Op1033 Economic Development
The Brownsville-Harlingen MSA is the poorest in the nation. Unfortunately, this is not a recent trend. We have been last or near the bottom for some time, often trading for last place with our neighbors.
You can blame external uncontrollable factors for this situation and give up. But we choose instead to believe that we can change our destiny and that there is hope for transforming the future of our region.
There are a number of factors that support this view.
First, global energy and more favorable labor cost trends favor the reshoring of manufacturing back to North America. Second, we are strategically located at at the epicenter of the shared North American manufacturing platform. There is no better place to enjoy the competitive advantages of the US and Mexico than on the border. Third, our abundant and low cost energy reduces a significant part of the manufacturing cost structure and gives us a significant competitive advantage. Fourth, there is already an existing advanced manufacturing base immediately across our border upon which we can build; and finally, emerging mass customization consumer trends favor our proximity, and its associated low time-to-market, to the largest consumer market in the world.
Because of the confluence of these local and global factors, we have a significant and viable opportunity to transform our largely pass-through, low value added economy, to an investment driven, high value added, job producing economy based on industrial development in four important clusters:
• advanced/intelligent manufacturing in the automotive, energy, electronics and aerospace industries
• hospitality and tourism
But transforming our economy and attracting the private sector investment necessary to create badly needed jobs won’t be easy. It will require our region to be able to compete for private sector investment with other regions around the world. Basically, it boils down to whether we can provide private capital with a better return/risk profile than other areas of the world.
That is easier said than done, but it is within our reach if we have a collective vision and work together to achieve it.
Ultimately our comparative competitiveness comes down to a number of factors. These include the quality of our leadership, effectiveness of our collaboration, quality of our infrastructure, strength of our workforce skills, our technological capacity, availability of capital, our entrepreneurship culture, and our marketing capacity and effectiveness, among a number of others.
Five of these competitive factors, in particular, need our immediate attention:
1. Leadership and Collaboration. Sustainable and effective collaboration between the public and private sectors under a single regional and binational economic development framework is a necessary condition for economic development. As it is often said: collaboration is the new competitiveness.
2. Workforce Skills. A regional integrated workforce development and education strategy, based on both private and public sector efforts, is necessary to create a sustainable pipeline of trained, highly skilled workers to meet industrial developments needs and attract well paying jobs to the region.
3. Reliable and Cost Effective Infrastructure. A single regional infrastructure (transportation and utilities including high speed internet) strategy, implemented through public-private partnerships, and driven by economic development priorities is essential to provide the cost effective and reliable infrastructure services needed to meet our future pressing industrial development needs.
4. Capital AvailabilityAn adequate and cost effective capital supply is necessary to support two of the three pillars of economic development: create new local firms; and upgrade the capacity of existing firms.
5. Entrepreneurial Culture. It is imperative that we not rely exclusively on recruiting outside firms to fuel our region’s economic development. We must foster a binational entrepreneurial culture to create new local firms, and increase the capacity of existing grins, that will help drive future job creation and reduce the loss of our valuable human capital to other regions. These are the five short term priorities for OP10.33’s economic development strategy.As with any plan, we need to track our progress and identify any needed mid-course corrections.
We will establish metrics for each goal and strategy. And we will keep an eye on three key global metrics that will constitute the dashboard we will use to help us monitor the overall economic viability of our region:
• Per capita income
• Poverty rate
• Net Asset Valuation (tax base ) per capita