As agriculture in Jalisco has modernized in recent years, U.S. manufacturers have ratcheted up exports of high-tech farm equipment to their southern neighbors.
For the most part, Mexico does not build the packaging machinery needed to send fruits, vegetables and other products across international borders, so it turns to the United States for that equipment, said Linda Caruso, who recently took up the position of commercial consul here in Guadalajara.
Using that very equipment, Mexican farmers then turn around and export most of their merchandise to the United States.A similar situation is occurring with automobile manufacturers, said Caruso, who sat down with the Reporter for an interview to discuss her new role. U.S. manufacturers export high-tech parts and accessories to companies in Mexico. Those companies then assemble cars and ship them out of Mexico, mostly to the United States, Caruso said.
“It’s almost as if we’re looking at a new era where we’re not just trading goods with one another, we’re going to build the goods together,” Caruso said.
Mexico and the United States remain crucial trading partners. In June, Mexico imported 18 billion dollars worth of goods from its northern neighbor, according to data from the U.S. Census Bureau. Another 23 billion dollars worth of products went the other direction.
Caruso said her job—and that of U.S. Commercial Services—is to help U.S. companies find a market for their products in Mexico and around the world. A key component of that is learning what companies need in different parts of Mexico. For Jalisco, that has meant examining the supply chain in agriculture and finding out what those operations here need.
While companies that export machinery like tractors already have a presence in Mexico, Caruso said there are opportunities for businesses that manufacture other technical equipment such as irrigation systems. The idea is to identify any gaps in the supply chain.
“There’s a lot of automation going on in agriculture and we’re trying to fill that supply chain,” Caruso said.
The Barack Obama administration has changed the viewpoint of doing business in Mexico from a focus on security to one that highlights economic opportunities available in the country, she said.
“We’re now looking at business and economic issues as the vehicle to make both our countries more prosperous,” Caruso noted.
In a demonstration of Mexico’s significance, Penny Pritzker, who became U.S. Secretary of Commerce in January, decided the country would be the first that she would visit, Caruso pointed out. Pritzker has already planned a trade mission for September.
In the late 90s and early 2000s—the first decade after the North American Free Trade Agreement went into affect—trade between the United States and Mexico tripled, said Caruso. Trade between the two countries ebbed after the September 11 terrorist attacks and the global recession several years later, but goods between the United States and Mexico have now begun to flow again.
Mexico in recent years has scaled up its high-tech manufacturing sector, becoming a bright spot in the global economy. That has created opportunities for U.S. exporters as Mexican companies are working to build world-class operations.
“Exports are growing from Mexico and in order to be competitive on a global scale they have to look around the world and see what everyone else is doing,” Caruso said. “When they’re isn’t any local manufacturer to provide those products then they kind of naturally turn to the United States, because we’re close and we have a common outlook and perspective.”