Mexico’s president, Andres Manuel Lopez Obrado (AMLO), has launched a program along the border to boost the economy just a few weeks after taking office.
According to Luis Cantu, Vice President for the McAllen Chamber of Commerce, the border zone program is designed to help people stay in Mexico.
“I know that President Obrador, what he is trying to do is form a line, an economic wall for people to not leave the country but stay inside Mexico,” Cantu explains.
Six Mexican states border the US, nearly all the border towns on the Mexican side, are twice as big as towns on the American side. Obrador is making the border zone a desirable place to be.
“The last thing that was significant was increasing wages, by a 100 percent,” said city of McAllen Mayor, Jim Darling, who attended AMLO’s announcement in Reynosa last week.
AMLO announced border towns, like Reynosa and Matamoros, will now have to pay double the minimum wage, cut income taxes, decrease the rate of value added tax and reduce gas prices.
“Regulate the gas, open it up, to be more competition, from the area, reduce gas prices, more product available,” mentioned Mayor Darling.
Cantu says this will bring more Mexican shoppers to our region, “they are saving on taxes, saving on the income taxes what is going to happen is there are going to have more money to spend.”
Cantu says not only will working in border regions double people’s salary, but companies will have more of an incentive to do business there.
“The cost of the gas and the cost of the electricity will be paired with South Texas in this case which is cheaper than Reynosa for instance,” said Cantu.
With only a few days into the new year, Cantu says only time will tell if it will boost the economy on both sides of the border.
Mayor Darling says, Washington and Mexico City forget about border regions, and this program is focusing on helping the area. “They are addressing some of the things that need change on the border that will improve the border and make us stronger as a region.”
The program began on January 1st.