Reopening of Mexico border will give Dallas an economic boost

The announcement that the U.S. will reopen border crossings with Mexico to ‘nonessential’ travelers after 20 months of COVID-19 imposed restrictions will not only help to reunite families and border communities, but it could also be a boost to the North Texas economy.

The U.S. announced Wednesday that it will allow land crossings from Mexico and Canada to visitors and tourists showing proof of vaccination in early November, just in time for the busiest shopping season of the year, starting with Black Friday.

Dallas-Fort Worth has established itself as one of the preferred destinations for Mexican tourists in the U.S., thanks to its variety of discount and high-end shopping, diversified entertainment and professional sports, abundant restaurants and hotels, and its strategic location in the middle of the country.

According to Visit Dallas, an organization that promotes tourism in Dallas, tourists coming from Mexico spent around $458.1 million in 2019; That figure is about 44% of the overall spending of international visitors in the region.

The organization said it doesn’t have exact figures of revenue lost during the pandemic, it estimates that losses could have been up to 50%.

“We were waiting for this (border reopening) because Dallas is a very accessible market from Mexico. And, naturally, they love coming to Dallas and this will allow them to do it,” said Craig Davis, president of Visit Dallas.

“When Mexican people come and stay in hotels or with friends and family, they spend their money here. This is good news for our residents because a lot of wealth is generated through tourism in Dallas,” Davis said.

The total spending of Mexicans visiting Dallas grew 40% between 2014 and 2019, thanks to a higher number of visits. In 2019 around 1.7 million international travelers came from Mexico, according to Visit Dallas records.

Davis added that even though Dallas has around 20 direct flights with Mexican cities and people have continued to fly in, the area missed out on people traveling by land, since it’s cheaper than buying a plane ticket.

On Tuesday, Secretary of Homeland Security Alejandro Mayorkas said that restrictions on the U.S.-Mexico border would be lifted “within the first days of November” and that tourists fully vaccinated against COVID-19 would be allowed into the United States.

Antonio Payán, director of the Center for the United States and Mexico at the Baker Institute in Rice University, said that the businesses close to the border would experience record earnings during the first weeks of the reopening, even greater than what they were making prior to the COVID-19 pandemic, because of the season approaching.

“Mexicans cross to the U.S. to buy products that are cheaper and have better quality, like clothes or electronics, and right now there’s a lot of postponed demand: people who decided to wait until the reopening to buy,” said Payán. “With Black Friday and Christmas, the timing is perfect, and authorities know that this reopening is part of the economic recovery of border communities.”

Aside from trade and commerce, the links between North Texas and Mexico are deep. Dallas has a sister cities agreement with Monterrey, in Nuevo León, and Fort Worth has a similar relationship with Toluca, near Mexico City. About 80% of the approximate 2.5 million Hispanics who live in the DFW area identify as Mexican or with roots in Mexico.

Cross-border businesses

One of the businessmen that will benefit from the lifting of travel restrictions is Uriel Chavira, owner of Los Paisanos Autobuses. He offers transportation services for Dallas Cowboys fans coming from different cities in Mexico coming to NFL games at the AT&T Stadium.

“We have 120 buses and only 15 of them are circulating,” said Chavira. “The other 105 have not operated in the last 18 months.”

Chavira explained that he has a contract with the Cowboys, which allows him to buy 150 seats every game they play.

The seats are located in four different sections across the stadium and their prices vary depending on the section chosen, ranging between $499 and $799.

The packages he sells to Mexican fans include ground transportation to and from Dallas, one hotel night, the ticket for the game, plus drinks and food during a tailgate party before the game.

The Mexican fans Chavira buses in also contribute to Texas’ economy, because the trip includes stops at different malls in El Paso and Dallas.

“If the border reopens on November 1, like authorities said, we’re ready to bring fans to the game against the Denver Broncos on November 7,” Chavira said.

Jesús Cañas, senior business economist at the Federal Reserve Bank of Dallas, says that the impact of the reopening in the Dallas-Fort Worth region will be marginal and not as major as it is expected in border cities.

“Those with the most purchasing power to come to North Texas do it through air and they never stopped coming,” said Cañas. “More money will come to this region, but because of the size of our economy, it won’t be as significant as it will be in border towns.”

Cañas pointed out that the reopening of the border will economically aid counties at the border at a time when federal aid, such as stimulus checks and unemployment, ended.

Holiday shopping

According to economists, restrictions to Mexican border crossers impacted businesses along the border more severely.

Chris Hernández, owner of three stores in Downtown El Paso, including Krystal Jeans and Hernandez Fashions, said his businesses had never gone through more difficult times than during the pandemic.

“We had gone through difficulties like the peso devaluation (in 1994) and closed streets because of major constructions, but never in the history of the business had the international borders been closed,” Hernández said.

Hernández said that around 70% of his customers come from Mexico and he considers them to be one of his business’ most important economic drivers. When border restrictions began, 70% of his revenue disappeared overnight, he said.

“It was very stressful, scary and there were times of a lot of uncertainty,” Hernández said.

At the beginning he thought the border would open when COVID restrictions relaxed in the city of El Paso, but every month that went by where restrictions were extended made him more and more nervous about his business.

In the 19 months that the border has been closed, the U.S-Mexico border region lost about $20 billion because when Mexican customers stopped crossing to shop in the U.S. side, according to José Iván Rodríguez, a researcher at the Center for the United States and Mexico at the Baker Institute. Rodríguez has closely studied the impact of the border closure.

Texas, he said, would have lost at least $5.7 billion in direct revenue that travelers usually spend in the U.S., without considering other kinds of revenue.

“They’re numbers, but the truth is that, in border communities, people are eager for Mexicans to shop and have fun again in the United States,” said Rodríguez. “Because it means a greater flow of dollars and more jobs for those communities.”

Staff writers Imelda García and Abraham Nudelstejer reported from Dallas; Special contributors María Ramos Pacheco and Marisol Chávez reported from El Paso.