The NAFTA agreement has created free trade between Mexico, the U.S., and Canada, however, most classes and news never really touches on any details about the agreement. NAFTA has increased the amount of companies investing in Mexico because it allows immediate cost saving and a large trade hub opportunity versus outsourcing and dealing with all the transportation required to move items across oceans to our market. Mexico is also gaining through the agreement because the investors are providing revenue to improve the countries infrastructure, which will make them even more appealing to businesses, and their ports are beginning to expand with hopes of becoming a large shipping area of western state’s goods.
States such as Arizona are just beginning to utilize the potential of using shipping through Mexico while states such as Texas have already seen a 66% rise in sales. This arrangement has sparked interest of Arizona building a transportation nexus full of services such as freight forwarders, warehousing, and customs brokers in order to cash in on all the goods that pass through the state. All that’s required to achieve this hidden gem would be supplying the transportation rails and highways to make moving goods smoother. Union Pacific has already began breaking ground to set up a network of rail pathways through Mexico all the way to Canada worth $400 million.