Baja California`s Economy, Security, and Why It Matters
Transcription
Baja California`s Economy, Security, and Why It Matters
Baja California’s Economy, Security, and Why It Matters San Diego Regional Economic Development Corporation Board Meeting • March 13, 2013 …Some (Possibly) Surprising Manufacturing & Trade Numbers NAFTA: INTEGRATION STILL INCREASING… • Trade in the combined NAFTA marketplace of 454 million consumers is still increasing… • US$1.2+ trillion in trade between NAFTA partners in 2011 • $460 billion in trade between US & Mexico (12.5% of total US) MUCH OF THAT TRADE AT OTAY MESA PORT OF ENTRY • Otay Mesa is typically #2 Land Port along US-Mexico border… • Over 62,000 trucks cross northbound (and south) each month… • Over US$38.2 billion in imports and exports at Otay Mesa in 2011 • …Nearly$2.8 billion/month in trade in 1H-2012 TIJUANA & BAJA CALIFORNIA ALSO BIG IN MANUFACTURING Mexico’s maquiladora/IMMEX industries regaining strength; Baja California still top state…but growing more slowly than some regions • Mexico: 2.0M (above 2007 peak of 1.9M); Baja: 236K (vs. 260K in 2007) • Tijuana: 159K (vs. 170K in 2007); Mexicali: 48K (vs. 57K in 2007) • Baja’s growth sectors: medical devices, aerospace, automotive, food… REGIONAL ECONOMICS: BAJA’S ADVANTAGE FOR TECH MFG • Tijuana: a national (& North American) leader in some tech sectors… • #1 location in NorthAm for medical device mfg employment (31K) • One of top NorthAm metros for electronics mfg employment (46K) • Over 7,300+ employed in aerospace/defense mfg (similar #’s in MXL) 2010/2012 Medical Device Mfg Employment in Key Regions* 31,079 City of Tijuana* Minneapolis-St. Paul New York State Boston Metro 22,099 18,233 15,229 Chicago Metro 12,789 Los Angeles County 12,570 Michigan State 11,261 Orange County 11,528 San Diego County 10,360 Santa Clara County *data for Q2-2012 9,859 *see endnotes for estimation methodology used WHY IS MEXICO’S MANUFACTURING GROWING? There has been persistent trend for manufacturing labor cost increases in rest of North America…and many other markets • Labors costs for Mexico manufacturing have relatively flat (in US$) • Costs higher in Brazil – and (possibly) soon China BIG PICTURE: MFG COSTS NOW FAVOR MEXICO…AND TJ • China: times they are changin’ • Boston Consulting Group: by 2015, China mfg costs approx. $4.50/hr • Total China costs for mfg & logistics to North American markets increasing • KPMG: 2012 Competitive Alternatives study found little difference in Mexico v China costs • One of San Diego’s unique advantages is nearshore proximity to lower-cost, globally competitive manufacturing in Baja California Tijuana: Size, Security and Borders Waits… TIJUANA : BIGGER CITY THAN YOU MIGHT THINK • Amongst top Metro regions, Tijuana ranks #6 in population • Tijuana: Second-largest city on West Coast of North America • Nearby Mexicali is #13 in ranking of Mexico metro regions REGIONAL SECURITY HAS IMPROVED… Baja California and Northwest Mexico: on the mend… • Despite media hysteria: peak of violence in 2008 • In fact…in 2012: Tijuana’s homicide rate significantly lower than many cities in the US REGIONAL BORDER CROSSINGS: HISTORIC LOWS • Car crossings at SY continue to decline – affected by long border delays: 2.4M POV crossings/month in 2005, down to 1.2M in 2011 LITTLE BORDER DELAY DATA…SO FAR • To-date, very few efforts to accurately measure border wait times at San Ysidro and Otay Mesa… • SANDAG & Caltrans changing that: border wait time study underway (with a bit of help from Crossborder Group) BORDER CROSSINGS – PLANNED…BUT NOT ENOUGH $$ • Yet: too-little (+ delayed) funds for POEs (SY, Otay & Otay East) • Around $2-3 billion needed just for California-Baja CA POEs Why better infrastructure? It’s a benefit for the economy on both sides of the border… BORDER CROSSERS: SIGNIFICANT SOCAL ECONOMIC IMPACTS Border delays not just about inconvenience… • At-border surveys by Crossborder Group show typical $140-170 daily average expenditure by Mexico-residing border crossers • …$10-14 million in crossborder expenditures daily • …Baja residents spend minimum of $4-5 billion in San Diego retail stores annually + tourism destinations in SoCal PORT OF ENSENADA: CRUISE SHIP PASSENGERS & POTENTIAL 2012: Rebound in cruise ship passengers to Ensenada (above nearly all other MX West Coast cruise destinations) • Jan-Dec 2012: over 429K PAX arrived – an 9.7% over 2011 • MX’s #1 West Coast Cruise PAX destination in 2012 (above Cabo & PV); #2 nationally (after Cozumel) • Growth of Ensenada’s wine region points out opportunities to attract investment & upgrade attractions… • …which can benefit both San Diego & Ensenada’s cruise ship traffic – plus increase tourism expenditures SOMETHING UNIQUE: THE “CALI-BAJA” MEGA REGION Tried to give a sense of “why it matters”… • San Diego Regional EDC blog, March 4: “…Let’s make sure it’s really the year of cross-border progress.” ¡ G r a c ia s ! ¿ P r e g u n ta s ? Kenn Morris, President/CEO of Crossborder Group Email: Kenn @CrossborderBusiness.com San Diego: 619-710-8120 • Tijuana: 664-380-6151
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