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With over $1 billion of trade each day between
the United States and Mexico, our two countries are interconnected
like never before. As a native of the border region, I can
honestly say that nowhere is this more evident than along
our 2,000-mile frontier, where cross-border ties have meant
long-standing and fruitful business between Mexican and American
firms.
With a population of well over 100 million, a fast-growing
middle class with increased spending power, and its geographic
proximity to California, Arizona, New Mexico and Texas, Mexico
is an excellent market for companies looking to increase their
sales. Many firms from the border region already do business
in Mexico: comparing export sales growth between 2002 and
2006, Arizona was up 76 percent to $5.3 billion, California
increased 22 percent to reach $19.6 billion, and Texas jumped
32% to a whopping $54.8 billion -- Mexico is the number one
export market for all three states. By 2006, New Mexico export
sales to Mexico topped $258 million, a remarkable 121 percent
increase over 2002 which made Mexico the state’s fourth largest
export destination.
Now companies in the border region stand to benefit even more
from key Mexican growth initiatives. In July 2007, Mexican
President Calderon unveiled his administration’s National
Infrastructure Plan (NIP) aimed at boosting the country’s
international competitiveness. The NIP aspires to catapult
Mexico into the world’s top 20th percentile for infrastructure
competitiveness by 2030. In addition, Mexico attracted record
levels of foreign direct investment in 2007, making our North
American region more competitive – and increasing U.S. exports
to boot.
The Mexican government will announce billions of dollars
in bid proposals over the next five years for over 300 key
projects. These include new airports and runways, ports and
piers, intermodal terminals, roads and railway lines, environmental
technologies, energy, information technologies, and more.
These projects, to be managed through public-private partnerships
and financing, are expected to generate opportunities worth
nearly $141 billion, with many tenders to be issued in 2008-2009.
The U.S. Mission in Mexico, through its U.S. Commercial Service
staff, is working closely with American and Mexican firms
to help them partner, bid on, and win these projects. The
U.S. Trade and Development Agency (USTDA), working with our
U.S. Embassy in Mexico City, has concluded evaluations and
identified over thirty key near-term infrastructure projects
where U.S. and border region firms are very competitive. These
include:
Seaports. Five new seaports are to be constructed,
and another 22 ports will be either expanded or modernized.
Approximately $6.6 billion in funding from private investors
will be distributed throughout 17 of the projects.
Airports. Three new airports will be constructed
in the Mayan Riviera, Puerto Penasco and Ensenada, and another
31 airports will be modernized—many of these projects will
start in 2008.
Energy Sector. The oil, gas and electric
power sectors are a priority for Mexico, requiring the construction
of oil platforms, power and LNG plants, and deep water exploration
projects. More than $76 billion has been earmarked for up
to 40 projects aimed at boosting capacity for hydrocarbon
production, exploration, refining and production. Electricity
infrastructure improvements require $35 billion in investment.
Environmental Technologies. To increase
the availability of clean drinking water the NIP allocates
$14 billion for 50 projects, including three new aqueducts,
seven wastewater treatment plants, and the modernization of
13 treatment plants in Acapulco.
Highways. $26.6 billion will be targeted
for the construction, modernization, and refurbishment of
nearly 11,000 miles of highways and rural roads all over Mexico
-- over 100 projects are confirmed or in the planning stages.
Information Technologies. All of these infrastructure
projects will require extensive use of information technologies
in the areas of computers, security systems, wireless and
telecommunications networks.
To help U.S. businesses access these opportunities, the U.S.
Commercial Service and USTDA have planned a unique business
development event, U.S. and Mexico: Building Partnerships
in Infrastructure, to be held February 26-28, 2008, in Mexico
City. I will join U.S. Commerce Secretary Carlos Gutierrez
and Acting USTDA Director Leocadia Zak to bring U.S. and Mexican
firms together at the conference, where they can learn more
about the NIP, have one-on-one meetings with key decision-makers
on over three dozen hand-picked projects, and develop immediate
and long-term business in this market.
There will be some amazing opportunities, but let’s take
a moment to look at some companies which already have found
Mexico to be a lucrative market. Tradesur, Inc. of San Diego
is an export management company specializing in the distribution
of equipment for industry, energy, aviation ground support,
and waste management. With help from the U.S. Commercial Service
in San Diego and Mexico City, the firm made its first sales
into Mexico beginning in 2002, and continues to establish
ongoing business relationships with key waste management and
aviation customers. "Now, we're seeing new opportunities
in the area of recycling," says Andres Bonomie, CEO.
"Our firm continues to benefit tremendously from NAFTA,
which has allowed us to be more competitive and has streamlined
the delivery of goods." Tradesur's Export Manager, Pascual
Pinerua, says that exports account for 100 percent of the
company’s sales and supports local jobs at its San Diego-based
office.
Bio Huma Netics of Chandler, Arizona manufactures biological
enhancement products for wastewater treatment and agriculture.
