Juarez Narco-Violence Marked by Maquiladora Exception

Mexican Border Town’s Industrial Parks Have Become a “Green Zone” in the Drug War


The screaming headlines and shocking images that invade our lives daily from south of the U.S. border might lead many of us to believe that Juarez, Mexico, is a dying city bleeding out from a thousand cuts of daily narco-war violence.

The Mexican border city has seen more than 1,900 murders so far this year alone and in excess of 6,200 since January 2008, when the violence escalated with the arrival of the Mexican military to provide “protection” to the residents of the city.

But if Juarez is truly being killed off by the bloodshed spawned by the narco-trafficking trade, then why is that violence not affecting the entire city – where some 10,000 small businesses have closed their doors since 2008 due, in large part, to a wave of burglaries, kidnappings, extortion and murders that has washed over the city during the past two and a half years?

There is often an exception to most rules, and in the case of Juarez, the rule of violence does not extend to its industrial zones, which are home to some 360 maquiladora factories that employ more than 190,000 people.

In fact, according to a report provided to Narco News by the El Paso Regional Economic Development Corp., or REDCO, between January 2008 and June of this year, there was only one homicide carried out in the maquila industrial zones of Juarez.

That’s right — just one murder in this huge swath of Juarez that is dotted with maquila plants operated by huge corporations such as General Motors, Delphi, Motorola, Visteon, TECMA and Honeywell. Maquiladoras, also known as twin plants, are Mexico-based factories owned and/or operated by foreign companies that benefit from the cheap labor and favorable tax treatment.

The reality is, despite the violence afflicting the rest of Juarez, the city’s maquila industrial parks are flourishing, according to the report put together by REDCO — a nonprofit maquila booster group funded by private-sector donors.

Over the first three months of this year, the report shows, some 11 companies have notified REDCO of their intentions to locate or expand in Juarez. Between June 2009 and June of this year, REDCO reports that the maquilas in Juarez have added 24,401 new jobs — in the midst of a lingering recession no less.

How is that possible?

Seeking Answers

Narco News attempted to get an answer to that question by scheduling an interview with REDCO President Bob Cook. Unfortunately, REDCO officials later cancelled that interview due to a “scheduling conflict.”

Narco News also attempted to get some insight from officials at El Paso, Texas-based TECMA, which operates some 17 maquila plants in Juarez. Company officials at TECMA were not available for comment.

However, TECMA officials did talk on camera earlier this year with El Paso’s ABC TV station KVIA. Toby Spoon, an executive vice president with TECMA, told the TV station the following with respect to why the maquila industrial zones have been seemingly immune from Juarez’s bloody drug war:

If they [the narco-trafficking organizations] got the maquila industry, or American companies or foreign companies, if they became targets of this, it would just take it to a whole different level, and nobody wants that.

So it would appear, based on that comment, that the narco-trafficking organizations, the Mexican government and the maquila factory owners have some sort of unspoken alliance of convenience that assures protection for the maquila factories and their professional employees — some 3,400 of whom live in El Paso, just across the river from Juarez, according to the REDCO report.

Clearly, the Mexican government, and its executive business class, have reason to assure the protection of the maquila industry on economic grounds. REDCO reports that in 2008 and 2009 [as the Juarez drug war raged] foreign direct investment, due in large part to the maquila industry, totaled nearly $2 billion in the state of Chihuahua — most of that going to Juarez.

And the maquila industry also helps to assure a robust northbound commercial corridor for the area, with nearly 2,000 trucks crossing into the U.S. daily from Juarez, according to the REDCO report. And that trade is produced, to a large degree, by maquila line workers in Juarez who are paid a few bucks a day in wages – a fraction of what workers in the U.S. make for similar work.

So it seems U.S. and Mexican business interests, as well as the Mexican government, all have a considerable economic stake in assuring the maquila industrial zones in Juarez are not sucked into the violent fury of the media-dubbed “cartel” turf war affecting the residential neighborhoods and other business districts of Juarez.

That might explain why, according to media reports, at last three security zones have been set up in Juarez that are guarded by Mexican soldiers who assure safe passage for Maquila executives commuting from El Paso to the Juarez factory sites. In addition, the maquila industrial zones themselves, according to media reports, are under the close watch of Mexican state police as well as private security guards employed by the maquilas.

That all makes sense, except that the same Mexican cops and military also are supposed to be providing protection to the rest of Juarez and, to date, have failed miserably, resulting in thousands of murders — including homicides among their own ranks due to gun battles and assaults carried out by cops and soldiers allegedly on the payrolls of competing drug-trafficking organizations.

But if they are killing each other elsewhere in the city (and are otherwise incapable of preventing murders, kidnappings and extortion) how is it possible that these same cops and soldiers, and their commanders, are working together effectively to essentially prevent crime in the maquila zones — where, according to the REDCO report, between January 2008 and June 2010 there have been only 335 reported crimes, mostly thefts, and only one homicide?

