Improving the Border Region's Competitiveness

1. Improving the Border Region's Competitiveness Border Legislative Conference March 26, 2004 Senator Eliot Shapleigh 29th Senatorial District El Paso County www.shapleigh.org Austin: 512-463-0129 or (800) 544-1990 El Paso: 915-544-1990

2. Improving the Border Region's Competitiveness Investing in the Border to Improve Competitiveness Improving Competitiveness – The need for Investment • Invest in Infrastructure • Invest in Human Capital • Increase Access to Capital and Credit • Invest in Border Specific Economic Generators • Invest in Secured Manufacturing

3. Job Loss Across North America Kerry rips into Bush on jobs Democratic presidential candidate John Kerry on Friday said job losses "rip the heart out of our economy" and criticized President Bush's ability to make up for the millions of jobs that have disappeared during his administration. "Kerry rips into Bush on jobs." Commercial Appeal (March 6, 2004). On job losses, simplistic solutions won't work February's astonishingly weak jobs creation data surprised many people, especially White House supporters, who expected a number in the hundreds of thousands… Bush is now facing the grim prospect of being the first president since Herbert Hoover who will finish his term with fewer jobs than when he started. "On job losses, simplistic solutions won't work." Austin American Statesman (March12, 2004).

4. Jobs Shifting to China China now makes 80% of all toys sold in America. In Shenzhen, China the legal minimum wage is $0.33. Employers are not required to pay laborers pension or medical insurance. No labor contracts required. Source: "The World's Sweatshop: The Etch a Sketch Connection." The New York Times (December 7, 2003).

5. Foreign Investment in Maquiladoras Plummets • Foreign Investment in Maquilador sector down 7.5 percent • 2002: $2.43 billion invested in maquiladoras • 2003: $890 million invested in maquiladoras • Employment in Maquilador sector down 257,147 people between 2000 and 2003 • Since 2000, 183 maquiladoras have closed • In 2003, 35% of Ciudad Juarez faced unemployment Sources: "Se hunde inversion extranjera." El Diario (October 2, 2003). "Panorama aterrador." El Diario (February 8, 2004).

6. Foreign Investment in Maquiladoras Plummets Employment Volatility in Maquiladoras While employment in the maquiladora sector was lower in 1998 than in 2003, employment has dropped significantly since October 2000.

7. Improving the Border Region's Competitiveness Investing in the Border to Improve Competitiveness Solution 1: Invest in Infrastructure • Transportation • Water and Wastewater • Telecommunications • Energy • Cross Border Trade

8. Invest in Infrastructure: Transportation

9. Invest in Infrastructure: Water and Wastewater Ciudad Juarez needs 1.5 billion gallons a day, current access is 5 million gallons. • There is a backlog of $1–3 billion in needed wastewater and drinking-water projects in the Border Region • Management of water resources along the border is fragmented legally and institutionally Source: Nitze, William A. "Meeting the Water Needs of the Border Region: A Growing Problem for the United States and Mexico." Center for Strategic International Studies, April 2002.

10. Invest in Infrastructure: Technology Texas-Mexico Border Offers Unique Opportunity to Become High Technology Production-Sharing Center Texas-Mexico Border communities' logistics – international trade services, transportation routes, distinct trade areas High technology in area with New Mexico and Texas research laboratories Lower cost production sharing manufacturing of higher technology products Michie, Donald A., Ph.D.. "Testimony Beofre Senate Committee on Internation Relations and Trade, 78th Legislature." El Paso County Courthouse, El Paso, Texas. March 5, 2004.

11. Invest in Infrastructure: Energy Gas Production Along the Border Natural Gas Liquid Production Texas • In the year 2002, Texas produced almost 5,612,000,000 barrels of natural gas. 1000 Barrels per day

12. Invest in Infrastructure: Cross Border Trade • Invest in a "one stop" model at Border ports of entry to cross commercial vehicles in twelve minutes, not six hours • Issue "smart cards" to Border citizens, the most frequent travelers across Border points of entry • Authorize Border Mass Transit projects at key Border Metroplexes • Invest in Border rail routes to shift cargo from commercial vehicles and lines to rapid rail and just-in-time markets • Increase personnel at Border crossings to allow 24 hour port access

13. Invest in Infrastructure: What Texas Has Done S.B. 913, 76th Session "One-Stop" Border Inspection Facility • facilitate the flow of commerce • improve federal efforts aimed at interdiction • protect our public health • conserve our environment by decreasing the idling time of commercial vehicles • protect the already severely overburdened highways along the Border by preventing overweight trucks from traveling on Texas' roads Port Authority Feasibility Study, 77th Session • reduced stop/no stop process is feasible for most trucks • process does not add substantial infrastructure costs • linking facilities will improve vehicle safety standards compliance

