NEWS

Mexico aims to promote projects for the Northern Triangle

Tuesday, November 5, 2019

After meeting with the head officials of Central America and the White House, the Mexican government aims to promote three economic development proposals in the so-called Northern Triangle of Central America, integrated by Guatemala, Honduras and El Salvador. This is a strategy to reduce the exodus of Central Americans to the North.

In this regard, the Secretary of Finance, Arturo Herrera, explained that it is intended to achieve in the coming weeks a joint customs clearance with Guatemala, which will facilitate trade with the rest of the region, as it has customs agreements with Honduras and El Salvador.

In addition to building a common debt market for countries to operate through the Mexican Stock Exchange (BMV), which seeks to place public debt securities in the currency of each country and that these funds are allocated to the public budget. And the third project is a long-term program that seeks to expand the electrical grid to Central America.

It is worth mentioning that in the last year the arrival to the southern border of the United States has been almost 1 million undocumented immigrants, most of them are Central American families seeking asylum in U.S. territory.

During this visit to the U.S. capital, many agreements were addressed to promote investment, easier trade, better competitiveness and financing programs to prevent migration. Furthermore, the Minister of Finance of Guatemala, Víctor Manuel Martínez, who was also at the White House, informed that on the following days an agreement will be signed to facilitate trade with Mexico, which has been discussed for nine years, but which Secretary Herrera now confirmed will be signed as soon as possible.

The idea is to reduce the waiting time for the movement of goods across borders (customs) and will allow the use of infrastructure in Guatemala and Mexico, especially in the railway space being worked on in Tecun Umán, San Marcos. The project is in its final technical-legal phase, which would allow the procedures to be completed in 15 minutes, similar to the time spent with Honduras through the customs union, which will soon be joined by El Salvador.

The Guatemalan Finance Minister said that this plan seeks to generate more employment and competitiveness in business, and that the only way to do so is by efficiency in logistics services, so it is expected an increase in trade flow between the two blocks. He recalled that in Central America the average speed for freight transport is 15 kilometers per hour, while in North America is 35 kilometers, and part of that delay is due to the lack of infrastructure on highways, as well as customs formalities.

On the issue of financing, IDB President Luis Alberto Moreno reiterated that the region will continue to be supported in the lines of financing in the areas of social inclusion and sustainability.

Finally, it was reported that the United States raised an interest to invest in infrastructure and the energy market to continue advancing in the region in the plans they have to take the pipeline to southern Mexico and Central America.