FILE - In this Dec. 3, 2018 file photo, Mexico's President Andres Manuel Lopez Obrador holds his first news conference as president, which started at 7 a.m. local time in Mexico City. Lopez Obrador has published a financial disclosure form on Thursday, Jan. 3, 2019, that reveals relatively few possessions and the fact that his wife makes more than he does. (AP Photo/Christian Palma, File)

Mexico launches plan to stimulate US border economy

January 05, 2019 - 2:12 pm

MEXICO CITY (AP) — President Andres Manuel Lopez Obrador has launched an ambitious plan to stimulate economic activity on the Mexican side of the U.S.-Mexico border despite recent U.S. threats to close the border entirely.

Mexico plans to slash income and corporate taxes to 20 percent from 30 percent for 43 municipalities in six states just south of the U.S., while halving to 8 percent the value-added tax in the region. Business leaders and union representatives have also agreed to double the minimum wage along the border, to 176.2 pesos a day, the equivalent of $9.07 at current exchange rates.

Lopez Obrador says the idea is to stimulate wage and job growth via fiscal incentives and productivity gains. President Donald Trump has repeatedly complained that low wages in Mexico lure jobs from the U.S.

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