Texas Border Business
By Roberto Hugo González
In 2023, Mexico exported approximately $560 billion worth of goods to the United States, while U.S. exports to Mexico totaled around $408 billion. This resulted in a trade deficit of $152 billion for the U.S. However, a deeper analysis reveals that the deficit may not be as unfavorable as it seems at first glance.
A significant portion of these exports stems from the Manufacturing, Maquiladora, and Export Services Industry, which accounted for $220 billion of Mexico’s exports to the U.S. Of that amount, 80%—or $176 billion—came from U.S. companies operating within Mexico. These companies leverage Mexico’s cost advantages while maintaining control over production processes, which ultimately benefits the U.S. economy.
Joaquín Spamer, President and CEO of CIL Capital, stresses this crucial dynamic, stating: “Considering that, in the same year, the United States recorded a trade deficit with Mexico of $152 billion, we can conclude that the real trade balance is not negative for the United States.”
According to Spamer, the perceived trade imbalance shifts when viewed through this lens. The profits generated from U.S.-owned companies operating in Mexico often flow back to the United States, boosting corporate revenues, shareholder returns, and reinvestment within the domestic economy. This highlights the interconnectedness of the two nations’ industries and the mutual benefits they derive from trade.
Understanding these distinctions is vital for policymakers in Texas and Washington, D.C. Strong economic ties between the U.S. and Mexico enhance regional competitiveness and create a foundation for shared prosperity. By recognizing the true dynamics behind the trade figures, leaders can craft policies that reflect the depth of this partnership and its benefits to the U.S. economy.
U.S. Bureau of Economic Analysis and the U.S. Census Bureau.
https://www.bea.gov/news/2024/us-international-trade-goods-and-services-december-and-annual-2023
