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In Spite of Political Rhetoric, California and Mexico Work Towards Increased Business Opportunities

October 12, 1994

By Yolanda Reynolds

La Oferta Newspaper.

Representatives from the City of San Jose’s Office of Economic Development Specialist, Assistant Director, Pamela K. Stone, and Economic Development Specialist, Joseph R. Hedges traveled to Mexico City for a business exposition showcasing California based companies and enterprises.

The “Expo California” was held October 4-7 at the U.S. Trade Center in Mexico City. This event was special, not only because San Jose area businesses had their own special displays at the expo, Trade Center was dedicated solely to promoting business from single state.

Over 80 companies took advantage of this opportunity to promote their products or services in Mexico. The companies ranged from high tech, companies such as the Idec Corporation from Silicon Valley which produces a computerized sensor for accurate color identification, to Central Valley fruit processing companies hoping to expand into the vast Mexican market that has become even more accessible with the new free trade agreement.

San Jose Vice Mayor Blanca Alvarado led a San Jose delegation to this trade expo. Besides the Idec Corporation from the greater San Jose area, there were representatives from Goodman Ball; Force Computers, United Biotech, International Moxie, as well as Steve Tedesco, Executive Director of the San Jose Metropolitan Chamber of Commerce and San Jose International Airport Director, Ralph Tonseth.

The expo drew many Mexican business people, Ledda Morales, the Latin American sales specialist for the Idec Corporation said that she had been pleased with the newly generated interest in Idec’s products by the Expo and that she developed “many good leads.”

In California, one city – San Diego has developed exceptionally healthy export-import business with Mexico. That City’s businesses dominated the expo.

With the San Diego delegation was William J. Jimenez, the San Diego regional Manager of the State of California Trade and Commerce Export Finance office. This office, Jimenez explained, provides working capital loan guarantees to financial institutions on behalf of small and medium sized California companies “in support of export transactions.”

Jimenez says that he hopes to make more small and medium sized businesses aware of the financial help that his office can provide in developing their export or import businesses. Loans are available to help out with preshipment working capital as well as for post shipment working capital or even a combination of both. There are certain requirements that must be met to qualify for these loans.

There is a great interest on both sides of the border in expanding business. U.S. companies see an opportunity to expand into the large Mexican market. According to R.C. Schrader, Director of the State of California Office in Mexico City and now a U.S. citizen spoke on Tuesday afternoon at the grand opening of the California Expo, trade between California and Mexico has grown steadily in the last six years and is expected to go beyond $14 million this year. (Of the U.S. states, Texas is Mexico’s leading trade partner).

Schrader added that, since the Free Trade agreement had been approved, trade to Mexico has increased by 17%, to Canada by 10%, while overall U.S. foreign world trade had only increased 4.8%. Those figures, he said, attested to the importance of the NAFTA agreement to the United States.

James Jones, the U.S. Ambassador to Mexico, who also welcomed the California business delegation to Mexico by speaking in Spanish, said that he was especially pleased to see California companies gathered in their own exclusive show, because the State has one of the largest economies of the nation, “if not the world.” Jones also pointed out that California companies and industries are varied and have something to offer for everyone; from a large selection of Central Valley food products, to high tech products of Silicon Valley, to the stuff of dreams – the movies produced in Hollywood.

Jones pointed out that since passage of the Free Trade Treaty trade between the two countries has grown by almost 20% while that between the State California and Mexico has grown by 14%.

Jones explained that improved economic development that benefits both Mexico and the United States and would help to diffuse the social and political disputes that might otherwise divide our respective nations. He added that, when business people come together to do business the results is “more jobs, more money, more opportunities and fewer disputes.”

Hopes for improved economic conditions, both for Mexico and the United States are high. There has been a worldwide recession and life has become especially difficult for large number of people in most countries, often resulting in serious political unrest. Governments and thoughtful businesses people are hoping that businesses and trade programs will develop opportunities that will meet a need – while at the same time create new jobs to employ many people who are now unemployed or underemployed, both here and in Mexico.

There are many opportunities available, to be held both in the United States and in Mexico.

Pamela Stone said that her office had well over twenty leads to follow up on. There are several Mexican companies that want to establish their presence in San Jose and plan to open offices here.

Mexico City has recently completed a World Trade Center (WTC) headquarters in Mexico City.’ This new office tower building will sell office space to companies wishing to establish themselves in Mexico. This will be within a business complex that will provide these companies the latest in communication technology enabling quick and easy access to, “260 world trade centers in 60 countries around the world.”

This trade center at the edge of Parque de Las Tres Culturas in Tlatelolco, will be open soon. While, nearby, a large Convention Center and shopping mall are under construction and expected to be completed in the next two years. The office spaces at the WTC will begin at $125,000. Licenciado Sr. Dr. Cesar Santiago de la Hoz explained.

Stone said that the contacts that her office, along with Chamber of Commerce Director Tedesco, had made were asked to submit articles regarding products, opportunities, and services available in the San Jose are to Canaco (Camara Nacional de Comercio de la Ciudad de Mexico) for publication in their association newsletters. The combined membership of these two organizations exceeds 135,000 member companies.

Stone said that they also met with Concamin, another organization which is a confederation of all major Chambers of Commerce in Mexico. Concamin serves its membership as a “link between business and government.” This group is interested in helping its membership develop trade relationships with the United States and to “match companies of similar interests for mutual benefit and to help identify business opportunities for member businesses.”

