Mexico's Infrastructure Needs Work

Mexico must upgrade its transportation services and logistics network in order to remain “competitive in foreign markets,” says a study recently released by the Economics Secretariat.

According to the study, 59% of all cargo is hauled overland by truck, while 31% is maritime and 10% moves by rail.

With the trade opening of the US-Mexican border, “the quality of transportation and just-in-time delivery to final destination markets are key issues to maintain the nation’s competitiveness.” Among recommendations to carriers by the Economics Secretariat is acquisition of new operational technologies and transportation equipment, as well as a new vision in creation of multimodal transportation alliances.

Additionally, the study calls for modernization of distribution centers and the legal framework ruling them in order to entice investment in infrastructure.

Mexico's cargo transportation industry has grown an average of 6.2% a year since the advent of NAFTA in 1994, with 8.3 million border crossings a year between Mexico and the United States. The busiest borders are at Nuevo Laredo, across from Laredo, TX, with 39%, Tijuana at San Diego with 21%, Ciudad Juarez at El Paso with 6% and Nogales across from Arizona with 6%. The rest is divided among smaller border cities.

The study says that 85% of all trade with the US is carried by truck and trade between the two nations has skyrocketed from $74.8 billion in 1993 to $216 billion in 2001.

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