by Kelly Simmons, Managing Editor and Senior Writer
The State Office of Economic Development in Chihuahua is offering low-cost lines of credit of up to $120,000 pesos to businesses in the municipio of Aldama, for expansion projects or to modernize equipment. The credit is being distributed through a program called Integral Support for Micro and Small Businesses (Apoyo Integral a la Micro y Pequena Empresa, Mypes) and is being channeled to municipios where there is a lack of bank credit. One of the purposes of the Mypes program is to decentralize credit services which are currently concentrated in the state's two major cities, Chihuahua and Ciudad Juarez. The State is also undertaking an intensive informational campaign in the municipios of Parral, Cuauhtemoc and Delicias as well as all the other small cities across the state. The State is also working on various projects involving foreign investment in small cities, following the interest raised at the international Borderland Trade Show held in El Paso recently. The Aldama municipal president, Gaston Armendariz, stated that there is a great deal of interest by U.S. businesses, contacted during the Borderland Trade Show, in establishing strategic alliances with local investors in Aldama.
Meamwhile, the number of vendors selling wares on public streets at fixed or semi-fixed locations without the required local and federal permits has jumped 20 percent over the past 15 months throughout Ciudad Juarez, according to data released by the Chamber of Commerce (Camara de Comercio, Canaco). The Chamber estimates that there are around 15,500 informal businesses that represent 77.5 percent of the 20,000 formal businesses declared at the end of 1996. The growth of these businesses outside the law is "alarming" according to Chamber President Nora Elena Yu, and "provokes a vicious circle that sooner or later will have drastic consequences, not only for the formal businesses but also the consumer, tax authorities and society in general". According to Canaco, in the past two years the city has seen an inflation rate of 93.9 percent while the number of informal businesses has grown 82 percent. In 1993 it was estimated that the number of street vendors in Juarez was 8,067.
A national chamber leader, commenting on the issue, stated that while making money to get by is a natural right of people, the activity of street vending has become one of the Republic's most complex problems. During 1996, it was estimated that the amount of taxes and other public income lost to informal street selling represented 1.6 percent of the Gross National Product of Mexico. (Producto Internal Bruto, PIB). And if if the proliferation of street vending continues, the Chamber estimates that by the Year 2000, more than $29,558,000 pesos in taxes and payments will have been evaded. Local business leaders view the problem as unfair competition and point out the impossibility of regulating this type of selling. Street vendors, but especially vendors of food who usually cook their wares at their homes in order to raise more income for their families, represent unfair competition and lack sanitation, hurting established businesses such as restaurants.
Between 1988 and 1995, the number of walking street vendors grew from 561,794 to 1,171,443 throughout Mexico, an increase of 108 percent, while the number of people employed in formal businesses grew only 65 percent. At this rate, it is predicted that by the Year 2000, there will be more than 2,200,000 walking street vendors in Mexico. In Ciudad Juarez, it is estimated that the number of walking vendors represents 25 percent of the total informal businesses in the city, 38 percent are semi-fixed, such as businesses with movable carts, and 30 percent are fixed in a permanent location such as open markets, according to data from the Chamber of Commerce study. Of the 15,500 street businesses across Juarez, 28 percent are said to be food or grocery, 21 percent are clothes and shoes, 13 percent are general merchandise and games, and 25 percent are classified as other. 72 percent of the merchandise being sold on the streets is said to be of national origin and 28 percent is estimated to be derived from contraband imports.
In other news, 13,200 foreigners visited Ciudad Juarez during the holidays surrounding holy week in March, out of more than 103,000 total tourists, the state coordinator for tourism announced in April. The number of foreign tourists visiting the city represents an increase of 14.7 percent over the same period in 1996. The higher numbers of foreign visitors, principally from the United States, during the last week in March brought in an estimated $4 million dollars to the state.
In the last three weeks of March, the hotels in the mountain town of Creel registered a 100 percent occupancy rate, reflecting the growing interest by local Chihuahuenses as well as forieign vacationers in the Sierra Madre, Barranca del Cobre and the Tarahumara native people. Creel is located in the heart of the Sierra where the Tarahumara people live.
Finally, eight Chihuahuan furniture makers attended the largest furniture exposition in the world, "High Point" in North Carolina according to a Diario de Chihuahua report. The Chihuahuan exhibitors represented 60 percent of the total space reserved for Mexican manufacturers at the large expo, held each year to assist large furniture brokers, announced the Chihuahua State Economic Development Department. High Point is an international fair which admits only the most selected furniture makers in the world and not all countries are represented, stated Enrique Terrazas, Economic Development Secretary. The state's major competitors in furniture making include North Baja California, the Federal District and Tlaxcala. According to Armando Martinez, head of the State Exporting Department, furniture made in Chihuahua is already in demand in Japan whose markets are considered the richest and most expensive in the world, but also the most demanding. The most popular lines of Chihuahuan furniture are the rustic type, made of sanded wood and forged iron.
Sources: Diario de Juarez, El Norte