VZCZCXRO0711
PP RUEHCD RUEHGD RUEHHO RUEHMC RUEHNG RUEHNL RUEHRD RUEHRS RUEHTM
DE RUEHME #0804/01 0472059
ZNR UUUUU ZZH
P 162059Z FEB 07
FM AMEMBASSY MEXICO
TO RUEHC/SECSTATE WASHDC PRIORITY 5400
INFO RUEHXC/ALL US CONSULATES IN MEXICO COLLECTIVE PRIORITY
RUCPDOC/DEPT OF COMMERCE WASHDC PRIORITY
RUEAHLA/DEPT OF HOMELAND SECURITY PRIORITY

UNCLAS SECTION 01 OF 02 MEXICO 000804 
 
SIPDIS 
 
SIPDIS 
 
SENSITIVE 
 
E.O. 12958: N/A 
TAGS: ECON ECIN ELTN ETRD EINV MX
SUBJECT: MISSOURI GOVERNOR PROMOTES SMART PORT 
 
 
Summary 
------- 
 
¶1. (SBU) The Governor of Missouri visited Mexico City with a 
delegation to discuss the Kansas City Smart Port, a proposed 
Mexican government customs house in Kansas City.  The group 
met with Ambassador Garza, Embassy representatives, the 
Secretary of Finance accompanied by representatives from 
 
SIPDIS 
Mexican Customs and the Tax Administration Service (SAT) the 
Secretary of Transportation, and President Calderon.  The 
 
SIPDIS 
Governor also participated in a signing ceremony between 
Kansas City Southern de Mexico and the State of Michoacan. 
While Mexican officials were clear that the Smart Port 
project is stalled, and are making demands that include a 
similar facility in Mexico, the delegation remained 
optimistic.  Post anticipates that Smart Port supporters will 
seek to follow-up with Washington. 
 
Kansas City Smart Port 
---------------------- 
 
¶2. (SBU) Kansas City Smartport is a non-profit coalition of 
shippers, exporters, and warehouse operators promoting Kansas 
City as an "inland Port" for multimodal shipping, drawing on 
the city's extensive railroad, highway, air and river line 
infrastructure.  Backers of the initiative have lobbied the 
USG and GoM to station U.S. Customs and Border Patrol (CBP) 
and Mexican Custom officials at the Smartport in Kansas City 
to perform expedited "pre-clearance" customs processing. 
This would allow goods to be shipped directly from Kansas 
City to the Mexican port of Lazaro Cardenas for international 
export, while also allowing goods arriving in Lazaro Cardenas 
to be forwarded to Kansas City for customs clearances, 
without stopping at the border. 
 
Missouri Governor Visits on News of Delay 
----------------------------------------- 
 
¶3. (SBU) On February 11-13, Governor Matt Blunt of Missouri 
visited Mexico City in response to information that the 
project was not moving ahead. The Smart Port Coalition had 
been informed by CBP in Washington that CBP was not 
interested in posting inspectors at the Smart Port, and that 
the Mexican government had not submitted a request to the 
Department of State to negotiate the diplomatic status of any 
Mexican inspectors working there.  The Governor's visit was 
an attempt to continue pushing the project forward with the 
new Mexican administration. 
 
¶4. (SBU) The Governor also used the visit to support Kansas 
City Southern de Mexico and to promote Missouri-Mexican 
trade.  He was the honorary witness during a agreement 
signing ceremony between Kansas City Southern de Mexico and 
the State of Michoacan.  The agreement was for an 80 million 
USD inter-model terminal at the port of Lazaro Cardenas.  At 
the signing ceremony, Kansas City Southern de Mexico 
announced additional investments of 300 million USD. 
 
¶5. (SBU) Accompanying the Governor was his chief of staff, Ed 
Martin; the Director of the Missouri Department of Economic 
Development, Greg Steinhoff; Jr.; President of Kansas City 
Smart Port, Chris Gutierrez; the Chairman of Kansas City 
Smart Port's Board of Directors, John Wagner; Kansas City 
Smart Port Board Members, Ken Hoffman and Al Figuly; and CB 
Richard Ellis Senior Associate for Industrial Services, Brian 
Staton. Also attending meetings were Jose Zozaya Delano, 
President of Kansas City Southern de Mexico and David Eaton, 
Vice President for Corporate Affairs, Kansas City Southern de 
Mexico. 
 
