Ironic Economic Development

With all the buzz about reshoring American manufacturing jobs, I've been on the lookout for ironic economic development stories. Let's play one of my favorite geography games, "Follow the Natural Resources." Dateline Mexico:

“It is a contradiction in terms that Mexico, a major energy producer, now imports natural gas and gasoline,” says Mr Lozoya. ...

... He pulls out a map that shows one of two new gas pipelines that will bring cheap natural gas south from the US to feed Mexican industry and petrochemical development – especially of fertilisers.

“It is going to boost agriculture and heavy manufacturing, significantly,” he says. Then he adds, arching his eyebrows: “but most important of all, it is a two-way pipeline which will also allow us to send gas the other way.”

Emphasis added. I first stumbled upon this apparent paradox concerning Iran. I read that the country exported oil but imported gasoline. We tend to omit the role of refineries in the energy supply chain, creating a huge blind spot in our understanding of economic geography.

The Financial Times story about Mexico and Pemex should worry manufacturing boosters in the United States. The shale energy revolution is a game-changer. However, the benefits may accrue in ironic locations such as Mexico. A possible scenario is the export of raw resources south of the border and subsequent import of value-added products into the United States. Just something to think about the next time you see sensational headlines about shale gas and oil causing a jobs boom. Where will those jobs be created?