Negative media coverage of Tijuana’s violent crime problems may create potential opportunities for investors in an undervalued market. Those who predict long-term improvements can take advantage of Tijuana’s recent negative press and invest in the market while prices are still relatively low. Those with less confidence may want to avoid Tijuana altogether. Others who expect crime to continue or increase may benefit from investing in Tijuana’s booming “fear industry” of bodyguard services, surveillance and auto armor.
Petty theft and other minor crimes are nothing new for Tijuana, a city of more than 1.2 million people on the border of the U.S. and Mexico. With a constant flux of goods and people moving through the city, some degree of crime is to be expected. But violent crimes in the city—and U.S. media coverage of that trend—have skyrocketed in recent years. A recent USA Today article reports that Tijuana experienced nearly one murder per day and two kidnappings per week in 2006.
Although FBI statistics show that Detroit and Washington, D.C., have higher murder rates than Tijuana, Tijuana’s kidnappings and the involvement of organized crime and even local police are unlike U.S. cities. The Associated Press recently reported that drug gangs “have left a particularly bloody trail in Tijuana, where more than 300 people were slain” in 2006.
Local citizens’ groups claim that more than 150 people were kidnapped for ransom during the last year, with successful local businessmen and their sons the most attractive targets. A recent NPR story reported that fear of kidnapping has caused some families to leave Tijuana’s wealthiest neighborhoods and relocate to the relative safety of nearby San Diego.
Underpaid and highly at risk for standing against strong drug cartels in the area, local police have an obvious temptation to work with rather than against organized crime. Salaries of just $500 to $600 per month offer local police little incentive to risk their lives against drug cartel members. In fact, Mexico’s new president confiscated guns from Tijuana’s 2,300 municipal police for most of January to test for involvement in murders.
Although U.S. citizens are not generally targets in Tijuana’s crime, the U.S. Department of State issued a public announcement in September 2006 about drug-related violence, random shootings and kidnappings in areas of Mexico, including Tijuana. Tourists destined for Mexico’s border towns are warned that “Drug-related violence has increased dramatically in recent months, and shows no sign of abating. While U.S. citizens not involved in criminal activities are generally not targeted, innocent bystanders are at risk from the increase in violence in the streets of border cities.”
Mexico’s recent election offers hope for Tijuana’s crime problem. President Felipe Calderón took office on Dec. 1 and immediately began to follow up on his law and order platform by sending federal military police to problem areas. On Jan. 3, he sent 3,300 soldiers to Tijuana to reduce local police corruption and establish security checkpoints in the city. Calderón appears serious in his efforts to reduce organized crime and police corruption.
Crime may deter some tourism and property values, but it has not entirely offset Tijuana’s advantages. Economically, Tijuana shows promise for growth. Many U.S.-based manufacturers are drawn to Tijuana for its cheap labor and proximity to San Diego. Minimum wage increases in the U.S. will only add to Tijuana’s economic advantage.
For tourists and foreign residents, Tijuana boasts an active nightlife, low cost of living, cheap healthcare, comfortable climate and proximity to beaches and to the U.S. Such factors have already attracted more than 2,500 permanent foreign residents over 65 years of age, according to Mexico’s 2000 Census.
That number may increase dramatically as baby boomers retire—especially if Tijuana’s violent image improves. Retirement communities are beginning to spring up in the Tijuana area, including assisted living communities and other developments. A Trump Baja hotel-condo is in development nearby, offering prices at just a fraction of the other Trump hotel-condo prices.
