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'Borderless Innovation' provides dialogue for cross-border issues

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The San Diego Regional Chamber of Commerce, along with Bajagua Project LLC and Deloitte & Touche, illuminated the importance of transborder cooperation at the fifth Annual Mexico Economic Outlook conference and the 20th annual Forum Fronterizo luncheon Wednesday.

The joint event, titled "Borderless Innovation: A Call to Action," provided a forum for discussion on the U.S.-Mexico border's socioeconomic issues.

The Economic outlook conference consisted of three roundtable discussions on tax issues, regional growth, and infrastructure and security. The conference culminated in an economic forecast of Mexico by Citibank Banamex (NYSE: C) CEO Julio A. de Quesada.

De Quesada highlighted the enormous advances Mexico has made since the country's economic depression in the mid-1990s in trade, finance and housing. Yet he also spoke of the country's weaknesses, especially surrounding energy consumption and competitiveness against Asian nations.

"We need to have fiscal reform; we need to have energy reform. Eventually, Mexican oil reserves will have to drop, because there's no money for exploration. ... Imagine Mexico exports oil and imports gasoline," de Quesada said.

The forum luncheon, featuring Baja California Gov. Eugenio Elorduy, and a panel discussion centered around two recent studies concerning transborder economic issues.

The first was University of California, San Diego's San Diego Dialogue "Borderless Innovation" report. The second was the San Diego Association of Governments' (SANDAG) report on the economic impacts of wait times at the border. Both reports were published in January of this year.

The San Diego Dialogue, a think tank that focuses on border issues, published the report to highlight economic clusters of the region and to make recommendations to increase economic efficiency and competitiveness in the cross-border region.

The Dialogue focused on biomedical devices, aerospace and defense, software, marine biotechnology and pharmaceuticals as influential clusters. Suggestions include the creation of a Crossborder Innovation and Competitiveness Center, ongoing research on economic clusters, the fostering of binational science and technology relationships, and improving infrastructure in both California and Mexico.

The Dialogue also suggested "nearsourcing," the use of services and resources in nearby Mexico over outsourcing in Asia.

"There are many, many significant and parallel efforts taking place. However, they tend to be fragmented," said Mary Walshok, associate vice chancellor of the UCSD Extension and co-author of "Borderless Innovation."

"Cooperating economic development not only benefits our economy, it also helps us create trust and cooperation in our society and helps us become a stronger, more secure region," Elorduy said.

The SANDAG report estimated the economic loss of delays and congestion at the border to be worth around $6 billion in 2005, with losses expected to double in the next 10 years. SANDAG concluded that infrastructure improvement and possible tolls were imperative to reduce economic losses. Gov. Arnold Schwarzenegger has proposed a infrastructure development plan that he expects to place on this November's ballot.

The panel consisted of Gov. Elorduy, deputy secretary of the California Business, Transportation and Housing Agency, Yolanda Benson, Silicon Border Development LLC Chairman Daniel J. Hill, San Diego Regional Chamber of Commerce CEO and President Jessie Knight, Tijuana Economic Development Council Chairman Elias Laniado and Citibank Banamex CEO de Quesada.

"The contribution that Mexican workers have to the U.S. is tremendous. These people are already taxed," said de Quesada, adding, "(They are) the backbone of the construction industry, the restaurant industry.

"If you don't understand that, you don't understand economic reality."

The event was held at the San Diego Marriott Hotel and Marina.

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