Monterrey, NL. The reopening of the United States border with Mexico sales of businesses in border cities will increase, but this increase will be gradual and will not reach the boom it achieved prior to the pandemic, due to the fall in the purchasing power of households, Jorge O. Moreno, professor of the Faculty of Economics, Autonomous University of Nuevo León (UANL).
“This Monday, November 8, access to trade in United States with Mexico, the expectations that are had regarding the growth in the commerce sector, is that with the reopening the level of merchandise exchange that was had prior to the pandemic will gradually recover ”.
“Although there are 20 months of closing of commerce in flagship cities, such as McAllen, Texas, it is expected that sales will increase gradually, and that this boom due to the opening of land borders will have a 30% increase in sales ”.
In context, he noted that the president of the McAllen International Chamber of Commerce, Carlos Marín, said that due to the travel restriction, sales fell 65% in 2020, due to traffic restrictions on international bridges.
“The impact of trade in the US border cities It was very serious, putting at risk the level of sustainability of businesses in the border area ”, warned the UANL professor.
Although an increase in the purchasing power of Monterrey is expected, due to Christmas bonuses, or credit, two factors that could affect trade in the cities of the United States would be the variation in the exchange rate, and the Good end that anticipates Black Friday, said Jorge Moreno.
Detona San Diego
For his part, Domingo Ramos Medina, treasurer of the National College of Economists, and director of Asesores Stratego, commented to El Economista that the northern border of Mexico has a comparative advantage by having as a neighbor USA, your main business partner.
“In particular on the border Tijuana-San Diego, California, is the busiest checkpoint in the world, with an average of 50 million crossings per year, which during 2020 (year of confinement) were reduced by 36%, according to US Customs and Border Protection (CBP for its acronym in English).
Also affected were (-29%) airfare; (-45%) land passage; (-55% road capacity); (-60%) tourism; (-40%) medical tourism and (-30%) shopping malls, he mentioned.
Instead, the trade in Tijuana benefited because citizens could not cross into USA to go shopping. An estimated half of the city’s population has a visa, and many work in San Diego, California.
“With the reopening it is estimated that many people will begin to cross and with it the economy of San Diego is detonated, which was affected because a large part of its sales are from Mexicans who go shopping,” emphasized Domingo Ramos.
The Laboratory of Analysis in Commerce, Economy and Business (LACEN) of the UNAM, estimates that the economic spill derived from the crossings amounted to 900 million dollars per week, 600 million that went from Mexico to USA and 300 million from north to south.
In 2020, the Mexican trade balance ended positive, but both exports and imports fell compared to 2019. This year we have a trade deficit of -9.269 million dollars, from January to September 2021, said the director of Asesores Stratego.
Reference-www.eleconomista.com.mx