Monday, March 29, 2010

Retailers fear drug violence could spoil Semana Santa

As we have talked about in class, the violence and the reports on it are legitimately feared to bring economic stagnation. Here's a report on that fear.


-Racheal

McALLEN — The week between Palm Sunday and Easter are usually among the most profitable weeks in Rio Grande Valley retail, but this year shopkeepers fear Reynosa’s mounting bloodshed might forestall a "Christmas in April."
"We’re going to find out next week," Jorge Salcines, owner of downtown’s McAllen Sports, said late last week. "Nobody really knows. I think people will come. I really do."
Next to Christmas, Holy Week’s retail sales are typically the best of the year as thousands of Mexican nationals from as far away as Mexico City flood into the Rio Grande Valley. Sales in McAllen in 2008 were 14 percent higher in April than the monthly average, according to sales tax receipts with the Texas Comptroller’s Office.
Early signs are mixed. So far, traffic at the area’s international bridges has held steady despite the gun battles and hotels are nearly booked on South Padre Island.
Early indications were not as good in Hidalgo County. Hotels sat emptier than usual.
"There are no reservations," said Rocky Patel, owner of Edinburg’s Super 8 motel. "Compared to the last few years, it’s not good."
Even in 2009, the second year of the recession, the holiday’s retail sales were 8 percent above the monthly average, according to statistics from the comptroller. The sales were estimated by looking at sales tax receipts received roughly two months after the holiday.
Beyond the violence concerns, the other worry is with Mexico’s fragile economy, which, despite signs of recovery, contracted in January for the first time in five months. Job losses at maquiladoras in northern Mexico have also been high."

Read the rest of the story HERE

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