Policymakers seek to expand benefits derived from the sale of Mexican manufactured exports to a wider geography.
Nine states ship the bulk of Mexican manufactured exports to the nation’s neighbors to the north. Four of Mexico’s thirty one states, however, send products whose value represents five of every ten dollars earned by Mexican products sent across the border. These entities are:
- Baja California
- Nuevo Leon
Other volume producers of Mexican manufactured exports destined for US market include: San Luis Potosi, Jalisco, Tamaulipas, Sonora, the State of Mexico, Guanajuato, Queretaro and Puebla. While, in the United States, Texas, California, Illinois, Arizona and Louisiana account for nearly three quarters of all import-export activity with Mexico. On one hand, Mexico is a large supplier of electronic products, computers, and transportation equipment to these states, while on the other Texas is an important shipper of refined petroleum products to its southern neighbor.
A major challenge that the government sees itself facing is that of promoting the shipment of more Mexican manufactured exports to the US from states other than those in positions of industrial and economic leadership.
Although more than eighty percent of Mexican manufactured exports transit its national territory for consumption by its northern neighbor, the percentage of products that originate in two thirds of Mexico’s states is negligible. Last year Mexico sold US $299 billion of its manufactures to the United States, while it imported more than US $187 billion of goods in return. The Mexican government seeks to expand the geographical scope of the benefits that the NAFTA has brought to the country.
A significant portion of the dollar value of Mexican manufactured exports to the US is made up of shipments of passenger vehicles, transportation equipment and auto parts. Toyota and Kenworth both have assembly plants in the State of Baja California, Ford has had long standing and extensive operations in Sonora, while General Motors, Chrysler and Freightliner dominate the sector in the State of Coahuila. The automotive industry is also growing at a healthy clip in the states of Guanajuato, Queretaro and Puebla in a region of the country known as the Bajio.
In terms of Mexican manufactured exports from the electronics industry, companies such as GE, Samsung, Sanyo, Toshiba, Philips, Foxconn, Kenwood, Jabil Circuit, Motorola, Kyocera, Enertec and Sharp ship a high dollar value worth of goods to the United States, and are important suppliers of these products.
The Mexican Federal Government and its investment promotion arm, ProMexico, are undertaking the challenge to increase the volume of Mexican manufactured exports with their origins in states other than those that, today, send the lion’s share of production. According to government and economic development officials the key to bringing this goal to fruition is facilitating and incentivizing the participation of small and medium-sized manufacturers in international trade. In order to do this mechanisms must be devised and put into place to enable smaller producers to access financing on reasonable terms, to earn the quality certifications that will gain them legitimacy among international customers and to raise their profile outside of the domestic marketplace by their products to foreign buyers at trade and industry exhibitions outside of Mexico’s borders.
The source for this post was an article at El Diario de San Luis.