San Antonio Express-News (Sunday)
Raised along Rio Grande, IBC Bank exec lobbies today for border policy
During his childhood, Gerald Schwebel lived on both sides of the Rio Grande, in Laredo and Nuevo Laredo. He learned Spanish, then English.
He later served in the U.S. Army, stationed on the German-Czech border and near the demilitarized zone dividing North and South Korea.
It should come as no surprise that borders are kind of his thing.
As the executive vice president of the international division at IBC Bank, he is an expert on the U.S.-Mexico border. He counsels the bank’s customers in both nations, writes articles and gives speeches on border policy, and lobbies the U.S. government for policy changes.
“My wife brought it to my attention: ‘Do you realize that your professional career has always been working on borders?’ ” he said in an interview. “It really hadn’t dawned on me that way.”
Schwebel — who lives in Laredo, where IBC is based — played a role in shaping and passing the North America Free Trade Agreement, or NAFTA, in 1994. At that time, he was chairman of the nonprofit Border Trade Alliance.
“I dedicated almost three years of my life to the promotion” of NAFTA, he said.
Twenty-five years later, he was back at the negotiating table, helping to hatch the United States-Mexico-Canada Trade Agreement, or USMCA, the 2020 update to NAFTA.
He continues to push for changes in border policy — for example, to smooth out the COVID-19 pandemic-battered supply chains that run across the Rio Grande. He holds leadership positions in private sector groups at the state and national levels, including with the U.S.Mexico Chamber of Commerce.
Border issues are important to IBC’s clients, Schwebel said. The bank has 167 branches in Texas and Oklahoma, including in border cities such as McAllen and Brownsville.
“You know, Mexico is Texas’ No. 1 trading partner, and we’ve got to protect that. But we need to have the adequate infrastructure, business environment, connectivity over highways and roads, to provide the flow of those goods and services,” he said. “Our bank has been there. We’ve played a leadership role, being involved at the national level, at the state level, at the local level.”
Schwebel recently sat with the Express-News
to discuss criticisms of NAFTA, his role in crafting U.S. policies and widely held misconceptions of the border. The following has been edited for brevity and clarity.
Q: Do you feel your background gives you a unique perspective on the border?
A:
Definitely. (My grandmother) wanted me to have an education in Mexico and an education in the U.S., so I did my elementary in Nuevo Laredo, where my first language, believe it or not, was Spanish. Then, after elementary, we moved to Laredo.
Q: The border and border policy have become so politicized. What kinds of misconceptions do people have?
A:
There’re several.
It’s hard for someone from outside of the border to really understand what life is on the border. Sometimes, people from outside talk about the border as if it was a different planet. It’s a unique and wonderful experience, having a bicultural experience, a bilingual experience.
Q: IBC has clients on both sides, right?
A:
Absolutely. If you look at the logo of the bank, that’s been there
since 1966, it has a map of the United States and Mexico. It was that logo that really allowed us to go out and deliver a message of the importance — back then — of Mexico to the U.S. and Texas. As the dialogue (grew) of greater trade relations between Mexico and the U.S., and eventually Canada, it became natural for IBC Bank to play a pivotal role in the negotiations.
Q: The border economies are very tied together, right? I imagine your customers, whether American or Mexican, operate on both sides.
A:
The way I like to portray it is it’s a living laboratory of international trade. The first half of my (banking career), I would spend a lot of time talking to U.S. companies that were looking at Mexico as an option for manufacturing. I’m still doing that right now, but in the last 20 years, I’ve been helping a lot of Mexican companies that wish to expand in the U.S., especially in the food sector — most recently, in the pharma sector.
The logistics, the movement of those goods, (is done by) small and medium enterprises.
They’re the nuts and bolts of the supply chain. The way I like to say it is if you see it, if you touch it, if you eat it, if you smell it, it got there on a truck, a train or a plane. It became more evident during the pandemic, the importance of the supply chain. People didn’t know what “supply chain” meant until they stopped receiving their Amazon package on time. As a bank, we help in facilitating those small and medium businesses.
