MEXICO. President Joe Biden’s visit to Mexico this week, with a brief stop in El Paso on Sunday, could change the border narrative from chaos to opportunity — at least that’s what local leaders hope.
Once considered a potentially prosperous and dynamic area, the border has instead been criticized as a site of crisis and security threats from the US and organized crime from Mexico, say economic experts such as Raymond Robertson, director of the Mosbacher Trade Institute. , economics and public policy at Texas A&M University.
The region could help North America solve supply chain problems and labor shortages, but is now paralyzed by fear of an “invasion” of immigrants, according to Republican leaders who are blowing up “Biden’s open border.”
At the same time, North Texas investors and community groups in Mexico are increasingly concerned about what some see as attempts by Mexican President Andrés Manuel López Obrador to weaken democracy by trying to nationalize industries like oil and gas and defunding key organizations like the National electoral institution.
However, work along the US-Mexico border could lead to important breakthroughs. “The border is the epitome of the benefits of trade and integration,” said Robertson, senior fellow at SMU Mission Foods Texas-Mexico Center.
“Nowhere is this better expressed than on the Texas-Mexico border,” he said. “There’s a lot going on out there and…politicians are wasting time on political theatrics instead of really capitalizing on this phenomenal opportunity of leaving China.”
As the United States’ relationship with China deteriorates, “Mexico, especially the border, should be the destination for this production,” Robertson said. “I think it’s just absolutely essential for the future of US manufacturing. [and] North American production, so that they find a common language and realize … their common destiny.
The Need for Negotiations in North America
Biden’s visit to El Paso and Mexico City highlights the need for negotiations involving North American leaders, El Paso County Judge Ricardo Samaniego said.
According to him, during the discussions, the border region will be involved in the post-pandemic economy and in the face of an impending recession. The region produces everything from giant wind turbine blades to car parts, medical supplies and laptops.
“The border, in our case El Paso Juarez, really clicks when both sides are talking, resolving issues,” said Samaniego, a former executive at a foreign company known as maquila. “When our leaders, whether in Washington DC, Austin, Chihuahua or Mexico City, are focused on solutions, you reap the rewards here.”
Mexico, the second largest trading partner of the US, is also the 10th most populous country and the 15th largest economy in the world. The two countries are connected, for better or worse, by geography and by strong economic, cultural and historical ties. All this intersects here at the border.
In addition to sharing a nearly 2,000-mile border with the United States, Mexico is a major energy supplier to the US and a major source of illegal migrants and illegal drugs, and the US is a major source of weapons used in Mexico’s notorious organized crime violence, according to US law enforcement and Congressional Research Service.
Two day summit
This week, after Biden’s brief stop in El Paso, the president will join Canadian Prime Minister Justin Trudeau and their host López Obrador, known as AMLO, at Mexico City’s National Palace for a two-day summit.
Leaders will focus on trade, energy, climate change, immigration and border security. López Obrador is expected to promote anti-poverty projects that he says will reduce mass migration heading to the US via Mexico.
The summit opens on Monday with a meeting between López Obrador and Biden aimed at strengthening bilateral trade relations by accelerating border infrastructure projects and expanding cooperation on issues such as “labor mobility, security, education and climate change,” Mexican Foreign Minister Marcelo Ebrard said. .
Energy, telecoms and auto conglomerates are increasingly nervous about doing business in Mexico, pointing to what many are calling López Obrador’s nationalist agenda.
López Obrador has threatened to rip off billions of dollars worth of contracts signed under previous governments. He claims that his predecessors were influenced by corrupt forces and personal benevolence.
Last year, U.S. Trade Representative Katherine Tai requested dispute resolution advice under the U.S.-Mexico-Canada Agreement, saying moves to nationalize some industries represented a setback for North America’s regional competitiveness and energy integration.
In general, the Biden administration says that Mexico favors state-owned oil and energy companies at the expense of US energy companies. López Obrador called his political project the Fourth Transformation of the Country.
Transfer of supply chains from China
Foreign investors are hoping for a breakthrough during the meetings — a key opportunity not just for the US but for North America, said Shannon O’Neill, vice president and senior fellow for Latin American studies at the Council on Foreign Relations.
“The US government is using tariffs, export controls and other trade tools and is spending hundreds of billions of dollars to move supply chains out of China,” said O’Neill, author of the book. The myth of globalization.
“This once-in-a-generation upheaval can and should benefit North America, especially the Texas-Mexico border,” she said. “But just as the region is poised to capitalize, Mexico is turning its back on North America, destroying democracy, ignoring insecurity, and pursuing nationalist policies on energy, food and more.”
Investors and economic leaders in North Texas argue that Lopez Obrador’s policies could have ripple effects throughout Texas. They are overseeing the corn controversy that arose after the Mexican government said it planned to ban imports of genetically modified corn for human consumption and possibly eventually animal feed.
“Immigration, energy and corn,” said Al Zapanta, a longtime Republican and CEO of the US-Mexico Chamber of Commerce in Dallas. “We need clarity on these issues. And we need to gain control of our border.”
Eduardo Marroquín, a longtime energy executive and president of Hunt Mexico, a division of Hunt Oil Co., is now vice president of Grupo Zaro, a trucking company that exports everything from tequila to wine — “almost anything that crosses the border.” rumbling along the Interstate 35 corridor connecting North Texas with Mexico.
“I think, if anything, the summit helps provide some needed accountability,” Marroquin said. “AMLO wants to nationalize all these projects, as well as energy, but it still has to feed the tiger. [Mexican economy] and he has no money for a tiger without investors.”
López Obrador’s administration must curb violence that threatens the country’s social fabric and the security of foreign investors, and unfortunately, foreign companies, including energy conglomerates, often pay organized crime just to operate, he said.
“There are many problems,” he said, “but there are also opportunities.”