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The Maquila Industry in Perspective

Jesús Tamayo


It is well known that industrialization in northern Mexico began in the middle 1960s. Although it is argued officially that this process was an outcome of Mexican government strategy designed to address border unemployment caused by a decline in cotton production and the termination of the bracero program, I suggest that two external factors were more responsible for border industrialization.

First, are the technological improvements that occurred in the industrialized countries during the 1960s. In some industries these improvements made possible the segmentation of productive processes. In particular, I refer to microconductor (micro chip) technology and to the consequent electric and electronic miniaturization process. This technological shift would soon affect the electric household goods sector and eventually would spread to the automotive electric industry. Second were the developments in communications and transportation systems that made possible the transmission of work orders and the shipment of parts and unfinished products between distant plants at comparatively low costs.

In combination, these external factors resulted both in free trade zones (export platforms) in some developing nations and in the adjustment of customs regulations (e.g., U.S. Tariff Schedules 806.30 and 807.0) in the industrialized countries. Free trade zones were established in Seoul and Inchon (Korea) in 1960 and the Kaoshiung (Taiwan) free trade zone was established in 1965. At about the same time, free trade zones were established in Ireland, Singapore, Hong Kong, the Phillipines, India and Mexico. In Mexico's northern border region, the old "free zones" and their boundaries were easily transformed into export platforms.

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