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Tijuana & Mexico:Lower Country Risk& Local Security Successes                     March 2012
Lowering Competitive Risks – Locating in TijuanaDeciding where to establish your company internationally should always inc...
The Facts: Putting Tijuana’s Security into ContextLike all of Mexico, Tijuana has been the subject of negative media cover...
In addition to a state-of-the-art Centro de Control y Mando – Command and ControlCenter (pictured on previous page) with 6...
Tijuana: Looking ForwardNearly four years after the peak of security                                                      ...
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2012 - Tijuana Security Successes (DEITAC White Paper)

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2012 white paper developed by Crossborder Group for the Tijuana Economic Development Corporation (DEITAC) combining updated security data for the City of Tijuana, background information about business visitation, and other topics to inform potential investors about the current risk levels and security issues in that city. Developed by Crossborder Group as one in a series of research-based informational documents for our client.

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Transcript of "2012 - Tijuana Security Successes (DEITAC White Paper)"

  1. 1. Tijuana & Mexico:Lower Country Risk& Local Security Successes March 2012
  2. 2. Lowering Competitive Risks – Locating in TijuanaDeciding where to establish your company internationally should always include anobjective analysis of various risks – using facts, independent assessments, and the realexperiences of business visitors, investors, and international officials to a region – notsensational hearsay, old data, or questionable media reports.Tijuana – only minutes from Downtown San Diego, and thesecond-largest city on the West Coast of North America “The level of security(with nearly 1.7 million residents) is the focus of this coordination among federal,analysis. The goal: to provide some fact-based context state and municipal authorities in Baja has beenabout this major metropolitan area to help potential impressive, as has beeninvestors understand why – in 2012 – Tijuana is still cooperation with U.S.Mexico’s leading city for nearshore operations, with counterparts.”2over 550 maquiladora (IMMEX) manufacturingcompanies1. — U.S. Ambassador to Mexico Anthony Wayne, Sept. 2011Also critical: to highlight the significant progress thatTijuana and Baja California have made in addressingpublic security challenges – with success that even U.S. officials (like U.S. AmbassdorAnthony Wayne, quoted at right2) and many U.S.media now acknowledge.Baja California & Tijuana ReboundingIndependent data collected by Reforma (one ofMexico’s major newspapers) and analyzed by theUniversity of San Diego’s Trans-Border Institute(TBI), shows that Baja California has achievedmajor security improvements throughout 2011. Asseen in TBI’s map data at right, from January toDecember of 2011 the vast majority of securityincidents and violence in Mexico (dark blue) Source: USD’s Trans-Border Institutenow occur 500 or more miles from Tijuana3. Total Crime IncidentsIn fact, Tijuana’s investment in security Tijuana: Jan. 2006-Dec. 2011 (Secretaría de Seguridad Públicaequipment, personnel improvements and training, del Estado de Baja California)and close coordination with State and Federal 7,500officials (including agencies within the U.S. 6,000 32.8% Declinegovernment), have resulted in a 32.8% reduction 2008 Peakin total crimes within the City since well- 4,500publicized peaks in 2008 (see graph at right). 3,000These security successes in Tijuana and Baja 1,500California have been notable enough that the 0Washington Post commented in October 2011 Sep-06 Sep-07 Sep-08 Sep-09 Sep-10 Sep-11 Jan-06 Jan-07 Jan-08 Jan-09 Jan-10 May-06 May-07 May-08 May-09 Jan-11 May-10 May-11of the City’s ―turnaround‖, and ―recovery‖4. www.Tijuana-EDC.com || contact@tijuana-mex.comCall us toll free from the US & Canada: 1-888-TIJU-EDC || ph (011-52) 664-681-8344 | fax (011-52) 664-681-8788
