Mexico’s president launches ambitious economic plan on the Mexican side of the border – NBCNews.com

Breaking News Emails

Get breaking news alerts and special reports. The news and stories that matter, delivered weekday mornings.

/ Source: Associated Press

By The Associated Press

MEXICO CITY — President Andrés Manuel López Obrador launched an ambitious plan Saturday to stimulate economic activity on the Mexican side of the U.S.-Mexico border, reinforcing his country’s commitment to manufacturing and trade despite recent U.S. threats to close the border entirely.

Mexico will slash income and corporate taxes to 20 percent from 30 percent for 43 municipalities in six states just south of the U.S., while halving to 8 percent the value-added tax in the region. Business leaders and union representatives have also agreed to double the minimum wage along the border, to 176.2 pesos a day, the equivalent of $9.07 at current exchange rates.

López Obrador, who took office on Dec. 1, said the idea is to stoke wage and job growth via fiscal incentives and productivity gains. U.S. President Donald Trump has repeatedly complained that low wages in Mexico lure jobs from the U.S. Mexico committed to boost wages during last year’s negotiations to retool its free trade agreement with the U.S. and Canada.

Speaking from Ciudad Juarez, a manufacturing hub south of El Paso, Texas, López Obrador said Saturday he agrees with Trump that Mexican wages “should improve.” He decried, for instance, that Mexican auto workers earn a fraction of what their U.S. counterparts take home, topping out at just $3 an hour versus a typical wage of $23 an hour in the U.S.

Related posts