The company benefited from the U.S. Commercial Service’s Gold
Key Service at the Embassy and in Phoenix, which provided
export counseling, prearranged business meetings abroad, and
trade events that substantially increased its sales to Mexico.
Lyndon Smith, the firm’s manager, says, “Mexico continues
to be one of our leading markets, and our export sales there
have contributed substantially to the growth and expansion
of our business.”
Headworks, Inc., of Houston, Tex., specializes in wastewater
treatment technology that screens out solid wastes from the
water as it flows through treatment plants. With its bilingual
representation and help from the U.S. Commercial Service in
Houston and Mexico City, the firm recently made major new-to-market
sales to Mexico. Michele LaNoue, CEO, says Mexico's increased
emphasis on environmental quality is opening new doors of
opportunity for pollution control technologies. "Mexico
is a country of many different markets, so plan your strategies
accordingly," she advises. LaNoue says the firm's overall
export sales, including those to Mexico, have enabled her
company to grow and support new jobs at its Houston headquarters.
Toyotalift of El Paso is a sales and service provider, selling
and leasing U.S. manufactured forklifts. With help from the
U.S. Commercial Service the firm identified key Mexican import
brokers, resulting in new sales to Mexico, a major market
for the company. Mr. Bruce Hoffman, Branch Manager, says Mexico's
continued infrastructure development is spurring growth of
improved logistics, transportation and distribution networks--and
business for his company. "The real key to doing business
in Mexico is building those personal relationships,"
he says. "Not only are U.S. goods highly regarded, but
American firms frequently have a leg up on international competitors
when it comes to reputation for after-the-sales service."
Hoffman says that export sales to Mexico and other countries
have enabled his company to sustain and support new American
jobs at its El Paso headquarters.
Texas Aviation Services (TAS) of Fort Worth, Texas, in business
for 37 years, is recognized worldwide as an industry leader
providing customizing and modifications for new and pre-owned
helicopters. The helicopters are equipped with a variety of
medical equipment, thermal imaging systems, searchlights,
avionics suites, extended instrument panels, custom mounts
and more. With the help of the U.S. Commercial Service in
The Metroplex and U.S. Embassy in Mexico, TAS has been able
to multiply its export sales to Mexico through export counseling,
trade events, and matchmaking programs. Olga Croyle, Director
of Marketing says her company’s strategic location in North
Texas, and the firm’s reputation for service and quality control
has been key to its success in servicing aircraft for Mexico
at its Texas facility, as has Mexico’s growing economy. “Mexico
has a very high use of corporate and utility helicopters and
the country’s infrastructure development has created a boom
at the Toluca Airport, which is now a fast-growing aviation
hub for Mexican operators.” Croyle says that NAFTA has been
good for business, fueling demands for U.S. helicopters and
parts that are maintained and serviced by Texas Aviation Services.
“Exporting has enabled us to support many jobs here at our
Fort Worth facility, “she says. “Next year we plan to double
our workforce from 100 to 200.”
Shook Mobile Technology LP of Schertz, Tex., manufactures
mobile television broadcast systems used by commercial television
and independent production facilities. In addition to television
satellite trucks, the firm also builds high tech vehicles
for homeland security. With counseling and trade leads provided
by the U.S. Commercial Service in San Antonio and U.S. Embassy
in Mexico, Shook has greatly expanded its sales to Mexico
over the years. Ron Crockett, President and Director of Sales
and Marketing, says that Mexico has long been the firm’s most
consistent international market. “Greater San Antonio is strategically
placed for doing business across the border, and Mexico’s
growing middle class is creating more demand for television
programming and satellite technology, and that’s good for
business.” Crockett also says that having bilingual staff
who understand the market and culture is key, and that in
20 years, he’s never had a bad business transaction in Mexico—but
that his firm always does its homework first. “The most important
thing about exporting is that it allows us to spread the risk
and buffer any downturns in the domestic economy,” he says.
“About 50 percent of our sales are international, and that
has allowed our company to support many jobs here at our facility
in Schertz.”
And finally let’s take MIOX Corporation of Albuquerque, New
Mexico. The firm manufactures biological enhancement products
for wastewater treatment and agriculture. With help from the
U.S. Commercial Service in Albuquerque and Mexico City, the
firm was able to make new sales to Mexico. Ioanna Engstrom,
Director of International Sales, says that Mexico, "continues
to be a huge focus for us, and with the country's developing
infrastructure and demand for improved water quality, we see
opportunities for years to come." Altogether, Engstrom
says, sales to Mexico and NAFTA have played a major part in
her company's overall export growth, which is expected to
double in 2008.
Mexico is clearly open for businesses from the Southwest
and throughout the States. Here in Mexico City we’re ready
to help your exporting firm find the right contacts and grow
your business. We look forward to broad participation at the
Building Partnerships in Infrastructure conference, and to
the continued expansion of U.S. businesses in the Mexican
market.
For further information on the Mexican market, go to http://www.buyusa.gov/mexico/
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