By Andrew Selee & Christopher Wilson, Special to CNN
Editor’s note: Andrew Selee is the vice president for programs at the Woodrow Wilson International Center for Scholars and a senior adviser for the Mexico Institute at the Wilson Center. Christopher Wilson is an associate for the Mexico Institute at the Wilson Center. The views expressed are their own.
U.S.-Mexico relations have been dominated for the past six years by efforts to address drug trafficking and organized crime-related violence. This was the right thing to do while violence spiked in Mexico, but with a new administration in office after the swearing in of President Enrique Peña Nieto over the weekend, the time has come to re-balance the bilateral relationship.
Ties tend to have the same top three items on the agenda year after year and administration after administration: immigration; drugs and violence; and trade and economic relations. Drugs and violence have dominated in recent years, and cooperation in addressing the transnational flows of drugs, arms and illicit money, as well as support for Mexico’s efforts to strengthen public security, must continue. Although the gains are still tenuous and the situation fluid, violence in Mexico does appear to have begun to decline at a national level and major advances have been made in key border cities such as Tijuana and Ciudad Juarez.
Immigration dominated the early 2000's as presidents Bush and Fox sought a bilateral deal on the topic, but it has since become clear that immigration reform is first and foremost a domestic political issue in the United States. The rate of unauthorized immigration from Mexico has now dropped to historically low levels – there are at least as many leaving as arriving – which should allow for a more rational and reasoned debate on this issue in the United States.
However, not since the negotiation and implementation of NAFTA in the 1990s have economic relations topped the bilateral agenda. Trade and jobs should once again top the U.S. agenda with Mexico for three main reasons.
First, the economy most likely will be the top issue in both the United States and Mexico for the next several years. Economic issues were clearly the top issue for voters in the recent U.S. presidential elections, and in Mexico they matched public security as the top set of concerns.
Second, by focusing on the creation of jobs and improving the competitiveness of manufacturers on both sides of the border, we can improve the tone of the relationship. We may even find that the stickier issues of security and migration become a little less intractable.
Finally, the economic agenda between the two countries has the potential to yield tangible results, creating jobs and improving the competitive position of North America vis-a-vis Asia. For years, Mexico has oriented its economy toward the U.S. in hopes of harnessing the growth of the world’s most dynamic economy. Now, at a time when Mexico is growing around four percent a year – faster than the United States – Mexico can return the favor and provide a boost to the U.S. economy. Meanwhile, Mexico’s large and growing middle class has become an increasingly important market for U.S. products.
As it turns out, U.S. and Mexican companies do not simply sell products to one another, they build products together, with parts zigzagging back and forth across the border as goods are manufactured. As a result, a product imported from Mexico is, on average, made of 40 percent U.S. parts and materials, meaning forty cents of every dollar spent of Mexican imports stays right here in the United States. Chinese products, in contrast, contain just four percent U.S. content.
This also means the competitiveness of our two countries is closely linked, and improvements in productivity in one nation make a co-manufactured product cheaper and more competitive on the global market. That is to say, growth in Mexico or the United States will boost exports from both countries: when it comes to manufacturing, we are in it together.
To produce results, the U.S.-Mexico economic agenda needs substance, and there is plenty to do. To start out, we must make the southwest border more efficient without sacrificing security. Today, long and unpredictable wait times act as a type of border tax, cutting away at manufacturers’ competitiveness a bit more each time they send goods across the border.
Since we manufacture and export together, the United States should also join forces with Mexico and Canada in designing and implementing a global trade strategy. The first step is robust cooperation in the Trans-Pacific Partnership negotiations, but the end goal must be to expand the agreement until countries like China and India feel they will lose out if they do not join in.
The countries could also tackle ways of making customs procedures more efficient, ensuring regulatory frameworks are compatible, and integrating our transportation and logistics networks to keep up with regional manufacturers, who have already integrated production.
In the end, it is a matter of perspective. If Mexico is seen more as a business partner than a source of intractable problems, a whole range of policy options that were previously considered too risky to be tried will be within reach. If such a change in perception occurs, the results will speak for themselves.