Along the Border

Cities hugging the U.S.-Mexico border from Brownsville to El Paso have long capitalized on shared trade and economic development with their neighbors in Mexico.

An infrastructure boom is under way in these busy Texas border cities, thanks to the promise of expanding trade in the wake of the North American Free Trade Agreement. The state's economic revival was stymied at the border by Mexico's devastating peso collapse. With Mexico's economy now stabilizing and improving, it's the border's turn to join the Texas economic boom.

"We suffered on the peso. It hurt retail sales, but we weren't devastated because we still had this large manufacturing population that lived in the United States and worked in Mexico that was buying here," said Nancy Boultinghouse, marketing director of the McAllen Economic Development Corp. "Now we're beginning to see Mexico recover." What buoyed McAllen and other border cities from Texas to California was the continuing growth of the maquila industry, which has attracted some of the world's largest manufacturers to industrial parks in Mexico cities closest to the U.S. border. Hundreds of maquilas are now in operation, with their numbers expected to top the 4,000 mark by the year 2000. The biggest attraction to outside investors is Mexico's minimum daily wage, which Mexico's National Wage Commission has set at US$2.65 per day for 1996.

Right in the middle of the growing industrial corridor between Austin and San Antonio, New Braunfels celebrates its German heritage at its world-famous Wurstfest in a city that also is home to 16 major industrial employers.

Because maquila companies have dollar-driven budgets that pay in pesos, the peso crisis resulted in a sharp reduction in peso costs, boosting maquila employment figures, El Paso's City Department of Economic Development reported.

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