Category Archives: marketplace

US-Owned Maquilas Welcome Prospect Of Changes To NAFTA

Alberto Martinez welds steel at a maquila owned by Metal Industries of Florida. (photo: Lorne Matalon)

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Alberto Martinez welds steel at a maquila in Reynosa, Mexico owned by Metal Industries of Florida (photo: Lorne Matalon)

REYNOSA, Mexico–American-owned assembly-line factories known as maquilas that line the Mexican side of the border with the U.S. have been bracing for change since the election of Donald Trump. But not in the way you might expect. They clearly don’t want a border tax placed on their shipments to the United States, as the Trump administration has threatened. But they are embracing the possibility of an updated Nafta saying the current version makes it a harder to operate in Mexico compared to the U.S. It all has to do with time consuming paperwork.

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Maquila managers and trade groups interviewed in both countries see regulatory uncertainty as an opportunity. “Nafta is 30 years old. It hasn’t kept up with today’s economy,” said Mike Myers, a Texan who runs a maquila owned by Metal Industries, a Florida company that makes vents for air conditioners and heating systems.

Mike Myers, a maquila manager in Reynosa, Mexico. He opposes a border tax but supports an updated Nafta. (photo: Lorne Matalon)

Maquilas are foreign-owned factories in Mexico, many American-owned, that produce goods for export. Mexican and Asian interests also own maquilas, which sprung up like mushrooms after the rain when NAFTA took effect in 1994. Maquilas leverage low labor costs in Mexico and duty free access to the U.S. market to produce everything from televisions to medical equipment to computer parts. Continue reading

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Peace In Colombia: Progress But Challenge Remains In Highly Polarized Nation

This guerrilla who did not wish to be identified by name, said he lost his arm during the conflict in Colombia. He is painting an image that marks 53 years since the formation of the FARC, the Spanish acronym for the the Revolutionary Armed Forces of Colombia. (photo: Lorne Matalon)

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META, Colombia—Making peace after five decades of armed conflict in Colombia is a process fraught with challenges. The stakes for the United States stake are enormous both politically and economically. The two countries have a free trade deal and American companies like Coca-Cola and ExxonMobil are major players in Colombia. Colombian President Juan Manuel Santos is at the White House today to talk with President Donald Trump about protecting Colombia’s nascent peace process. After supporting the Colombian military for years—seven billion dollars since 2000 in its fight against leftist rebels —the U.S. is now helping to finance peace after a deal to end the conflict was signed in November. The U.S. Congress approved a 450-million dollar package earlier this month called Peace Colombia to help Colombia craft a durable peace. That number is likely to be reduced next year however as the Trump administration has been clear that it plans to reduce foreign assistance packages.

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Driving through the hills of Meta, where the Colombian Andes cascade down into a lush green valleys, where sunbeams dance on the bluest of skies, it is hard to imagine the bloodshed that once unfolded here.  Meta was ravaged by a war that pitted Colombia’s army and private militia against leftist guerrillas known as the FARC—-the Revolutionary Armed Forces of Colombia. The FARC began as a rebellion against economic inequality in the 1960s. It then entered the cocaine trade to finance the conflict. And sowed terror in rural Colombia, killing civilians and extorting businesses.

Colombian soldiers at a checkpoint in the mountains of Meta, Colombia. The army battled the guerrillas here but today, guerrillas are asking for a greater military presence here to protect the region from incursions by organized crime and private militia. (photo: Lorne Matalon)

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Fraying At The Seams: The Challenge Of Fair Trade Coffee In Mexico And Guatemala

photo: Lorne Matalon

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Paulino Agustín and Sinael Altamirano prepare ground in the mountains of Chiapas state, a prime coffee growing region in Mexico. They are digging before planting coffee trees which typically don't produce coffee beans for three years after planting. (Lorne Matalon)

CACAHOATAN, Chiapas — The lives of thousands of small-scale coffee growers in Latin America and Mexico are better off because of fair trade. But the system is fraying at the seams in one of the world’s most important coffee-growing regions because of a perfect storm defined by low prices, a damaging fungus and unscrupulous middlemen.

Central America and southern Mexico are major parts of the fair trade coffee mosaic and 80 percent of the world’s fair trade coffee comes from Latin America.

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“They pay well,” said coffee grower Pedro Pacheco in Spanish in Chajul, Guatemala referring to the foreigners who buy his fair trade coffee beans. He is a member of a fair trade coffee co-op in which coffee growers sell their beans together sharing risk and reward. He said his co-op works well because its foreign buyers pay a fair price that is locked in and doesn’t change even if market conditions do.

César Ulises Roblero (R) and Carlos Galves Hernandez (L) sell beans they acquire from growers from this small processing plant near the Tacaná volcano, a source of rich soil that imparts a distinct aromatic taste to coffee produced near here. (photo: Lorne Matalon)

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