LAREDO LARGEST US LAND PORT LOGISTICS CONFERENCE SEES BIGGER FUTURE North America's Corridor Coalition
LAREDO, Texas - This key commercial border crossing port for U.S.-Mexico trade appears poised to extend its leadership in U.S. trade with the world as Mexico continues to rise as a top U.S. trade partner and a platform from which U.S. exports also launch to reach all the corners of the world, according to speakers at the 18th Annual Logistics and Manufacturing Conference held here Sept. 21-23 at Texas A&M International University.
Numerous private sector specialists and economic development officials from cities, counties and states in the U.S. and Mexico underscored the current powerhouse role that Laredo, which touts itself as 'The Gateway to Mexico,' plays in the U.S.' increasing trade with the world.
In 2010, total U.S. bilateral trade hit $390 billion, almost completely erasing the historic decline year in international trade of 2009, climbing 24%, the largest-single-year growth since the entry into effect of the North American Free Trade Agreement (NAFTA) on Jan. 1, 1994.
Conference speaker, Ken Roberts, president of the Miami-based trade-tracking group World City, said in a report that in 2010 Laredo, the largest non-sea-based land port in the U.S. processed bilateral trade estimated at $185.3 billion dollars, up 26.9% from 2009.
Roberts estimated Laredo saw $81.2 billion dollars in exports, up 21.6% vs. 2009, while imports through Laredo hit $104 billion, up 30.1% from 2009, as the U.S. economy experienced a powerful recovery surge in 2010 and Mexico Gross Domestic Product soared 5.4% last year, its best output since 2000.
The trade and business development specialist also proclaimed that "Laredo is about to become the first port to reach $200 billion dollars in trade with Mexico," while indicating that the seaport of Long Beach, California is on track to hit that number in U.S. trade processed through it with China, the U.S.' second-largest trading partner.
Roberts said while Mexico trade dominates through Laredo, trade processed from China comes second at $3.1 billion, Malaysia, a key electronics market, is third with $778 million, Japan is fourth with $668 million and Canada follows in fifth place, with $617.24 million processed through the land port.
Meanwhile, other speakers representing the fast-rising industrial Mexican states of Hidalgo, Durango, San Luis Potosi and Chihuahua indicated great changes have taken place that is empowering Mexico to continue to grow its industrial output and economic expansion and growth in coming years.
A member of NASCO, the state of Hidalgo, Mexico, just to the north of Mexico City, at 22 million, the largest metropolis in the Americas, is set to become the natural expansion target of the future of Mexico, Hidalgo Secretary of Economic Development Jose Pablo Maauad told the conference.
He said because land use and population is so dense to the south, east and west of Mexico City, it's almost inevitable that the future growth path of Mexico's capital city will be to the north.
He noted that Hidalgo has the concession for the location of the second major international airport to serve Mexico City and the completion of key, massive transportation infrastructure such as the "Arco Norte," or northern loop from Mexico City's east northwest to tie in to southern Hidalgo state is also driving investments into the state.
Hidalgo's southern industrial region hosts major companies that build the components, locomotives and rolling stock for the burgeoning freight and commuter rail industries serving Mexico, a nation of 113 million people projected to grow to 148 million people by 2050.
The U.S. population in 1956 at the start of the Interstate highway system effort in 1956 was 169 million people.
Antonio Rivas Briones, Director of Investment Promotion at the Durango state Economic Development Department, noted that his state, which sits atop critical freight rail and freight highway connections of the nation's burgeoning western seaports and the northern Mexico territory abutting the USA, is near completing a huge infrastructure effort. This represents the largest single infrastructure investment by any of Mexico's 31 state governments over the last five years.
As a result, Durango by mid-2012 will complete the new over-the-mountains freight highway from the western Pacific Ocean port of Mazatlan to Durango, cutting that trip to three hours driving time from the previous eight and opening up whole new trade opportunities between Mexico's western states and even South America with the U.S. Thus the Mazatlan-Durango-Monterrey to Matamoros national highway will be an almost mirror image for Mexico of the IH 10 highway that links southern Florida through Louisian and Texas and New Mexico with Arizona to California, coast-to-coast.
Durango itself is busy building out the Durango Industrial and Logistics Center, a giant intermodal freight transport facility.
The city and state of the same name are leaders in solar power and in water conservation and recycling. Despite being in semi-arid territory, Durango's advanced water resource policy has secured 50 years of water supply to support the growth in industry. Durango is also the timber center of Mexico, with more forestry resources than any part of the nation.
Dr. Barry Lawrence of Texas A&M University, a specialist in Texas-Mexico trade patterns, told the conference that growing logistics, energy and labor costs in China has strongly induced many companies to reconsider returning to a focus of locating production plants and processes back in northern Mexico.
"The Texas-Mexico Trade Corridor, and all the communities within, is well positioned to benefit," he said.
Despite the high-profile Mexican drug cartel violence and the Mexican government's use of the military to combat heavily armed organized crime organizations, Lawrence noted that "all of Latin America, Africa, Russia, most of Asia, and even some U.S. cities have comparable security issues to Mexico.
"Most markets outside of Europe and North America have higher market risk than Mexico," Lawrence said in his report.
Evidence of the veracity of the comments is that so far in 2011, auto firms such as Japan's Nissan, Mazda and Honda, Italy's Fiat and Germany's Volkswagen have committed to invest over $2 billion U.S. for new auto plants in central Mexico, many of them using U.S.-produced components and modules, and most of the car units to begin being exported from Mexico to the world by 2013.
Even before these investments, Mexico surpassed Spain and Canada to become the world's No. 7 auto power in 2010, reaching a record of 2.25 million cars manufactured, compared to Canada's 2.0 million cars produced in 2010. Most Mexico car production is exported, but Mexico's rising middle class is becoming an ever-larger and enticing domestic car market.
Mexico also has moved ahead of historic leader Canada to become the No. 1 auto parts supplier to the USA new auto production market, the world's No. 1 market by revenues, about 2/3 bigger than the auto industry of China.
Mexico is the No. 3 trade partner of the U.S., but only behind Canada and China. But Mexico buys double the U.S. exports that China does, beginning with U.S. auto components used in Mexico new car production.
Right in behind come cellular phone equipment, transportation vehicles, oil and oil products and farm equipment.
"The purpose of the event is to strengthen the two Laredos (a reference to sister city Nuevo Laredo, Tamaulipas, Mexico across the Rio Grande) as the most important land port customs for international trade," Javier Garza, president of the Laredo Development Foundation, told attendees.
