ABSTRACT
After undergoing a very serious economic downturn due to oil and banking crises in the eighties, the state of Texas started the last decade of the century with an emphasis on economic diversification and growth. Two major external factors have contributed to the economic revival of the state. Signing of the North America Free Trade Agreement (NAFTA) led to a rapid growth of exports from Texas to Mexico. Since 1987, Texas exports to Mexico have increased near or above double-digit rates, rising from about $1 billion in 1987 to about $26 billion in 1993. Major state exports to Mexico include computers and electronic equipment, industrial machinery, transportation equipment, primary and fabricated metals, and chemicals. In the future, the implementation of the North American Free Trade Agreement is expected to strengthen further the economic ties between Texas and Mexico.