CBP: Thanks but no Thanks 
------------------------- 
 
¶6. (SBU) During Embassy briefings, representatives from CBP 
reiterated that the agency would not participate directly in 
the Kansas City Smart Port project.  They further indicated 
that CBP does not have the resources and manpower to station 
inspectors in Kansas City for pre-clearance.  They informed 
the group that the next step would be to ask the Mexican 
Government to submit a written proposal outlining its 
interest in moving forward with the project.  (Note: The same 
information was previously provided by CBP Headquarters in 
Washington to U.S. Sen. Kit Bond who had inquired into the 
project delay.  End Note) 
 
Tellez and Calderon Provide Generic Support 
------------------------------------------- 
 
¶7. (SBU) During the 15 minute meeting with Secretary of 
 
MEXICO 00000804  002 OF 002 
 
 
Communications and Transportation Luis Tellez, Tellez 
discussed his support for Kansas City Southern de Mexico and 
the continuing strong relations between Mexico and Missouri. 
During the 20 minute meeting with Calderon, who was 
accompanied by Secretary of Foreign Relations Patricia 
Espinosa and Under Secretary for North American Affairs 
Carlos Rico, Calderon did not directly express his backing of 
the program, but said he supports facilitating cross border 
trade and thereby increasing Mexico's global competitiveness. 
 
 
Ministry of Finance Team Wants More than Smart Port 
--------------------------------------------- ------ 
 
¶8. (SBU) The most extensive meeting was with Secretary of 
Finance Agustin Carstens who was accompanied by the Director 
General of SAT Jose Maria Zubiria and Mexican Customs 
Director Juan Jose Bravo. Carstens said that the Mexican 
government is looking forward to economic integration and an 
increase in trade, but deffered to his two directors for 
specific details. Zubiria said he was aware that the project 
request has been going on for several years. He said that in 
order for the Mexican government to move forward and decide 
how much money would be needed to fund such a project, they 
require a comprehensive business plan that would show the 
anticipated traffic of the facility.  Bravo commented that, 
so far, Mexican Customs has not seen the volume necessary to 
sustain the Smart Port and that without information on the 
expected client base it would be difficult for the Mexican 
government to support the project. 
 
¶9. (SBU) Zubiria then said that the Mexican government is 
following developments at CBP, and is looking for ways to 
deal with problems at the border and transportation. He noted 
that the Mexican government views problems for trains 
crossing the border and trucks crossing the border as parts 
of the same problem, and that this problem needs to be 
solved.  He made a direct reference to the inability of 
Mexican trucks to take their loads into the U.S.  He also 
requested the support of the delegation in "promoting a 
similar facility in Mexican so that we (GoM and Smart Port) 
can move on a mutual agreement". Carstens supported this 
position saying that, the project supporters "need to find a 
way to incorporate it with our (GoM) workings with U.S. 
Customs and find a way for the idea to be applied in Mexico". 
 
 
Comment 
------- 
 
¶10. (SBU) Mexican officials were very cordial, although their 
message was that the Smart Port project is not making 
progress.  The Finance Ministry seems to have tied the 
support of Smart Port to broader cross border transportation 
issues and getting a reciprocal agreement.  At a minimum, the 
Finance Ministry may be seeking to use the Smart Port project 
as leverage to get a pre-clearance facility in Mexico. 
Despite the daunting gauntlet thrown by the Mexican 
government, the Smart Port delegation remained optimistic. 
They talked of gaining more congressional backing and 
investing more money to move the project forward. We expect 
Smart Port supporters to raise these issues in Washington. 
 
 
Visit Mexico City's Classified Web Site at 
http://www.state.sgov.gov/p/wha/mexicocity 
GARZA