MESSAGE OF AMBASSADOR EDUARDO MEDINA MORA ON THE OCCASION OF THE WOODROW WILSON CENTER’S BOARD MEETING

Señoras y señores, Ladies and Gentlemen, Dear friends.

Ambassador Wayne has spoken eloquently of the main areas of cooperation between our governments. Economy, education and science, entrepreneurship, security and our shared agendas at international fora and multilateral trade negotiations mark the beginning of a new cycle in the bilateral agenda.  But as in any cycle, we need to create a vision towards which we have to direct our efforts and to organize those efforts to achieve the expected results.

I would like to briefly address three specific topics, but (I) my real intention IS to pick your brains on how we can start working towards the construction of this new era of bilateral relations.

So let me start with a question. Is it too soon to say “North America” and to think of a community? Are we still just three nations thrown into a geographic space? Or do we share enough interests that we are able to think together of what is best for all of us as a region?

First of all, I want to address migration. Not only are we going through a drastic change in the face of immigration reform, but we are also seeing a dramatic shift in migration patterns from Mexico and into the U.S..

The exponential growth we witnessed of Mexican immigration to this country in the 1990s has overturned. We face a significant slowdown that reached almost a zero net balance in 2010, according to the Pew Hispanic Center.

But this doesn’t mean that the Hispanic population in the U.S. is shrinking. On the contrary: Hispanics are the largest U.S. minority group and they are also the fastest-growing minority within the U.S . population. According to the U.S. Census Bureau, the Hispanic population will grow from 53 million in 2012 to 128.8 million by 2060. Consequently, by the end of the period, nearly one in three U.S. residents will be Hispanic, up from about one in six today.

If we look at the voting trends, for example, we see that 1.4 million additional Hispanics voted in the last election, compared to the previous one in  2008. There is still a good opportunity for growth, though. Only 48% of Hispanic eligible voters actually voted in 2012.

What I mean to say, and this might seem obvious but I think it is hugely important, is that while immigration seems to have almost ceased, there are already more than 53 plus million Hispanics in the U.S., and they are making an impact in demographics, culture, economy and politics.

As you know, most of these people are Mexican and have strong ties to their families back in Mexico.

Now let me share with you a couple of numbers related to trade: trade between Mexico and the U.S. amounts to 1 million dollars per minute.  U.S. exports to Mexico in 2012, which represent 14% of total US exports rose $18 billion dollars above their 2011 value. According to the White House, each $1 billion in new exports supports more than 6,000 jobs. This suggests that the growth in exports to Mexico created over 107,000 new American jobs in 2012.

As a result of geographic proximity, supply chain integration, cultural bonds, and the certainty of rules laid out two decades ago by the North American Free Trade Agreement (NAFTA), the North American region has become highly integrated economically and one of the most competitive in the world. U.S. value-added in Mexican manufacturing exports is about 37%, which is ten times higher than the 3.7% of U.S. value-added in Chinese manufacturing exports. This synergy has created a win-win relationship so that when Mexico exports, the U.S. exports as well.

So how can we help this already very successful joint production? We need to reduce transaction costs and to establish the infrastructure needed for better, more efficient logistics. As 82%, or $404 billion, of bilateral trade was carried across the border via surface transportation in 2012, expanding and modernizing the current border infrastructure will help promote a world-class logistical capability that improves border wait times, customs procedures, and trusted traveler or shipper programs.

There are many other areas where we need to review our joint priorities and strategies. With regard to telecommunications, for example, we can work on making rates more competitive and on simplifying dialing.

The reliable availability of energy at market prices is not only an essential component of the competitiveness of the region, but given our resource endowments it could become a key competitive advantage. To that end, we could develop a map on North American projected energy demand vs. energy resources.

According to a report released last week by this Center, the border between Mexico and the United States is the main obstacle to bilateral trade. This border is one of the busiest in the world, with 53 ports of entry and 32 international bridges. It is less than optimal, though. Lines are long and paperwork is complex, but a simple thing like a night shift for goods at the border could take pressure off and reduce costs.

With regard to education, I seriously worry that we are underestimating the challenge we face. I want to highlight these figures: only 14,000 Mexicans came to the U.S. to study in 2012, out of the 764,495 international students that came to the US last year. Here’s another one: there has been a dramatic drop of around 40% in the number of American students that go to Mexico to study. The reasons for these low numbers are manifold.

So, the question is what can we do to address them?

There is a need to streamline the initiatives to certify certain professions in both countries. Currently, some universities are already making the effort to standardize their programs. However, this needs to be a broader initiative. Ideas on how this can be done are welcome.

So I go back to my initial question: what is it that we can do, from the government but also from the private and academic sectors to give meaning to this new era of bilateral cooperation?

What are the specific projects we have to develop, and particularly in the context of this board meeting, how can the Mexico Institute contribute to them? Those would be my questions, and I would like to hear your views on them.

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