This trade trip to Mexico remains somewhat overshadowed by the increasingly strident anti-immigrant attitude in the United States. California Proposition 187 was a topic that came up regularly. Most Mexicans do not dispute the attitudes of some very vocal Californians, especially Governor Pete Wilson. They know that he had helped develop legislation several years ago that encouraged immigrant farm labor and is now so strongly protesting their presence in California.

Criticism both sides of the border believe that recent policies work to promote a permanent underclass who would work in the United States under conditions not dissimilar to those under apartheid in South Africa.

Some Mexican people characterized the new border control efforts along the San Diego border to be “like the Berlin Wall.”  A Texan writer, David Gensaliter, who has spent many years along the border both in Mexico and the U.S., says that Texas has more enlightened international relations with Mexico. Texas. He says, has by far the largest trade balance with Mexico.

Though there is an aggressive program in place around El Paso that has brought the number of illegal border crossing to a trickle, after an initial negative reaction on both sides of the border, he says, there is now general approval and satisfaction both in Mexico and Texas with the program. Reportedly, the incidents of immigrant abuse have been greatly reduced and trade and travel between Texas and Mexico are back to normal. Petty crime has also gone way down as a result.

Gelsanliter attributes the difference between attitudes in Texas and California to a difference in attitudes of the state governors. Texas Governor, Ann Richards, Gelsanliter says, encourages better relations with Mexico in all areas from trade, in controlling the extensive border, and in encouraging vacation opportunities which benefit both areas, Mexico and Texas.

This writer met the proprietor of a successful bed and breakfast complex, the Kuebler-Waldrip Haus built on (1847) and Danville School built in (1863) in the scenic and historic Texas community of New Brunfles. Kuebler-Waldrip’s business card proudly stated, “Hablamos Español,” which she spoke very well with ease. Her inspiration for establishing a bed and breakfast in her historic home surrounded by 43 acres of “rolling hill country,” came after a visit to the lovely “Casa Gonzalez” guest home in the Zona Rosa of Mexico City. She said that many guests came from Mexico.

Another topic on the minds of many Mexicans was the recent assassination of Jose Francisco Ruiz Massieu, the Secretary General of the Institutional Revolutionary Party (PRI).

Another politician of the same party, Manuel Munoz Rocha, along with numerous co-conspirators, are now either in jail or being sought by government officials. There is speculation that the leader of the assassination, Munoz Rocha, has been killed, even though there is a letter, supposedly written by him, to the government requesting that he be given a leave of absence from his obligations as a Federal Deputy before going on trial.

His request was gained by the Mexican Legislature but in the mean- time he has disappeared.

The opposition parties, PAN and PRD, strongly protested granting a leave of absence to Munoz Rocha but they were unable to halt approval of his request. They wanted Munoz Rocha stripped of his position of Federal Deputy.

For some Mexicans, the assassination is remote and of little importance. Their feelings were expressed by saying in an exasperated tone that “it’s just a fight for power within the PRI.” Others lamented what they believe has been a history of violence, but say that “Mexico will not turn back and that, with the NAFTA Treaty and with improved trade opportunities, Mexico will change and will soon no longer be plagued with the problems of a developing nation.”

This opinion was echoed by the US. Ambassadors response to a Mexican reporter’s question regarding the impact on foreign investment in Mexico as a result of the recent assassination. Ambassador Jones said that there was enormous confidence on the part of American investors in the economic future potential of Mexico and that he did not expect investments to be significantly affected. He pointed out that if such fears were to be the case, they would have already shown up in the market place which it had not.

The week-long stay in Mexico City gave this writer an opportunity to explore a number of aspects of Mexico City. Mexico City is the largest city in the world and has over 22 million residents.

Recent attempts to reduce the smog that hovers over the city seem to have helped. The air was far cleaner than ten years ago. There are now fewer cars on the streets that use leaded gas. There is also increased interest in pollution control, not only by officials but also by the average citizen, which is reflected daily in articles and television news reports regarding environmental concerns.

A trade fair seminar on water pollution cleanup equipment was well attended by Mexican business representatives.

Some Americans companies have long realized the value of business opportunities in Mexico and are well established there. These companies sell products that range from every day low tech goods such as detergents and other households tele communications equipment and industrial enzymes for use in various phases of manufacturing.

There are Mexican companies, eager to do business here as well. Pamela Stone said that seven Mexican companies plan to have an office in San Jose.

Last year, Vice Mayor Alvarado, San Josean Fernando Zazueta and San Jose Aviation Director Ralph Toseth encouraged Mexicana Airlines to add a second pair of flights between Mexico City and San Jose. A flight leaves San Jose mid-morning while another flight leaves Mexico, as well in mid-morning. Both of these flights, with one stop in Guadalajara were filled. Customs processing, both into and out of Mexico, have been greatly simplified making it less cumbersome and time consuming.

Tourism for many parts of Mexico especially in the interior areas is down. With careful planning, so too are prices. Entry fees to the museums are still reasonable and they are not crowded. A visit to the many historic and famous sites of Mexico would be well worth the travelers’ time.

For more information on business opportunities in Mexico, contact Pamela Stone or Joe Hedges at the Office of Economic Development; telephone number (408) 277-5880. To contact Dr. Cesar Santiago de La Hoz, sales manager of the World Trade Center, the telephone number is 011-53-5-628-8330. For more information on the California Trade and Commerce Agency Export Finance Program, William J. Jimenez can be contacted at (619) 645-2492. © La Oferta Newspaper.

 

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