Specialized Manufacturing
Over the last 20 years Baja has experienced a dramatic expansion in manufacturing, driven predominantly by
Asian investment in television and computer monitor production, but also in electrical and electronics-related production. This investment boom is largely the result of two factors: the passage of NAFTA in 1993 and the fact that Mexico provides a competitively priced production platform next door to the huge and lucrative U.S. market.
NAFTA provides an incentive for Asian producers to locate production in Mexico by eliminating tariffs on goods shipped within North America while maintaining tariffs on goods shipped from Asia and other regions outside the North American trade zone. This, coupled with the historic transfer of television and other consumer electronics production from the United States to Asia, created a situation in the 1990s in which most remaining U.S. production was transferred to Mexico and Asian production "returned" to North America via Mexico.
This growth and investment has moved Tijuana's manufacturing economy beyond the old twin-plant maquiladora model by creating integrated complexes of assemblers and component suppliers.