  3. 3. The Facts: Putting Tijuana’s Security into ContextLike all of Mexico, Tijuana has been the subject of negative media coverage aboutsecurity. Often lost in these reports, however, was the fact that criminals were fightingamongst themselves (or law enforcement), and that business visitors are not a target – aseven the U.S. State Department acknowledged: ―Millions of U.S. citizens safely visitMexico each year for study, tourism, and business, including more than 150,000who cross the border every day…there is no evidence that Transnational CriminalOrganizations (TCOs) have targeted U.S. visitors…5.‖More recently, the media has overlooked the effect of a 2011 City Homicide Rates 7 Jan-Dec 2011, per 100K populationsustained and serious effort to regain security – 0 10 20 30 40 50 60resulting in a 42% decline in homicides in the City of New Orleans 57.9Tijuana during 2011 versus 20106. As seen in the Flint, MI 55.6 Detroit 48.2comparison at right, using verified data directly from St. Louis, MO 35.4city police departments in the U.S. (and independent Newark 32.8media sources for several cities)7, the facts are clear: Baltimore, MD Tijuana 28.8 31.6despite sensational media accounts, Tijuana’s Oakland, CA 28.2homicide rate during 2011 had dropped below or was Birmingham, AL 25.4 Cleveland, OH 22.9similar to several major cities in the United States. Memphis, TN 22.7 Philadelphia, PA 20.7 Washington DCTijuana’s return as a more secure community has Chicago, IL 18.1 15.5contributed to a notable increase in business visitors toTijuana. While recent surveys have shown an average Business Visitor Visasof 30,000-40,000 business-related trips are made by Issued in TijuanaSouthern California-residents into Tijuana each (Otay Mesa & San Ysidro/Puertamonth8, in 2011 there was also a 34.7% increase in the México, January-December)number of Business Visitor Visas issued by Mexican 22,500immigration authorities at Tijuana’s Ports of Entry 20,000compared to the same period in 20099. 17,500 15,000One reason that formal business visits are on the 20,121 12,500 16,893increase: Tijuana is close by and easy to get to. This 14,941 10,000proximity is also, in fact, a security benefit – as 7,500investors and business visitors are often in Tijuana for 5,000daytime hours and have only a short drive to cross back 2,500 0into the U.S. to be with their family – something not Jan-Dec Jan-Dec Jan-Decpossible at non-border or offshore locations. 2009 2010 2011 Source: Mexicos Instituto Nacional de MigraciónInvestment in Security InfrastructureWhile Tijuana’s overall security situation in 2012 is bysome measures comparable to other U.S. andinternational business cities, the City Government,along with State and Federal agencies, continues toinvest in technology, equipment and personnel. www.Tijuana-EDC.com || contact@tijuana-mex.comCall us toll free from the US & Canada: 1-888-TIJU-EDC || ph (011-52) 664-681-8344 | fax (011-52) 664-681-8788
  4. 4. In addition to a state-of-the-art Centro de Control y Mando – Command and ControlCenter (pictured on previous page) with 60 real-time video screens, there are over 400high-resolution CCTV cameras spread throughout Tijuana’s industrial, commercial, andresidential areas; 67 sound detectors; over 1,940“Emergency Buttons” in businesses, tourism and Monthly Salary: Municipal Police Selected Cities 2011 or *2010, pesosshopping centers that allow the public to soundalarms that help direct City police to potential - 6,000 12,000 18,000criminal activities; a mobile security Control Center; Tijuana, Baja CA. 14,949and over 500 new police vehicles to increase patrol *Guadalajara, Jal. 9,167coverage and reduce response times 10. *Chihuahua, Chih. 8,930 *Monterrey Municipio, NL. 8,774Beyond technology, there have also been efforts to Silao, Guan. 8,351further professionalize Tijuana’s municipal security García, NL. 7,759services – including not only a thorough review and *Distrito Federal, DF 6,486screening process of police personnel, but also Piedras Negras, Coah. 6,328training and increased pay that now place Tijuana as Matamoros, Tam. 6,011having the highest-salaried municipal police force *Guaymas, Son. 5,900in Mexico (an important investment to improvemorale and the quality of their work). Source: Secretariado Ejecutivo del Sistema Nacional de Seguridad Pública, October 2011; amounts in MXN pesos/mo.Tijuana: Lowering the Competitive Risk for Your BusinessTijuana’s and Mexico’s economic stability and competitiveness don’t sell newspapersor draw hits on the internet, but they are facts – and also part of what investors considerwhen assessing today’s turbulent global economy. In fact, understanding how Tijuanacan leverage Mexico’s benefits in a nearshore environment just “next door” to Californiaand under NAFTA’s protective legal framework is a key element of any careful riskassessment – so how do Mexico and Tijuana rank today? In 2010, Deloitte and the U.S. Council on Competitiveness ranked Mexico #7 in their assessment of 10 factors for global manufacturing competitiveness, noting, “Proximity to the United States has boosted Mexico’s manufacturing potential and has helped position it firmly in the top rankings of the most competitive manufacturing locations.”11 Mexico also moved up to #38 in IMD’s 2011 World Competitiveness Yearbook 12, above the Philippines (#41), Brazil (#44), and Colombia (#46). Worried about global financial turmoil? Moody’s has stated that “…Mexico is considered to be one of the countries better positioned to confront an adverse global macroeconomic environment…”13, and in August 2011, Fitch Ratings gave Tijuana an AA- rating (only two cities in Mexico were rated higher)14. Reducing Risk: Mexico & Tijuana’s RankingsMexico #7 of 26 on the Deloitte/USCoC 2010 Global Manufacturing Competitiveness IndexMexico #38 of 59 on IMD’s 2011 World Competitiveness YearbookTijuana rated AA- for Municipal Public Finances by FitchRatings www.Tijuana-EDC.com || contact@tijuana-mex.comCall us toll free from the US & Canada: 1-888-TIJU-EDC || ph (011-52) 664-681-8344 | fax (011-52) 664-681-8788
