ABSTRACT
Some indication of the results of trade liberalization can be obtained from examining those activities that are already working and competing directly in global markets, the maquiladoras. Dramatically reducing trade barriers in Mexico without first retraining our workers so that they can better face the new competition has been very costly. Cheap labor has not yet translated into a wave of national inputs that could make our manufacturing world competitive. Wages and salaries comprise 45 percent of the value added by the maquilas and the sale of Mexican materials or packaging account for only 1.5 percent of the foreign exchange inflow. The way the rules are established for the international trading system is particularly important. Most of the world’s discretional income is now concentrated in Japan, Europe and the United States.