Q: What kinds of challenges are your clients facing when it comes to bringing goods across the border?
A:
The border, we always say, is very resilient. We have 28 ports of entry in Texas alone; we have 49 in the whole southern border. We have expanding trade activity, yet the infrastructure network has not kept up to the demand. Some of the infrastructure is old.
Q: What role did you play in hatching NAFTA and the USMCA?
A:
In the ’90s, I dedicated almost three years of my life to the promotion of (NAFTA). I was president of a border organization called the Border Trade Alliance. We were small businesses, predominantly from the southern border. We joined forces with the U.S. Chamber of Commerce, the Business Roundtable, the Foreign Trade Council, to go out there and lobby.
When President (Donald) Trump came into office, eventually we were invited as part of the U.S. Chamber to join the private sector dialogue. With the USMCA, you had your trade negotiators, you had your technical sector folks, you had your private sector businesses. Then there was IBC Bank. I
was fortunate to be the sole Texas rep in those rounds. It was a great experience being there at the table negotiating and addressing the topics, because of my experience living and working on the border.
Q: How, in your view, did USMCA change things for the better?
A:
You had to bring (NAFTA) up to speed. You now have digital trade chapters — customs and trade facilitation chapters. It did improve it. It enhanced it, modernized it. It is the new and improved version of NAFTA. But it’s also the framework agreement. It’s not an agreement that solves all the problems of our trade, but it improves it and brings more order, adding the latest innovations and technologies.
Q: NAFTA has been criticized a lot over the years. Some say it led to American workers being undermined by cheaper foreign labor. How do you defend it against those charges?
A:
The fundamental component of NAFTA was, like all trade agreements, take care of your workers, take care of your key sectors. In the United States, manufacturing was changing. In the old days, our competitor wasn’t so much China, it was Japan. Within the framework of NAFTA, there was a component that would allow for certain sectors that may have been negatively impacted to (receive) trade adjustment assistance. They would provide funding to retrain (the workers). As always, the government doesn’t always move as swiftly as you would like. Some of those programs were not funded by Congress. Those folks were not able to take advantage of the retraining or move to a different location. It’s not that jobs left the United States and went to Mexico. Companies expanded the workforce of the U.S. and Mexico and Canada in order to become a more competitive region — to compete, quite frankly, with Europe and the Far East.
Q: I’m interested in your thoughts on how to fix border immigration.
A:
Many times, government doesn’t consult with those of us that work and live on the border. Most of the consultations are either in Washington or Austin. Very little dialogue is with the private sector. It is really modifying our immigration and asylum laws. That includes a process of vetting folks that are economic migrants — like they did in Ellis Island, perhaps, many years ago, when we needed workers. Creating processing centers. Adding more immigration judges. Yes, we are a nation of laws, and we need to follow those laws. But we need to have the right laws that meet the demands of today’s economy. That’s what Congress needs to move swiftly. Unfortunately, there’s been a lot of negative rhetoric with little ear to listening to the solutions.
Q: Some Americans are concerned about the recent electoral reforms in Mexico, seeing them as antidemocratic. Do you have any thoughts? Could the reforms harm business conditions?
A:
I think that’s a question that’s been popping up in everyone’s mind. What happens in Mexico is important to us, and what happens in Texas or the U.S. is important to Mexico. We follow the importance of having a democratic ally in Mexico, because what you want is good government involved with good business. If you have bad politics, you will have bad business. The elections that are forthcoming in 2024 will be the first time in many years that we’re going to have elections in the U.S. at the same time as elections of Mexico for presidential candidates.
Q: What are your thoughts as to how we might “de-politicize” the border?
A:
Who else than those of us that live it down here every day? The question is, is there a political will to change the laws? I think, in many respects, it is lacking. Therefore, I think it’s important that we, the private sector, as well as all citizens, convey to the members of Congress and educate them constantly of the role that a sound immigration policy plays in our daily life.