Falling Flat

Now, there are some explanations that may mitigate the crime figures a bit — such as the fact that industrial areas tend to have lower crime rates than other areas of a city and, in the case of the maquilas, most of the high-wage earners who might be ideal crime targets happen to live across the border in El Paso.

But even if we take these factors into account, the crime figures, particularly the murder rate, in the maquila industrial zones still seems extremely low when compared with what’s happening in the balance of Juarez – again, more than 6,200 murders in Juarez since 2008 and only one of those in a maquila industrial zone.

As far as the myth that being a commuter from the U.S. offers some high level of protection, it is necessary to recognize that commuters can be, and have been, targeted by narco-criminals, as evidenced by the slaying in Juarez of a U.S. consulate worker and her husband earlier this year. Both victims were trailed by a hit team and later shot while in their vehicle as they were attempting to head back to El Paso.

And there is past evidence that criminals have targeted workers in Juarez’s industrial zones. In the 1990s and early 2000s, hundreds, of young women in Juarez, many of whom worked at the maquila factories, were abducted, many brutally raped and tortured to death — their bodies later dumped like garbage in fields or along roadsides.

Those gruesome homicides, clearly linked to the maquila factories, have since been dubbed the Juarez Femicides.

Following is a cable sent in March 2000 from the U.S. Embassy in Mexico City to the U.S. State Department that verifies the relationship between the maquilas and the female victims. (The cable was obtained by professor Keith Yearman of the College of DuPage in Glen Ellyn, Ill., via a Freedom of Information Act request and can be found, along with numerous other documents related to the Femicides, at this link.)

What is clear, however, is the vulnerability of the social class in which most of the murders have occurred. These women come from a group that is physically, socially and economically frail. They are made more vulnerable through a cultural upbringing that reinforces their sense of personal inferiority and resulting submissiveness. Most of these women have been forced to migrate to Juarez because of poverty in their native southern states. Drawn to the border to work in maquiladoras, they must live both on the outer limits of the city as well as on the fringes of society. [Emphasis added.]

Another possibility that has to be considered, since the crime figures in the REDCO report due come from the Mexican government, is that the murder figures are being purposely under-reported to avoid a panic that would prompt a mass exodus of maquila factories from the city.

But even this explanation seems to fall flat, given that murders or kidnappings of high-profile maquila executives, or high rates of crime on maquila factory sites, would be very difficult to keep under wraps since such crime would have a major impact on the families of the victims as well as U.S. business interests, which are closely monitored by the U.S. media and government. So it’s possible that some crime is being kept from public view, but it is highly unlikely that it would be anywhere near the level of crime that is being experienced and reported elsewhere in Juarez.

So if we eliminate those factors — lower rates of crime in industrial areas generally, a large number of potential crime targets who commute and crime stat under-reporting — as the total explanation for the extremely low crime rate in the maquila zones within a city that is deemed to be among the most dangerous in the world, then what might account for the maquilas seemingly being immune from the Juarez drug war violence?

It’s the Economy Stupid

Well, according to several law enforcers and other legal experts familiar with the Juarez narco-trafficking scene, all of whom asked not to be named, the ultimate explanation revolves around economic interests.

“There’s probably a lot of money behind the reason for the maquilas relative safety,” says one law enforcer.

That money could be in the form of protection payments to the key drug organizations or their government operatives [i.e., corrupt law enforcers or military commanders] to assure that the cops and soldiers charged with guarding the factories and maquila executives actually carry out that job.

“It would be easy to keep problems away from the maquila factories, if that was the goal,” the law enforcer explains. “Whenever a suspicious car comes through, you stop it, pull the people out and check them out thoroughly.”

Now, there is no kown evidence that any of the 360 or so maquila factories are paying protection money to criminal organizations to assure safety, but it is clear, according to the REDCO report, that there were at least five reported extortion attempts made in the maquila industrial zones last year.

And there is precedent elsewhere in Latin America for large corporations paying protection money to criminal organizations. In 2007, Chiquita Brands International coughed up a $25 million fine as part of a settlement with the U.S. Justice Department over the company’s admission that it paid some $1.7 million in protection money over a seven-year period to a violent, rightwing Colombian paramilitary group that has a history of involvement in narco-trafficking.

But there is yet another potential explanation for the low rate of crime occurring in the Juarez maquila zones.

“The first thing that comes to mind,” says another law enforcer, “is that the cartels have money invested in the area, so they want to protect that investment.”

That may seem like a shocking suggestion to some who are not familiar with the nature of the drug business, but that possibility has been advanced by others, even in the mainstream press.

A report earlier this year in the Wall Street Journal included a warning from a security expert, Alberto Islas of Mexico City, who contends that narco-trafficking organizations have the ability to infiltrate maquilas by getting their people hired as employees. Once inside the maquilas, these individuals, particularly if they are at a supervisory level, can use the company’s resources, such as warehouses and trucks, to advance their drug-trafficking operations.

However, according to one government watchdog group — the Washington, D.C.-based Project on Government Oversight (POGO) — the corruption problem with respect to border commerce has far deeper systemic roots than a few bad-apple employees. POGO suggests the root of the corruption problem stems from U.S. free-trade policies designed to foster the fast movement of goods across borders.