14. Improving the Border Region's Competitiveness Investing in the Border to Improve Competitiveness Solution 1: Invest in Infrastructure Solution 2: Invest in Human Capital • Workforce Training

15. Invest in Human Capital Population Growth Along the Texas-Mexico Border

16. Invest in Human Capital: Workforce Training States Investment in Workforce Training Texas vs. California

17. Finding Creative Avenues for Workforce Training Invest in Human Capital: Workforce Training Frontier of the Americas The digital divide is the wedge between the "information rich" (those with higher-than-average incomes and levels of education) and the "information poor" (such as those who are younger, those with lower incomes and education levels, and those who live in rural areas or central cities).  By closing the digital divide we can achieve educational equity. Through educational equity, the Frontier of the Americas Program can create sustainable links to education, community and commercial resources.

18. Improving the Border Region's Competitiveness Investing in the Border to Improve Competitiveness Solution 1: Invest in Infrastructure Solution 2: Invest in Human Capital Solution 3: Increase Access to Capital and Credit • Loan to Deposit Ratio • Home Lending

19. Increase Access to Capital Texas Trails the Country in Loan-to-Deposit Ratio 15 Most-Populous States Ordered by 2002 Ratio

20. Increase Access to Capital Texas Leads the Country in Subprime Lending

21. Improving the Border Region's Competitiveness Investing in the Border to Improve Competitiveness Solution 1: Invest in Infrastructure Solution 2: Invest in Human Capital Solution 3: Increase Access to Capital and Credit Solution 4: Invest in Border Specific Economic Generators • Educational Opportunities • Access to Health Care • Transnational Lending • Economic Development Hubs

22. Invest in Border Specific Economic Generators Increase Educational Opportunities Thunderbird • Thunderbird's Garvin School of International Management in Glendale, AZ is the world's leading source of international management education and a pioneer in this field. • Thunderbird's tripartite foundation of business courses, international and regional studies, and language and communication includes a broad range of business specializations.

23. Invest in Border Specific Economic Generators Increase Access to Quality Healthcare • The State has supported El Paso's number one priority, a four-year medical school at Texas Tech's El Paso Campus, by approving $95 million in Tuition Revenue Bonds for a Research Tower and a Classroom Facility at Texas Tech El Paso. • The school will create over 1,000 new higher paying higher skilled jobs, will increase per capita income, create greater business opportunity, and improve quality of life. • The fully developed medical school will have positive impact of $185 million on the community. El Paso Medical Center of the Americas

24. Invest in Port Specific Economic Generators Increase Transnational Lending Opportunities Banking on the Border – Laredo's Financial Community Since 1970 when total assets only reached $102 million, the Laredo Region's banking community has flourished. Laredo bank assets rose from $102 million in 1970 to $1.7 billion in 1988, and by the end of 1994 the city of Laredo attained the status of a "$4 billion plus" banking center. Laredo Banks include: • International Bank of Commerce • Laredo National Bank • Wells Fargo • Falcon National Bank • First National Bank • South Texas National Bank

25. Commodity • Plastic • Rubber • Chip Board Suppliers • Security Plastic, Advance Dial Co. • Sei Woo • Stone Container Commodity • Coils • LCD • PWD • Plastic • Thermoform • Printing Suppliers • Coilcraft • Varitonics • WUS • Hartzell • Industrial 'de Plastico • Imprenta Ochoa Invest in Port Specific Economic Generators Chihuahua Local Suppliers Increase Innovative Business Opportunities Along the Border Potential New Local Suppliers Material Key Local Suppliers (Actual)

26. Improving the Border Region's Competitiveness Investing in the Border to Improve Competitiveness Solution 1: Invest in Infrastructure Solution 2: Invest in Human Capital Solution 3: Increase Access to Capital and Credit Solution 4: Invest in Border Specific Economic Generators Solution 5: Invest in Secured Manufacturing Along the Border

27. Invest in Secured Manufacturing Along the Border

28. Invest in Secured Manufacturing Along the Border

29. Invest in Secured Manufacturing Along the Border U.S. Strategic Manufacturing Zone • Shortened Supply Lines • Increased Strategic relationships between the United States and Mexico • Use tax incentives and infrastructure investment to induce manufacturers to utilize and expand maquiladora industrial base

30. Improving the Border Region's Competitiveness What do we have in common: "Investment" Senator Eliot Shapleigh 29th Senatorial District El Paso County www.shapleigh.org Austin: 512-463-0129 or (800) 544-1999 El Paso Office: 915-544-1990