The Impact of Border Industrialization and Unlawful Immigration on United States-Mexico Trade Relations

1. Introduction

The trade relations between United States and Mexico has been affected by issues such as border industrialization, unlawful and undocumented immigration from Mexico. Both of these problems have led to a decline in the volume of trade between the two nations. As a result, the North American Free Trade Agreement (NAFTA) was signed in order to improve the economic growth and trade relations between United States, Mexico and Canada.

2. Border Industrialization

One of the main issues that has led to a decline in trade relations between United States and Mexico is border industrialization. Border industrialization occurs when maquiladoras (foreign-owned assembly plants) are set up near the United States-Mexico border. These maquiladoras import raw materials and components from the United States duty-free and then export the finished products back to the United States also duty-free. As a result, border industrialization leads to a decline in trade between United States and Mexico because it reduces the need for Mexican manufacturers to import raw materials and components from the United States.

In addition, border industrialization also leads to a decline in employment in Mexico because many of the jobs that are created by maquiladoras are low-skilled jobs that do not require a college education. As a result, many Mexican workers are unable to find work in their own country and are forced to migrate to the United States in search of employment. This migration has led to an increase in tension and conflict between the two nations.

3. Unlawful and Undocumented Immigration from Mexico

Another issue that has led to a decline in trade relations between United States and Mexico is unlawful and undocumented immigration from Mexico. Many Mexican citizens have entered the United States illegally in search of employment opportunities. However, these immigrants often end up working in low-paying jobs with poor working conditions. In addition, many of them are unable to find work that matches their skills and qualifications. As a result, they are often forced to take jobs that are below their skill level. This situation has led to a decline in wages for American workers and has put upward pressure on inflation.

In addition, undocumented immigrants often send money back to their families in Mexico. This remittance is often used to purchase goods and services from Mexican companies. However, this remittance is often spent on basic necessities such as food and shelter, which does not contribute to the growth of the Mexican economy.

4. The North American Free Trade Agreement

The North American Free Trade Agreement (NAFTA) is a agreement between United States, Mexico and Canada that was signed in 1994. The main goal of NAFTA was to improve economic growth and trade relations between the three nations by reducing tariffs and other barriers to trade. However, NAFTA has had mixed results. While it has led to an increase in trade between United States and Mexico, it has also led to job losses in both countries as companies have outsourced production to cheaper labor markets outside of NAFTA. In addition, NAFTA has failed to address some of the root causes of conflict between United States and Mexico, such as border industrialization and unlawful immigration.

In conclusion, the trade relations between United States and Mexico have been affected by a number of issues, such as border industrialization, unlawful and undocumented immigration from Mexico. These issues have led to a decline in the volume of trade between the two nations. As a result, the North American Free Trade Agreement (NAFTA) was signed in order to improve the economic growth and trade relations between United States, Mexico and Canada.

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