By: Brian Evans
After the economic socialists and communists elitists in Mexico, America and around the globe had high hopes that the Mexican President Andres Manuel Lopes Obrador (AMLO) would plunge the Mexican nation into a communist state, all indications are proving quite the opposite. In fact, the globalists had hoped that he would be a staunch ally in their fight against President Trump’s pro-capitalist economic policies. However, AMLO has proposed and begun to implement pro-economic policies that encourage trade and help the Mexican people, as well as the nations of not only Mexico but Canada and the United States as well.
First, Mexican President AMLO has been quite receptive of working with President Trump, as he has worked alongside President Trump to replace the North American Free Trade Agreement (NAFTA) with the United States Mexico Canada Agreement (USMCA). Also, he has worked to curb illegal immigration into the United States, while President Trump has worked to secure the Mexico/American border.
Now, the Mexican President has proposed an economic ‘free zone’ along the US/Mexico border to attract investment, and reduce migration into the United States. In fact, on Saturday, AMLO announced the tax incentive for the northern border region when he said…
“It’s going to be the biggest free zone in the world. It is very important to project for winning investment, creating jobs and taking advantage of the economic strength of the United States.”
As a result, Mexico will be increasing the minimum wage by 16% nationwide, but along the US/Mexico border, it will increase by double 100%. As a result, with the 2018 minimum wage sitting at $4.40 per day, the national minimum wage will go up to $5.10 per day in January of 2019. However, in the United States border region of Mexico, the minimum wage will rise to $8.80 per day. AMLO says that the border region’s higher minimum wage will do several things. First, it will help Mexicans living there who have to deal with a higher cost of living than Central and Southern Mexico, and it will increase the purchasing power, as inflation has hit the Mexican people hard. Also, AMLO said that employers will be able to pay the higher wages, as the value-added-tax (VAT) will be cut in half, from 16% to 8% throughout the border region. Obrador predicts that this will de-incentivize emigration of Mexicans who cross into the United States in search of jobs and money, as they can remain in Mexico and make a decent living. In addition, fuel prices would equal U.S. prices.
Obrador promised in his campaign for President that he would help the country’s poor, and pointed out how Mexico had the lowest of wages throughout Central America. Meanwhile, AMLO’s ‘free zone’ proponents believe that it will reduce emigration from Mexico, and therefore stem illegal immigration into the United States by Mexicans. Also, they say that it will increase competition and competitiveness of Mexican companies. However, his opponents say they worry that Mexican companies, attracted by low taxes, might move to the free zone and create an overall loss of tax revenue for the country as a whole. Wehbe Dipp, who is a former Tijuana city council member said that his proposal is a “double-edged sword”, as she pointed out that an increased minimum wage helps workers “in sectors like agriculture because that’s where people get paid the least,” but she said that “it means that business owners won’t be able to afford (to hire) as many employees.
Ultimately, it will be a while before the effects of the ‘free zone’ are known, but one thing seems to be certain. Mexico finally has a President who appears to be trying to stem the effects of government corruption, and working to help the citizens of Mexico. Also, he seems to be willing to work along-side President Trump to forge a strong working relationship to stem illegal immigration into the United States and form fair economic trade between our two nations.