US Trade with Mexico Doubles between 2009 and 2012
The Yucatan Times reports that Mexico is the United States’ second largest trading partner with about USD 500 billion worth of goods and services transferred across its borders. The outcome is considered to be the result of stronger ties established through numerous visits to Mexico City, five of which were made by President Barack Obama since he took office.
Previously, between 2005 and 2008, only two U.S. governors travelled south of the border. However, more politicians are heading to Mexico City with one goal in mind: money and jobs. By boosting bilateral trade and Mexican investments in the U.S., the former has grown to be the world’s 12th largest economy and home to the wealthiest man in the world Carlos Slim.
Currently, six million job opportunities in the U.S. rely on bilateral trade with Mexico, which doubled since Obama took office to 2009, reaching over USD 535 billion in 2012. Zooming in further, 23 states, including the Dakotas and Iowa, depend on Mexico as their first or second largest trading partner. More also have tips to Mexico on their agenda, including Governor Jan Brewer of Arizona.
According to the governor’s policy advisor on Latin America and Mexico, the governor’s candidates are planning a meeting with President Enrique Peña Nieto and his cabinet. This by itself is big news as Brewer had signed a controversial Arizona state law demanding that local security agencies arrest individuals with foreign appearance about four years ago. Two years after the U.S. Supreme Court struck down most of that law’s provisions, Brewer has turned the page.
Jumping on the same bandwagon is Governor Pat Quinn of Illinois. The state considered Mexico its second largest trading partner, which is why its governor hardly visited Mexico City for over 13 years. However, things are changing as the state now has an active office in the largest North American city to promote its products and agricultural businesses.
Governors Gary Herbert of Utah and John Hickenlooper of Colorado also intend on the same. The latter is even planning to visit Mexico City again in hopes of meeting PEMEX and power company CFE to explore joint ventures in the energy sector.
According to Roberta S. Jacobson, Assistant Secretary, Bureau of Western Hemisphere Affairs, the North American Free Trade Agreement (NAFTA) has contributed to the economies of both countries. “The United States and Mexican manufacturing economies build products together for the North American market and globally. Cultivating this relationship has allowed our citizens to realize one of the key benefits of economic integration – increased competitiveness – that forms the basis for good jobs and prosperity.”
Confirming her testimony are the number listed on the Office of the United States Trade Representative, which show that exports totaled USD 242 while imports were USD 293. Meanwhile, trade in private services with Mexico came up to USD 42 billion in 2012 – USD 27 billion for service exports and USD 15 billion for service imports.
To ensure that the new Mexican reforms continue to benefit both countries, the U.S. has established a High Level Economic Dialogue, which aims at promoting competitiveness and connectivity, ensuring economic growth, productivity and innovation, and striking a partnership to lead both regionally and globally. Many analysts have high hopes of this initiative and expect it to pave the way for a more comprehensive North American partnership that is more comprehensive than NAFTA.
NAFTA countries are integrating into a single economic block after these 20 years, and Mexico has been signing trade agreements with the world´s most relevant economies. Will this partnership catapult the regional growth?