Monday, 10 February 2014 00:10
BY KELLY ARTHUR GARRETT
The News
When U.S. Commerce Secretary Penny Pritzker flew home from Monterrey,
Nuevo León, last Friday after five days in Mexico, she had completed
her first international trade mission since being sworn in to her
present post in June of 2013.
“Where better to visit first than a good friend and neighbor?” she told the press during her visit.
The comment was well-received, but there is another, more substantive
motive for the choice: Mexico is the United States’ second-largest
export market (after Canada).
The U.S. exports more to Mexico than it does to the four BRIC
countries (Brazil, Russia, India and China) combined. U.S. exports of
goods (excluding services) to Mexico totaled $216 billion in 2012,
accounting for 14 percent of overall U.S. exports.
Mexico, for its part, sent $277.7 billion worth of goods to the
United States that year, making it the third largest supplier to its
northern neighbor (after Canada and China).
Overall, Mexico is the United States’ third-largest trading partner
(again after Canada and China). Two-way trade between Mexico and the
United States stands today at half a trillion dollars annually, or about
$1.2 billion every day.
That’s a telling figure that Pritzker cited during remarks she made
last week in Mexico City. “To put that into perspective,” she said, a
few minutes into her speech, “about $2 million has been traded since I
started talking.”
A common misconception is that the overwhelming majority of that
two-way trade is concentrated in the border states. The truth is that 22
U.S. states count Mexico as their first- or second-largest export
market.
Secretary Pritzker went out of her way to emphasize that point during
last week’s visit. “For example,” she said, “my home state of Illinois
is the fifth-largest exporting state to Mexico.”
These figures represent huge jumps in cross-border trade since the
North American Free Trade Agreement (NAFTA) opened up trade between the
two countries (and Canada) two decades ago. For example, according to
the U.S. Trade Representative, U.S. exports to Mexico have risen 420
percent since 1993, the year before NAFTA was implemented.
Today, more than 50,000 U.S. firms sell their products and services
to Mexico, and nearly 20,000 U.S. firms have operations inside Mexico.
And Mexico has become the 15th-largest source of foreign direct
investment into the United States.
It’s because of this healthy trade climate — along with Mexico’s
expected solid growth rate and its recent adoption of a series of
reforms — that the administration of U.S. President Barack Obama is
stepping up its efforts to enhance trade with Mexico. Secretary
Pritzker’s recent visit was part of that effort.
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