ARIZONA & MEXICO

Figure 1. Imported fresh produce from Mexico through Arizona, 2004-2014 (dollar value)
3500
3000
2500
Imported fresh produce 2004-2014
Figure 1: Imported Fresh Produce from Mexico through Arizona 2004-2014
$ millions
2000
1500
1000
500
0
2004 2005 2006 2007 2008 2009 2010 2011 2012 2013 2014
Nogales
Other AZ BPOE
Source: AZMEX Economic Indicators, https://azmex.eller.arizona.edu
Source: AZMEX Economic Indicators, https://azmex.eller.arizona.edu
WHY IS IMPORTATION OF MEXICAN FRESH PRODUCE IMPORTANT TO ARIZONA’S ECONOMY?
Economists typically emphasize exports as a main force of economic growth, because the sale of
products to external markets is how new money is brought into a region where it generates new jobs
and new wages through multiplier effects. By the same logic, importation of products generates
opposing effects, since the money travels out of a region. What, then, makes the importation of fresh
produce from Mexico through Arizona not only different from typical “imports,” but moreover,
contribute significantly to the economies of Arizona’s border counties as well as statewide? A simple
answer to this question is that the produce does not just pass through the international border on its
way to North American consumers. Instead, an entire industry has developed around inspection, custom
brokerage and freight forwarding, warehousing and packaging, sale brokerage, shipping, and logistical
distribution to North American markets.
HOW DOES NOGALES’ FRESH PRODUCE INDUSTRY GENERATE JOBS AND WAGES IN ARIZONA?
Two studies conducted by The University of Arizona used sophisticated analyses to identify key activities
and produced a set of measures to grasp the economic importance of the fresh produce industry for
Arizona’s jobs and wages. A statewide perspective was taken in the 1997 study, while the more recent
study, conducted in 2013, focused on Nogales and Santa Cruz County. 1
The fresh produce “industry,” which is concentrated in Arizona’s border city of Nogales, consists of several
activities that are directly involved with facilitating fresh produce imports from Mexico. These activities
are carried out by merchant wholesalers, wholesale agents and brokers, freight forwarders and custom
brokers, administrators and laborers in warehousing and storage facilities, and providers of
transportation services from the border to warehouses. A number of other activities are closely related to
the fresh produce industry, bringing additional money to the County and Arizona. These activities
include Custom and Border Protection (CBP) services, collection of truck crossing fees by the Arizona
1
V. Pavlakovich-Kochi and G. D. Thompson, “Fresh Produce and Production-Sharing: Foundations and Opportunities for
Nogales and Santa Cruz County,” The University of Arizona, 2013, Prepared for Nogales community Development; V.
Pavlakovich-Kochi, A.H. Charney, A.C. Vias and A. Weister, “Fresh Produce Industry in Nogales, Arizona: Impacts of a
Transborder Production Complex on the Economy of Arizona, An Economic and Revenue Impact Analysis,” The University of
Arizona, 1997, Prepared for the City of Nogales. Available at http://ebr.arizona.edu
53 • ARIZONA & MEXICO • ARIZONA TOWN HALL • APRIL 2016