Major criticisms, for example, have been raised about U.S. Customs and Border Protection’s reliance on self-regulation under programs such as “C-TPAT,” which allows qualifying private-sector companies (including maquila factory operators such as General Motors, Delphi, Motorola and Visteon, among others) to oversee their own shipment security. In exchange, these C-TPAT-approved companies are granted a reduction in cargo examinations as well as expedited processing when their shipments are selected for examination.

The rational for such programs is that it allows U.S. border enforcers to better allocate scarce resources toward monitoring the immense volume of goods moved by shippers who have not been prescreened through C-TPAT and similar self-regulation programs.

Over the first six months of fiscal 2009, according to U.S. Customs and Border Protection, goods shipped via C-TPAT and a sister program called Importer Self Assessment (ISA), accounted for about half of all U.S. import value for the period — some $454 billion worth of goods.

POGO, in a letter sent to members of Congress late last year, pointed out some serious flaws in this self-regulation model.

From the POGO letter:

… Specifically, POGO has received insider information that importers non-compliant with trade laws and regulations have been approved and are applying for the C-TPAT and ISA programs.

… It must also be noted that a number of the known C-TPAT companies have committed serious trade violations in the past, yet have been granted membership into C-TPAT and ISA, without testing to verify their problems have been corrected.

… The adequacy of the self-policing programs was questioned recently in a congressional hearing.  In early December [2009], Senator Mark Pryor (D-AR) asked DHS Secretary Napolitano the following question: "There's been some news reports recently that have been critical of the … [C-TPAT] Program, and the gist of these news reports is that some Mexican gun and drug smugglers are actually using this program because it allows the trucks to get through the border quicker and I guess with less security. Are you aware of that?  Are you aware of those news reports?" Secretary Napolitano replied that she was "not aware of those news reports." [Emphasis added.]

Well, it seems Secretary Napolitano might be well advised to take some time to check out those reports, and given the safe nature of the maquila industrial zones in Juarez, she should have few worries about personal safety if she began such an inquiry in that region of the border.

Good for Business

The reality is, that despite the increased militarization of the U.S./Mexican border through programs like the $1.4 billion Merida Initiative, the drugs continue to flow across that border.

Those drugs are being shipped in large quantities via truck and car across the same bridges that are used to transport the legal cargo being hauled by vehicles serving the maquila factories in Juarez.

The only way to know whether a particular truck or car is carrying legal goods or an illegal shipment of drugs is to check the truck or car, which clearly isn’t being done in most cases in Juarez due to the immense volume of traffic – some 2,000 trucks and 34,000 cars crossing from Juarez into El Paso daily, according to the REDCO report.

The net result of this conflict between free-trade and illegal trade is reflected in the State Department’s 2010 International Narcotics Control Strategy Report:

Despite some progress, however, corruption remains a significant impediment to counternarcotics efforts in Mexico. Cartels combine threats of violence with promises of financial gain (“plata o plomo”) to influence law enforcement and government officials. Their influence is greatest among lower paid municipal and state police who have had historically lower hiring standards and fewer controls in place to check for corruption. This is a significant problem given that these police organizations represent roughly 90 percent of Mexico’s total police force.

… Production of methamphetamine takes place in clandestine labs. The two areas in the country with the highest concentration of labs are Michoacan and Jalisco. While it is difficult to estimate levels of production for the drug, it is believed to be large and growing.

… Despite the efforts of the GOM [Government of Mexico], drug cultivation rose significantly in 2009 according to U.S. government agencies’ estimates. Opium poppy cultivation more than doubled to 15,000 hectares (ha) as of September 2009 from 6,900 in 2008 — the highest level of production ever estimated in Mexico and all of Latin America combined. Cannabis production increased 35 percent to 12,000 ha from 8,900 in 2008 — the highest level since 1992. … Mexico is not considered a significant producer of cocaine, although DTOs [drug-trafficking organizations] continue to transit the drug through the country. [Emphasis added.]

Given the billions of dollars at stake in the game of moving drugs across the U.S. border, it should not be a surprise to anyone in a position of power that the maquila industrial zones in Juarez have become essentially a “Green Zone” within that city’s long-running narco-turf war?

Even in the highly unlikely scenario of there being absolutely no corruption within the maquila business community in Juarez — no payment of protection money or harboring of illegal drug-trafficking fronts — the U.S. and other foreign corporations who profit from the cheap labor of the maquilas, the Mexican government that earns tax revenue off of those factories, and the drug-trafficking organizations that cloak the movement of their prohibited products within the legal flow of maquila-produced goods appear to have a mutually aligned business interest in keeping that stream of commerce safe from harm.

In a cynical twist of the old saying about General Motors, when it comes to cross-border commerce, it seems that what is good for the maquila industry in Mexico is also good for Chapo Guzman & Co.’s Narco-Trafficking Inc.

In Juarez, it is those outside that protected zone who do the dying.

Stay tuned …. 


The REDCO report can be found at this link.

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