  5. 5. Tijuana: Looking ForwardNearly four years after the peak of security “My visit to Tijuana vividly showedchallenges in 2008, Tijuana is regaining its place as what a wide-ranging and productivea major, low-risk and high-return investment relationship we have with Mexico… President Obama has said that thedestination in North America – as seen by the fates of the United States and Mexicogrowth of new companies like Siliken (solar) and are more intertwined than everexpansions at companies like Greatbatch, Samsung, before. What I saw in Tijuanaand others. Within two years of its June 2009 definitely supports that statement.”recession low-point, in fact, Tijuana’sIMMEX/maquiladora industry had regained nearly — Arturo Valenzuela,18,000 employees – one of the largest IMMEX former U.S. Assistant Secretary of State for Western Hemisphere Affairsemployment increases for any city in Mexico 15. April 8, 2011As has been shown with data from agencies andinstitutions on both sides of the border, thecombination of better security technologies, the further professionalization of lawenforcement personnel, and increased coordination with authorities in both Mexico andthe U.S. has resulted in significant reductions in crime in this dynamic city to levelssimilar to some locations in the U.S. – a situation that presents both low levels of risk forinvestors and visitors, as well as a trend that will likely support continued growth andinnovation in Tijuana’s economy. For more information about this Analysis, or about the City of Tijuana, please contact the Tijuana Economic Development Corporation.1 Website of Mexico’s official statistical agency, Instituto Nacional de Estadística y Geografía, accessed February 2012(http://dgcnesyp.inegi.org.mx/cgi-win/bdieintsi.exe/NIVR2501100070#ARBOL)2 Embassy of the United States Mexico City, Press Releases, Sept. 2011 http://mexico.usembassy.gov/press-releases/ep110930-bajagob.html, accessedOctober 4, 20113 University of San Diego’s Trans-Border Institute, Mapping Project, Justice in Mexico Project,http://www.sandiego.edu/peacestudies/tbi/projects/current_projects/mapping_project.php , accessed February 20124 Anne-Marie O’Connor, “In Tijuana, taking a risk on a turnaround”, Washington Post (Oct. 8, 2011),http://www.washingtonpost.com/world/americas/in-tijuana-taking-a-risk-on-a-turnaround/2011/10/05/gIQARhsSWL_story.html5 U.S. State Department website, accessed February 2012 (http://travel.state.gov/travel/cis_pa_tw/tw/tw_5665.html )6 Analysis of Tijuana homicide trends by Crossborder Group Inc., using data provided by Baja California Procuraduria General de Justicia del Estado(PGJE).7 Calculations made by Crossborder Group Inc., using city-level homicide data from January-December 2011 obtained directly from websites of policedepartments, media quotes from police officials of those cities, or (as homicide data is either not available or delayed from several cities) on regionalmedia accounts and/or crime tracking websites. Rates were calculated for 2011, using 2010 Census data for population.8 Estimates based on at-border survey data collected in 2008 and 2009 by Crossborder Group Inc. (www.CrossborderBusiness.com), for SouthernCalifornia-residing individuals that selected “business” as their primary reason for visiting Tijuana.9 Crossborder Group Inc. analysis of INAMI visa data, Jan-Dec 2009-2011 (http://www.inm.gob.mx/)10 Crossborder Group Inc. analysis of data provided by the City of Tijuana, October 2011.11 U.S. Council on Competitiveness and Deloitte, 2010 Global Manufacturing Competitiveness Index(http://www.compete.org/publications/detail/1378/2010-global-manufacturing-competitiveness-index), p. 1912 IMD World Competitiveness Center, 2011 World Competitiveness Yearbook (http://www.imd.org/research/publications/wcy/World-Competitiveness-Yearbook-Results/#/ , accessed October 2011)13 Moody’s Investors Service, “Mexico’s sovereign rating stable despite U.S. negative outlook” (August 18, 2011).14 Fitch México, Finanzas Públicas, Municipios – Listado de Calificaciones (August 31, 2011)15 Crossborder Group analysis of INEGI data for IMMEX industries (June 2009 to June 2011 data) www.Tijuana-EDC.com || contact@tijuana-mex.comCall us toll free from the US & Canada: 1-888-TIJU-EDC || ph (011-52) 664-681-8344 | fax (011-52) 664-681-8788

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