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MACQUILADORAS

2. Definition
a maquiladora is a Mexican Corporation which operates under a maquila program approved for it by the Mexican Secretariat of Commerce and Industrial Development (SECOFI).
Assembly plants along the U.S.-Mexico border, generally owned by non-Mexican corporations, that produce finished goods for the U.S. market.
Originating in the 1960s but significant only since the 1980s, they depend on low-cost labor, advantageous tariffs, and their proximity to the U.S.
A multibillion dollar industry, maquiladoras constitute one of Mexico's primary sources of export income and have stimulated migration to the border cities.

3. Maquila Program
entitles the company, first, to foreign investment participation in the capital -- and in management -- of up to 100% without need of any special authorization;
second, it entitles the company to special customs treatment
allowing duty free temporary import of machinery, equipment, parts and materials,
and administrative equipment such as computers, and communications devices, subject only to posting a bond guaranteeing that such goods will not remain in Mexico permanently.

4. Examples of Maquiladoras in Mexico
3 Day Blinds
20th Century Plastics
Acer Peripherals
Bali Company, Inc.
Bayer Corp./Medsep
BMW
Canon Business Machines
Casio Manufacturing
Chrysler
Daewoo
Eastman Kodak/Verbatim
Eberhard-Faber
Eli Lilly Corporation
Ericsson
Fisher Price
Ford
Foster Grant Corporation
General Electric Company
JVC GM
Hasbro
Hewlett Packard
Hitachi Home Electronics
Honda
Honeywell, Inc.
Hughes Aircraft
Hyundai Precision America
IBM

5. What do they do?
Ordinarily, all of a maquiladora's products are exported, either directly, or indirectly, through sale to another maquiladora or exporter.
The type of production may be the simple assembly of temporarily imported parts
the manufacture from start to finish of a product using materials from various countries, including Mexico
or any conceivable combination of the various phases involved in manufacturing, or even non-industrial operations, such as data-processing, packaging, and sorting coupons.

6. Country of Origin - Tijuana Maquiladoras Only

7. Maquiladora Labor Force by Branch of Industry

8. Is there any limitation on where a Maquiladora can be located ?
The only limitation for deciding on a Mexican location is that new facilities will not be permitted in the Mexico City
Guadalajara
or Monterrey urban areas,
due to the congestion and industrial concentration already present.
Some states may have restrictions relating to types of industries based on environmental concerns, but the general rule is that, excepting the three metropolitan areas mentioned, the location decision is entirely up to the company.

9. Are foreign owned/controlled maquiladoras subject to restrictions on owning or leasing real estate in Mexico?
There are two kinds of areas in Mexico where land ownership by foreign interests is prohibited:
a 100 kilometer strip along the borders and a 50 kilometer strip along the coasts. In these areas, a foreign-owned maquiladora may acquire trust rights to real estate through creation of a trust, with a Mexican bank of its choice as trustee.
Leases are unrestricted regarding both location and duration.
Outside the restricted border and coastal strips, any foreign-owned Mexican company is free to purchase real estate.

10. Does Mexican labor law have any special affect on Maquiladoras?
Labor rights are enshrined in the Mexican Constitution.
The basic provisions of interest to maquiladoras include the following:
Every hourly and salaried employee must have a written employment contract.
The permissible obligatory work week is 48 hours, or six 8 hour shifts
wages are based on a daily rate rather than an hourly rate, with pay for the seventh day as well as the six work days.
Many companies, however, work a five-day week based on shifts of more than 8 hours, permitting two days off per week. Overtime rates are set by law on an ascending schedule, depending on how much overtime per week is worked, and whether holidays or days of rest are worked.
Minimum Wage Mexico - $3.40 per day vs. US - $5.15 per hour
Example: Hourly compensation costs for production workers in manufacturing Mexico - $1.21 vs US - $17.70

11. No. of Women Working in the Maquiladora Industry
472,423 (1999 data)
In the early days women made up as much as 80% of the assembly plant workforce
today they number close to 60%.
While they can legally be hired at the age of 16, it is common for these girl-women to get false documents in order to go to work at ages as young as 12, 13 or 14.

12. Problemas
Water
Surface and groundwater supplies are threatened along the US-Mexico border due to the dumping of raw sewage
agricultural runoff
and industrial and hazardous waste pollution
Contamination of the Rio Grande River during NAFTA has been well documented.
Extensive testing has revealed that extreme fecal contamination leaves border residents at risk for Hepatitis A.

13. Air
According to the EPA, border area residents are exposed to health-threatening levels of air pollutants, including carbon monoxide.
The following US border areas exceed ambient air quality standards: El Paso, TX; Dona Ana County, NM; Imperial County, CA; San Diego, CA; Douglas, AZ; Nogales and Yuma, AZ.

14. Hazardous Waste/Sewage
Each day, 130 million gallons of industrial waste, agricultural runoff, slaughterhouse remains and raw sewage enter the New River from the Mexicali Valley.
Under NAFTA, maquiladora employment increased by 54% in Ciudad Juárez, spurring significant population growth.
Yet Juárez still has no waste treatment facility to treat sewage produced by the 1.3 million people who now live there.
The end