Free Trade Zone Along Border Called Solution to Illegal Immigration

A leading advocate of a 400-mile-wide free trade zone painted a rosy portrait Thursday of a flourishing border economy propelled by government incentives and massive private investment--and lacking illegal immigration.

Abelardo Valdez, a Washington attorney and former ambassador and chief of protocol for the White House, said the establishment of such a free-trade region is the best available plan to bolster the sagging border economy and curb illegal immigration to the United States from Mexico. He asserted that the creation of more jobs along the economically depressed, 1,933-mile border could help stem the northward flow of undocumented aliens.

“The immigration issue is at its root an economic problem,” Valdez said at a news conference arranged by the Greater San Diego Chamber of Commerce. “The only solution for it is an economic solution,” added Valdez, who afterward brought his message to Tijuana for a luncheon of business leaders from both sides of the border.

However, while there is considerable agreement that illegal immigration is economic at its core, many experts remain skeptical about plans for a free-trade zone between the two nations. Some say it is very unlikely.

The technical difficulties of establishing such a zone would be huge and expensive, as it would necessitate tariff and customs agreements; transfers of large amounts of money, equipment and technology, and labor agreements between two nations that are often at odds. Moreover, observers say the proposal is likely to run into opposition from nationalist circles in Mexico and U.S. officials fearful that it could actually spur additional immigration of job-seekers to the border region.

“I think it’s really a very unrealistic idea,” said Oscar J. Martinez, director of the Center for Inter-American and Border Studies at the University of Texas at El Paso.

Nonetheless, a bill embodying the trade zone proposal was introduced in the U.S. House of Representatives in August. The bill, which is pending before various congressional committees, would direct the U.S. president to negotiate for a “free trade and co-production zone” with Mexican officials. The bill also would establish several commissions to monitor border problems and a border-development bank designed to stimulate investment in the area.

Essentially, the plan would set up tax and other incentives to encourage jointly owned, U.S.-Mexico corporations to set up shop along the 400-mile-wide border zone. The plan is seen as an extension of the 19-year-old maquiladora, or twin plant, program, in which special tariff provisions and other exemptions by the U.S. and Mexican governments have allowed U.S. firms to move some manufacturing operations to Mexico, capitalizing on cheap Mexican labor.

However, the maquiladora program, which employs more than 200,000 Mexican workers, has drawn sharp criticism on both sides of the border. U.S. labor unions assert that the “runaway” plants take jobs from Americans, and many Mexicans contend that the program amounts to unabashed exploitation of that nation’s workers.

But Valdez, who sits on the board of directors of the Chamber of Commerce of the United States of America, sides with other business leaders who say the maquiladora program has been a success and should be expanded. Valdez contended that the various hurdles in the path of a free-trade zone could be overcome if both nations pushed for its creation. He could give no timetable as to when such a zone might be implemented.

“I hope it doesn’t take 10 years to develop,” said Valdez, a former assistant administrator for Latin America and the Caribbean at the U.S. Agency for International Development. “Here we have the most developed country in the world pushed up against a developing country. That calls for a different approach.”

San Diego area business leaders reacted cautiously to the notion of the free-trade zone, although they expressed support for additional cooperation between government and commerce on both sides of the international line. They stressed the unique nature of the border economy, which depends on the actions of two sovereign nations.

“We absolutely have to do something about resolving economic problems along this border,” said Lee Grissom, president of the Greater San Diego Chamber of Commerce, which is studying the free-trade-zone proposal. “The future of San Diego and the future of Tijuana are one future.”