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Singing the Border Business Blues

Frontera NorteSur, News Report, Staff Posted: Apr 02, 2009

Shine manager Ana Gonzalez leaned behind the counter of a virtually deserted store in a virtually abandoned shopping mall. A five-year veteran of the womens apparel establishment and other stores at El Pasos Sunland Park Mall, Gonzalez said sales were abysmal. This is the worst Ive seen it, Gonzalez lamented. Even weekends, when the cash register rings up much more action, is not like it used to be, Gonzalez said, with a hint of nostalgia.

On a recent weekday inside the mall, signs offering cut-rate deals spruced more than a few storefronts, while a dentistry business advertised a teeth-whitening special for $69. Gazing down at the quiet walkways, the Mervyns outlet stood vanquished as yet another casualty of a national and international crisis. Recession or no recession, looks still count big: the busiest action unfolded at a beauty store where several women were getting their nails polished.

Like Gonzalez, Dippin Dots branch manager Lizha Quezada has watched business slow to a crawl since last fall. Interviewed by Frontera NorteSur during the usually busy lunch hour, Quezada said she had helped only five customers at the yogurt-ice cream stand in a one-hour period, a business pace far weaker than the normal flow of 15 to 20 customers who typically show up for a sweet fix.

A roving company employee, Quezada blamed the business downturn on a shortage of U.S.-resident customers at the Sunland Park Mall as well as huge loss of Mexican customers at the Bassett and Cielo Vista malls where the young manager also puts in time. Many El Paso merchants have long been
dependent on sales to visitors from Ciudad Juarez and other parts of the state of Chihuahua.

Enjoying 10 years in the El Paso retail business, Quezada estimated there were 35 percent less customers coming from Ciudad Juarez today than just several months ago. Normally enjoying a 20 percent annual increase in sales, Quezada said the numbers this year were tumbling into the negative
side of the ledger so far.

Border crossing statistics recently reported in the maquiladora trade industry journal Juarez-El Paso Now showed a major drop in northbound traffic beginning in 2008. According to the publication, semi-trailer crossings dropped from 782,369 in 2007 to 758,856 in 2008, while other vehicular traffic plummeted from 5,837,570 vehicles two years ago to 5,344,828 in 2008.

For better or worse, the twin cities of El Paso and Ciudad Juarez are bound together by an economic umbilical cord. Spreading from Wall Street, the economic meltdown has scalded Ciudad Juarezs export assembly industry that supplies all manner of goods and gadgets to the United States and other foreign nations.

Citing Mexican government statistics, Juarez-El Paso Now reported at least 48,800 Juarenses lost their jobs in 2008. The Texas citys official unemployment rate, meanwhile, shot up from 5.7 percent in February 2008 to 8.2 percent in February 2009, a jobless percentage which was nevertheless below the national average of 8.9 percent for the same month. Altogether, an estimated 24,600 El Pasoans went without work last month.

Complicating the current business scene is the latest Mexican peso devaluation. For those Juarenses still lucky enough to have income to spend in El Paso, prices are 40 to 50 percent higher than they were before last October.

Local businesses are responding in different ways to the crisis. Situated just across the New Mexico state line from El Paso, the Western Playland entertainment center is advertising one-dollar rides to attract fun-loving families. Red Lobster and other eateries are offering two-for-one dinner specials to lure diners. Also located a stones throw from El Paso, the Sunland Park Racetrack and Casino in New Mexico has implemented an obvious cost-savings measure. Perhaps to the consternation of gluttons, the casinos all-you-can eat buffet has replaced its generously wide dishes with little blue ones that resemble hospital cafeteria plates.

Not everyone is singing the blues in this borderland. In the area surrounding the University of Texas at El Paso, where building improvements are underway, a new bank along with a smattering of new
restaurants and bars have opened their doors for business. A turnout of 27,000 screaming fans to the universitys famed Sunbowl for a March 25 match between two professional Mexican soccer clubs bode well for future events of a similar caliber.

In July, El Paso will benefit from the opening of a new medical school. Additionally, anywhere from $3.7 to $4.4 billion will be directly pumped into the local economy from the expansion of Fort Bliss to a post hosting 37,000 soldiers by 2012.

Paradoxically, Fort Blisss expansion could touch off other economic troubles. Slashing spending, the Department of Defense reduced from 7,000 to 4,000 the number of new houses slated for construction on the base. The move triggered predictions by some observers in the real estate and construction industries of a housing shortage of 4,800 units and an accompanying inflationary rental market unleashed by the summer of 2010.

A mismatch exists between El Pasos low incomes and the desires of housing developers to make a profit. Our median incomes here are just so low, Tropicana Building Corporation President Booby Bowling, Jr. told a local publication. And it is too much of a shock at once. The market needs time
to react.

Currently, El Pasos municipal economic development department is working on a proposal to encourage more rental construction.

Hauled by truck down a crowded street on a recent day, the old sign for the Warren Apartments that advertised $382 monthly rents and that was headed for whereabouts unknown could have been an omen for things to come in the rental market.

Some detect opportunities amidst the economic crisis. Emerging from her office at the Sunland Park Mall, Adriana Provencio took time to explain the nature of her new business. Provencio represents Ciudad Juarezs Medical Specialties Center (CME), an organization of 150 doctors in Ciudad Juarez that operates a hospital conveniently located near an international bridge connecting to El Paso.

Formally opened last December, the CME office in Sunland Park Mall is the physicians organizations first concerted attempt at promoting medical tourism.

I hope medical tourism gets really big, Provencio said. It is in now. People are going to India and Thailand.

Depending on the procedure or treatment, physicians fees in Ciudad Juarez vary, but Provencio calculated U.S. patients generally pay about one-third the price in Mexico than for the comparable service in the United States.

Ranging the field from family doctors to specialists, Ciudad Juarezs physicians are highly qualified to address the broad spectrum of health maladies and heal a variety of ailments, Provencio said. The only one we dont have is psychiatry, the sales representative added.

Provencio said the CME is especially interested in recruiting new patients from the large pool of uninsured people in the 18 to 64-year-old age bracket. Offering same-day service, the organization plans to provide transportation from the Sunland Park Mall to Ciudad Juarez soon, Provencio

Provencio acknowledged that recent outbreaks of narco-violence have scared off potential patients from the United States, but she insisted the CME hospital was in a secure location. Violence doesnt impact us, because its mainly bars and restaurants getting hit, Provencio said.

If the narco-violence continues on the downward spiral it has entered since the large-scale deployment of army troops on Ciudad Juarezs streets last month, Provencio and the CME will be ready to tap into a ripe market.

A recent study by the Robert Wood Johnson Foundation showcased New Mexico and Texas as Numero Uno and Numero Dos, respectively, of states with the largest number of workers with no health insurance. Whats worse, the report covered the years 2006-07, long before thousands of new pink slips greeted the eyes of many borderland workers.

Additional sources: El Diario de El Paso, March 25, 26 and 27, 2009. Articles by Nancy Gonzalez, Ivan Alejandro Rodriguez and the Associated Press. KDBC (El Paso), March 26, 2009. El Paso, Inc. March 22-28, 2009. Article by Robert Gray. Prospector (UTEP), March 26, 2009. Article by Herman Rojas. Juarez-El Paso Now, March 2009. Articles by Sergio Ornelas and Ramon Salcido. Office of state Senator Eliot Shapleigh, March 12, 2009. Press release.

Frontera NorteSur (FNS): on-line, U.S.-Mexico border news Center for Latin American and Border Studies New Mexico State University Las Cruces, New Mexico

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