(October 21, 2009) California and Baja share a dynamic border, long history and should continue to work together as partners, José Guadalupe Osuna Millán, the Governor of Baja California, told a luncheon gathering at the California Chamber of Commerce yesterday.

Baja California became one of thirty-one Mexican states in 1953.  The state has a population of approximately 3 million and the capitol is Mexicali. Baja has a strong focus on tariff-free export oriented manufacturing.

View Governor Osuna’s PowerPoint Presentation.

Trade Overview

Mexico continues to be California's number one export market. California exports to Mexico increased in 2008

Larry Dicke (left), CalChamber Executive Vice President, Finance and Chief Financial Officer, José Guadalupe Osuna Millán, Governor of Baja California

California's exports to Mexico are driven by computers and transportation equipment, which account for 37 percent of all California exports to Mexico. Key exports to Mexico showing growth in 2008 include processed foods and plastic products.

In a report cited by the Public Policy Institute of California, it is noted that the value of property, plant and equipment (PPE) owned by Mexican companies in California is now estimated at $1.2 billion.

Baja in a Global Perspective

According to the International Monetary Fund, Mexico ranks as the 13th largest economy in the world and the second strongest in Latin America.

Baja California is Mexico’s window to the world, Governor Osuna said. This enables Mexico to reach the Asian market, the European market and the African market and as a result makes Baja the busiest port of entry in the world, with 30.9 million vehicles per year.

As the 10th largest exporting country and the 8th largest importing county in the world, Mexico has 12 free trade agreements with 44 countries, giving Mexico access to some of the “bigger and stronger markets,” Governor Osuna explained.

“Baja borders the first global economy in the world,” Governor Osuna said referencing the North America Free Trade Agreement (NAFTA). “Baja is a neighbor of the state of California, which is the most dynamic state in the entire United States…” 

Foreign Direct Investment

In 2008, Baja received $1.4 billion in Foreign Direct Investment (FDI) according to the Mexican Ministry of Economy. Governor Osuna anticipates that the state will receive a similar amount of FDI this year. The largest contributor of FDI to Baja is the United States, but other large contributors include Japan, Korea and Spain.

Areas of Opportunity        

Governor Osuna highlighted areas of opportunity in Baja including new infrastructure, binational border crossings, strategic projects and renewable energies.

Governor Osuna explained that Baja is in the process of making upgrades to existing infrastructure at several ports and airports and expanding the state’s railways in an effort to expedite the movement of goods and people.

The Governor took a moment to elaborate on the importance of the Pureto de Colonet to Baja but promised that the port will, “not be competing in any way whatsoever with Long Beach or any of the other ports in California, but rather it will be complementing these sea ports once California again has the volume of trade that they expect on a short term, Colonet will be a wonderful alternative. This will allow us to use these ports more efficiently and take advantage of the infrastructure reduced wait time and reduce the cost of transportation.”

Governor Osuna thanked California Governor Arnold Schwarzenegger for his help in securing a presidential permit that will allow the state to build a new port of entry to Baja California, specifically to Tijuana and will be called Otay East. Baja is also working on expanding the San Ysidro port of entry.

“North bound into the U.S. we have 24 northbound lanes, in contrast there are only six lanes southbound into Mexico and this needs to be expanded,” the Governor explained.

Baja has built two wind energy parks in La Rumorosa, which has a capacity to produce approximately 750 megawatts.

“We are setting the example,’ Governor Osuna said. “Our government has already invested 26 million dollars for a 10 megawatt plant and that energy will be used to help the poorest families in Mexicali to reduce their electricity bills.”

Memorandum of Understanding

After addressing the CalChamber, Governor Osuna meet with Governor Schwarzenegger to sign and Memorandum of Understanding (MOU) to continue to build upon their cooperative efforts on important issues in the California-Baja California border region. Specifically in the agreement, they commit both states to work together in the areas of economic development, commerce, tourism, environmental protection, border crossings, security and civil protection, health, renewable energy and agriculture.

Governor Schwarzenegger and Governor Osuna have previously collaborated on important issues facing their states including the fight against climate change. At Governor Schwarzenegger’s Global Climate Summit in November 2008, both governors joined global leaders from six countries to sign a declaration to acknowledge the threats of global warming on natural resources and economic prosperity, and called on states and provinces to build and strengthen cooperative efforts to implement strategies that can immediately reduce greenhouse gas emissions in advance of the next global agreement on climate change.

Governor Osuna

In 2007, José Guadalupe Osuna Millán was elected Governor of Baja California, Mexico. Previously, Governor Osuna served as director of public investments and assistant secretary of public investments for the government of Baja California. The Governor has also served as the state director of real estate and director of the State Public Utilities Commission in Tijuana, as well as, serving as the Mayor of Tijuana. Further, the Governor has served as Representative in Congress from the State of Baja California.  

Governor Osuna received his B.A. in Economics from the Universidad Autónoma de Baja California (UABC) and a Master’s Degree in Industrial Economics from the Instituto Politécnico Nacional (IPN).

View Governor Osuna’s PowerPoint Presentation.

Staff Contact: Susanne Stirling