveness by cutting the costs associated with executing the commercial movement of both inputs and finished goods.
National Maquiladora Association (INDEX) is on board
Federico Serrano Banuelos, president of Mexico’s national maquiladora association (INDEX), has expressed that his organization is committed to working hand in hand with Customs authorities on both sides of the border to deliver a successful result. INDEX has a membership of more than 1,200 export production facilities located throughout the entirety of the country.
Actions that will be performed in the pilot program include:
- The analysis of current border crossing conditions and processes in order to subsequently propose measures that will enable IMMEX maquiladoras to transit U.S.-Mexico shipments of merchandise within an abbreviated period of thirty minutes in both directions.
- -The identification of bottlenecks that exist in each of the steps that are required to move IMMEX maquiladora shipment trade flows. Such bottlenecks will be identified, in great part, through the installation of GPS devices in commercial conveyances that traverse the border carrying material inputs, machinery, and manufactured goods.
All parties involved with the initiative agree that moving IMMEX maquiladora merchandise in both directions faster and more efficiently will be beneficial to all segments of the industry supply chain, as well as to the industry as a whole.
Large volumes of goods
In 2015, of the approximately three hundred and eight billion dollars of exports sent to the US, more than one hundred and ninety-nine billion dollars worth of the items that were crossed into the country moved through northern border land crossings. On the import side of the ledger, IMMEX maquiladoras received one hundred and eighty-six billion dollars of equipment, components and material inputs. Of this amount, one hundred and thirty-one billion dollars worth of goods made entry via north to south land crossings between the two nations. Given large trade volumes, the expediting of these shipments is of paramount economic importance.
The recently commenced IMMEX maquiladora pilot program is slated to be one year in duration, and will take place at select border crossings. Among the ports of entry that have been chosen for testing are:
- Ciudad Juarez
- Nuevo Laredo
The president of INDEX, Serrano Banuelos expressed that, at present, border crossing times for IMMEX maquiladora shipments typically run between two and a half and three hours. Studies that have been done by Princeton’s Woodrow Wilson Institue estimate that the cumulative cost of a one hour delay in transiting all goods from IMMEX maquiladoras between the United States and Mexico can reach a value of four hundred million dollars. This represents a significant drag on competitiveness and underscores the need to conduct the pilot project with the goal of achieving concrete and lasting measurable results.