MAQUILADORA

byname maquila any manufacturing plant that imports and assembles duty-free components for export. The plant owner is thus able to take advantage of low-cost labour and to pay duty only on the value addedthat is, on the difference between the value of the finished product and the sum total value of the foreign-made components. The vast majority of maquiladoras are owned and operated by Mexican, Asian, or U.S. companies. Maquiladoras originated in Mexico in the 1960s, with many of the plants located in the border towns of northern Mexico. While they provided employment and significant foreign-exchange earnings for Mexico's developing economy and helped U.S. manufacturers compete with the prices of goods produced by low-wage labour outside the United States, they also created competition for U.S. workers. By the mid-1980s Japanese companies had begun to participate in the maquiladora system, and other Asian investors soon followed suit. A number of Latin American countries, as well as Asian countries, had instituted maquiladora systems by the end of the 20th century, and maquiladora employment in Mexico increased from approximately 200,000 in the mid-1980s to more than 1,000,000 in the late 1990s. The great majority of maquiladora workers in Latin America are women, and in some areas children are also employed. Most of the plants are not unionized. In the mid- to late 1990s several maquiladoras in Honduras, Mexico, and the Dominican Republic were criticized for substandard working conditions, excessively long workweeks (up to 75 hours, without overtime), and environmental pollution.