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Voicing optimism about trade prospects in Central America, Gov. Deval Patrick said Tuesday he hopes to help establish a direct flight between Boston and Mexico City this year.
“We hope to close before the end of this calendar year on a direct flight,” Patrick told business leaders gathered at an Associated Industries of Massachusetts breakfast event. Patrick told reporters he is in discussions with two carriers - Interjet and AeroMexico – about a non-stop connection.
Mexico is the Bay State’s third largest international trading partner after Canada and China, and trade with Mexico is growing three times as fast as it is with those other countries, said AIM President Rick Lord. Mexico purchases 7 percent of Massachusetts products purchased oversees, Lord added.
Patrick visited Mexico in March, his first trip there as governor, and said he was struck by a “remarkable change in regulatory framework” that will allow for a “radically different” approach to generating electricity.
“Over there, there are no dogmas,” said Ramon Alberto Sanchez Pina, assistant director of the sustainability and environmental management program at Harvard University’s Division of Continuing Education.
Sanchez Pina said leaders in Mexico are willing to hear arguments for how change would benefit health and the environment, not just the bottom line. He said Mexico is seeking a dramatic increase in the amount of renewable energy used in the country, and suggested power generators in America would be less willing to consider changes to benefit the environment than those in Mexico.
“One thing I sensed… is that Mexican business leaders and to some extent government leaders feel that we as a nation have underestimated or undervalued the opportunity to do business in Mexico,” said Patrick, who likened the growth potential to that of Google and Facebook when they were fledgling companies. He said, “We have many, many, many more opportunities to seize.”
Paul Sellew, founder of Harvest Power, said he had gone on the trip with Patrick and determined Mexico City with its 25 million people and the largest produce market in all of Latin America holds potential for the company that turns organic waste into fuel and fertilizer.
“We have a real live project,” said Sellew, who is in discussions with potential partners in Mexico where he said landfills are filled to capacity. He said, “It was a very successful trip.”
The state Republican party has at times used Patrick’s trade missions overseas to question his focus on problems back home in Massachusetts. Patrick visited Singapore, Hong Kong and Japan late last year, and in March he traveled to Panama and Mexico.
Patrick said Mexican Consul General in Boston Daniel Hernandez Joseph was “absolutely persistent” encouraging Patrick to travel to Mexico.
“I think we are a nation of opportunities for Massachusetts,” said Hernandez Joseph, who said the country has embarked on fiscal reforms, plans to boost its investment in research and development to 1 percent of gross domestic product, and made changes in its energy policy. Hernandez Joseph said Mexico has gone from the state’s sixth largest trading partner to third largest and Mexico is opening a trade office in Boston.
Illegal immigration from and through Mexico has been the subject of intense debate on the national level and within U.S. border states where there are also worries about the power of criminal drug rings that have a foothold in the northern part of Mexico.
Panelists said businesses seeking to enter the market in Mexico should establish themselves in the country and find local partners.
Paula Murphy, director of the Massachusetts Export Center, a government agency, told the News Service the small businesses she assists generally have challenges in the international marketplace marketing overseas, finding partners and maneuvering through regulations, especially when technology could have a military use.
Patrick has sought to boost the domestic economy in part by offering new means for foreign students to stay in Massachusetts as business people, proposing a global entrepreneur in residence program in partnership with local educational institutions for international students that are eligible but unable to obtain an H-1B visa due to the federal cap.
Lord said AIM supports Patrick’s visa proposal, but said most companies in the group, which generally represents large corporations and manufacturers, are opposed to another of the governor’s proposals to ban non-compete clauses in contracts. Non-compete clauses are legal tools that can prevent employees from working at another company in the same field for a period of time.
“Many companies say to us it’s important for us to protect confidential information and intellectual property. This is a tool we use in order to do that, and doing away with them will make us more vulnerable to people leaving and taking trade secrets with them,” Lord told the News Service. He said, “There’s been legislation to either eliminate or reduce non-compete agreements for the past five or six years,” but the bills had never gained traction.
The Patrick administration has argued that non-compete clauses, which have been banned in California, can stifle innovation and the governor has proposed other measures to protect trade secrets.
Patrick met in Mexico with the son of Carlos Slim, one of the world’s richest men and a philanthropist through the Carlos Slim Foundation.
“We see some opportunities there,” Patrick told reporters when asked about that meeting.