Is Arizona stepping back into the game in Mexico City?

Arizona House Ad Hoc International Trade and Commerce Committee Meeting, February 10,2014

Arizona House Ad Hoc International Trade and Commerce Committee Meeting, February 10, 2014

The Arizona House Ad Hoc International Trade and Commerce Committee met February 10 to discuss the possibility of the state joining the City of Phoenix’s efforts in opening a trade office in Mexico City. Glenn Hamer, President & CEO Arizona Chamber of Commerce; Sandra Watson, CEO Arizona Commerce Authority; Margie Emmerman, Executive Director of the Arizona-Mexico Commission; and Hank Marshall, City of Phoenix Economic Development Director presented perspectives on the impact such an office would have on the the Arizona economy, citing Mexico as Arizona’s number one trading partner with $7 billion in exports and comprising 40% of its export market. Phoenix City Council members Sal DeCiccio and Michael Nowakowski emphasized the importance of the state’s involvement. Business owner Lorena Valencia, President of Reliance Wire & Cable, implored the committee to “Take the chance while you have the choice.” For Valencia’s business headquartered in Scottsdale, sitting on the sidelines when it comes to Mexico is not an option and an AZ trade office in Mexico City would provide much needed support.

The idea of having representation offices in foreign markets is not new to the State of Arizona. Arizona Commerce Authority CEO Sandra Watson noted that before the Great Recession, the state operated offices not only in Mexico, but also in Canada, Europe and Japan. The offices were closed for further evaluation due to poor return on investment coupled with the state’s budget shortfall.

Today, 22 other states and/or cities have some sort of representation in Mexico, either through a permanently staffed office or through a business consultant. States like Texas, Colorado, Georgia, Utah, Ohio, and others have invested in a long term political and economic relationship with Mexico. The City of San Antonio has several offices.

Supporters urged the committee to consider a long-term political and economic commitment from the state and other key stakeholders. Consensus among the state, as well as the City of Phoenix, Tucson and other stakeholders will be necessary in order to develop a long-term, phased-out plan with a clear set of goals and metrics for the state’s representation abroad.

By J. Alejandro Figueroa, Principal, Strategy International, LLC & Director, U.S. Operations at Bilateral Council and Ruth Soberanes, Research Analyst, North American Research Partnership