22 | JUL | 2019
3 million jobs threatened by potential U.S.-Mexico border shutdown
Mexican exporters said this week they were looking into sending their goods to the United States by air freight to avoid a five-mile-long line of trucks at the border - Photo: Jorge Duenes

3 million jobs threatened by potential U.S.-Mexico border shutdown

04/04/2019
19:05
Ivette Saldaña y Astrid Rivera
Mexico City
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The effects of a border shutdown would be devastating for both consumers and producers in Mexico and the United States

A border shutdown such as the one U.S. President Donald Trump has threatened to impose could seriously affect trade between Mexico and the United States, greatly harming Mexico’s maquila industry, upon which more than 3 million jobs depend, as well as USD$195 billion in annual exports.

According to the U.S. Chamber of Commerce, bilateral trade amounts to USD$1.7 billion a day.

Furthermore, the food sector would also be at risk of losing USD$127 million a day in avocado, tomato, beer, corn, and meat exports, according to experts.

Commercial relations between Mexico and the United States showed a trade value of USD$527 billion in 2018, out of which USD$328 billion resulted from Mexican exports while imports rose to nearly USD$199 billion, according to the Ministry of Economy.

Luis Aguirre Lang, president of Mexico’s manufacturing industry chamber INDEX, Jorge Torres, president of the American Chamber of Commerce in Mexico, and Ignacio Martínez, coordinator of the Commerce, Economy, and Business Laboratory at Mexico’s National Autonomous University (UNAM) expressed their concern about U.S. President Donald Trump’s threat to close the border with Mexico, since numerous companies depend largely on trade with the United States.

“The consequences of a border shutdown could be quite serious and would likely force companies to halt their production lines,” said Aguirre Lang, adding that a company from the automotive sector was forced to halt a production line yesterday because it was unable to receive imported supplies on time.

Mexican exporters said this week they were looking into sending their goods to the United States by air freight to avoid a five-mile-long line of trucks at the border caused by the Trump administration moving federal agents away from customs checks to immigration duties.

Auto parts and medical equipment makers were among the Mexican companies considering the more expensive air cargo to avoid incurring penalties for late delivery to U.S. clients or factory closures, Luis Aguirre said late on Wednesday.

Plan B?

Gerardo Tajonar, chairman of Mexico’s National Association of Importers and Exporters (ANIERM), said that a plan B was in place to mitigate losses in the event of a border shutdown, adding that companies would use maritime routes to transport their merchandise to the U.S. as an alternative.

“We’ve been working with some very good ports in the southeast and we are considering the option of transporting the goods directly to Florida,” he stated.

On the other hand, Mario Andrade, chairman of the National Agricultural Council’s Foreign Trade department, warned that the food sector would be faced with a bleak outlook should Trump’s threat be materialized, standing to lose USD$73 million a day in exports and USD$54 million in imports.

The products that could be most affected are avocados, tomatoes, berries, mangoes, lemons, beer, and tequila.

Juan Carlos Anaya, general director of the Agricultural Markets Consulting Group, considered that a border shutdown would have a devastating effect on producers and consumers in both countries since Mexico is the United States’ second largest trading partner.
 

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