Magazine article Government Finance Review

The U.S.-Mexican Border Region: Binational Solutions to Environmental Problems

Magazine article Government Finance Review

The U.S.-Mexican Border Region: Binational Solutions to Environmental Problems

Article excerpt

Editor's note: The following article is adapted from a July 1996 report of the U.S. General Accounting Office, International Environment: Environmental Infrastructure Needs in the U.S.-Mexican Border Region Remain Unmet (GAO/RCED-96-179).

The United States and Mexico share a nearly 2,000-mile border that stretches from the Pacific Ocean to the Gulf of Mexico. Although more than half of this boundary is delineated by the Rio Grande, communities on both sides of the border are affected by the region's air quality as well as such common natural resources as groundwater, aquifers, rivers, and watersheds. For example, several communities in and bordering Texas depend on the Rio Grande for drinking water, domestic and industrial uses, and discharging wastewater. The cities of San Diego and Tijuana use the Pacific coastal waters for recreation, fishing, and wastewater discharge. Because of the transboundary character of the border region's ecosystem and the need to address pollution problems binationally, the United States and Mexico signed the 1983 La Paz Agreement, which defines the border region for purposes of environmental cooperation as the area within 100 kilometers (62 miles) of either side of their international boundary.

Between 1980 and 1996, the total population of border communities has grown from more than 4 million to almost 10 million people. Most of the population is concentrated in 14 pairs of neighboring cities [ILLUSTRATION FOR EXHIBIT 1 OMITTED]. Almost one-third of the population in the border region lives in the San Diego/Tijuana metropolitan area, while another third is distributed among the following four large metropolitan areas along the Rio Grande in Texas: El Paso/Ciudad Juarez, Laredo/Nuevo Laredo, McAllen/Reynosa, and Brownsville/Matamoros.

The rapid growth in this region is generally attributed to the potential of northern Mexican communities to provide economic opportunities that cannot be found in Mexico's interior because of adverse economic conditions. Northern border communities also offer potential access to the U.S. job market. The availability of jobs with maquiladoras - companies located in Mexico's northern border region that use imported materials to produce finished goods for export - has been a key factor in attracting Mexican workers to migrate to the border.(1) Many of these migrants tend to cluster in and around suburban areas where housing is affordable but basic environmental services, such as trash collection, sewage connections, and a potable water supply, are limited or not available.

In developing binational solutions to the border region's environmental problems, policy makers in both countries face unique challenges because of the transboundary nature of the border environment, differing approaches to addressing problems in public policy, and a substantial lack of financial and technical resources. To address these problems, the United States and Mexico have established several mechanisms: in 1993, both governments signed a supplemental agreement to the North American Free Trade Agreement (NAFTA) to establish the Border Environmental Cooperation Commission (BECC) and the North American Development Bank (NADBank), which were created to complement existing funding to improve the border region's environmental infrastructure and to strengthen cooperation on addressing the region's environmental problems. The BECC's purpose is to certify environmental infrastructure projects - primarily for drinking water, wastewater treatment, and municipal solid waste - for subsequent financing by the NADBank in the form of loans and loan guarantees at market interest rates with flexible repayment terms. The agreement encourages the private sector to invest in projects that are operated and maintained through user fees paid by polluters and the border communities benefiting from these projects. Because of the low income levels of border communities, both countries have recognized that the ongoing availability of grant funds and low-interest loans from both sides of the border that could be combined with NADBank funds was essential to make environmental infrastructure projects financially viable. …

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