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For more information about the Department of Agricultural and Resource Economics, and about training and career opportunities, please contact:

Undergraduate:
ugarec@ag.arizona.edu
Phone: (520) 621-6244

Graduate:
garec@ag.arizona.edu
Phone: (520) 621-2421

Related Links:

U.S. Department of Commerce — International Trade Administration NAFTA page

Friend or Foe?
Cross-border Trade in Arizona and Sonora

When the North American Free Trade Agreement (NAFTA) was implemented in 1994, it lowered import taxes, tariffs, and quotas between the United States and Mexico. This made it easier for agribusinesses in regions such as Arizona and Sonora, Mexico to conduct cross-border trade. But the agreement may also have raised concerns along the border. Would the freer trade regulations create new opportunities or intensify competition?

To answer this question, agricultural economists are studying the Arizona and Sonora region. A recent survey of agribusiness leaders in the two neighboring states showed that many businesses in the region already have cross-border links. In the crop sector, Sonora imports a wide range of agricultural inputs from Arizona, such as seed, equipment, machinery, and services. At the same time, Sonora exports fresh produce and a substantial labor force to Arizona, particularly Yuma. Several international companies, such as PepsiCo, Ralston Purina, and Green Giant have state of the art facilities in southern Sonora.

Researchers have also been looking at ways to enhance the region's agribusiness industry. Survey participants in both Arizona and Sonora agree that streamlining border crossings is the most important issue. Delays and red tape at the border have been costly for agribusinesses moving perishable products and live cattle across the border. Of the Arizona firms surveyed, 40 percent have at least one employee devoted to handling border crossings. Another mutual concern is the need for uniform standards and grading. Participants from both states believe that a USDA type of inspection and certification process is necessary for US consumers to accept products from Mexico.

Faculty Involvement
Russ Tronstad has studied cross-border trade and the agribusiness industry in Arizona and Sonora.

Student Involvement
Jorge Escobell, B.S. graduate, is the director of operations for North American Produce, Inc., a California processor and shipper of fresh cut produce. Being bilingual, Jorge has used his agricultural economics training in Mexico, the United States, and Canada.

Additional Reading
Tronstad, R., and P. Wong-Gonzalez. "Cross-border Trade and Perceptions: Friend or Foe?" Review of Agricultural Economics 20(Spring/Summer 1999)60-85.

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