Trusted Partner Program Expansion, Better CBP Staffing Would Improve U.S/Mexico Trade, Say Subcommittee Witnesses
Border congestion at U.S.-Mexican overland ports of entry is causing billions of dollars of bilateral commercial loss on an annual basis, said witnesses at a Dec. 9 House Foreign Affairs Subcommittee on the Western Hemisphere field hearing titled “Improving Security and Facilitating Commerce with Mexico at America’s Southern Border.” Subcommittee lawmakers held the hearing in Tucson, Ariz. Witnesses said better CBP staffing and expanded trusted trader programs would improve the processing of trade between the two countries.
Sign up for a free preview to unlock the rest of this article
Communications Daily is required reading for senior executives at top telecom corporations, law firms, lobbying organizations, associations and government agencies (including the FCC). Join them today!
To continue to build on recent U.S.-Mexico economic progress, the U.S. and Mexico must expand and improve trusted partner programs, such as C-TPAT and the Nuevo Esquema de Empresas Certificadas (NEEC), said Alan Bersin, Office of International Affairs assistant secretary at the Department of Homeland Security and former CBP commissioner, in his testimony (here). “In 2013, C-TPAT and NEEC finalized the details of a “Joint Work Plan” that will guide the work required towards achieving Mutual Recognition (MR) in 2014,” said Bersin. “MR will benefit both Mexico’s and the U.S.’s trade community and governments by increasing resource efficiency, transparency, and decreasing duplication of efforts while still bolstering security across both borders.”
Shortfalls in border infrastructure investment and insufficient CBP staff levels are contributing to severe bottlenecks, said Christopher Wilson, Mexico Institute Associate at the Woodrow Wilson International Center for Scholars. “The manufacturing sectors of our two countries have become deeply integrated, and as a result materials and parts often flow back and forth across the border multiple times as a good is manufactured,” said Wilson (here). “These costs, which amount to a border tax, end up embodied in the selling price of products manufactured in North America, eating away at the competitiveness of these goods and providing an inadvertent boost to the relative competitiveness of manufacturers outside our region.”
Some 40 percent of the value of U.S. imports from Mexico originate from materials and parts produced in the U.S. and border congestion is fueling wait times that cost an average of $7.2 billion dollars a year, said subcommittee Chairman Matt Salmon, R-Ariz. “In 2012 alone, bilateral trade in goods and services between our two countries topped a half trillion dollars,” said Salmon. “The bad news is that our ports of entry face significant challenges keeping up with this growth.”
Despite the increase in cross-border supply chains, the U.S. is failing to direct adequate attention towards trade facilitation, said Eric Farnsworth, Vice President at the Council of the Americas and Americas Society. The number of CBP officers has largely remained consistent in the last decade and few ports of entry are undergoing upgrades, but shared economic potential continues to grow, Farnsworth added. “Mexican and Canadian entry into the Trans-Pacific Partnership negotiations was a critical step, offering a vehicle to explore new markets for jointly-produced goods and to update our trade relationship,” said Farnsworth (here). “To take full advantage of the economies of scale produced by NAFTA, we should also consider negotiating together with Mexico and Canada the free trade agreement with the European Union.” -- Brian Dabbs