Mexican cement giant Cemex says it's willing to help with Trump's wall
President Trump's vows to make Mexico pay for a promised border wall - estimated to cost up to US$20 billion - has stirred resentment there, where the country's leader has repeatedly said there will be no such payment.
But the chairman of a Mexico's largest cement company said he would "gladly" consider bidding on the project.
Rogelio Zambrano Lozano, chairman of Mexico-based Cemex, told the newspaper Reforma on Wednesday (Thursday NZ Time) that if asked for a quote, his company would be willing to offer one. So far, no one has asked, a spokesman confirmed.
"If one of our clients asks us to give prices on materials, we have the responsibility to provide it," the spokesman said in a statement, "but it doesn't imply Cemex would participate in the project."
The Department of Homeland Security will begin soliciting bids to design and build wall prototypes as early as Monday, and well over 300 businesses have already expressed interest in taking part. The agency plans to start awarding contracts by mid-April, according to FedBizOpps.gov, a website for federal contractors.
Some Mexicans have taken offence as Cemex's stance, saying the company would be prioritising financial interests over national interests. Others viewed Cemex's potential offer as a logical step that could potentially a Mexican company to reap profits from the border wall project.
In Trump's joint address to Congress this week, he reiterated that "we will soon begin the construction of a great wall along our southern border. "It will be started ahead of schedule and, when finished, it will be a very effective weapon against drugs and crime," Trump said.
He also reiterated his core principle is to "buy American and hire American."
Some analysts have predicted for months that Cemex could see a window of opportunity in the border wall. The company has six integrated cement plants within a 320km radius of the border, more than a number of US rivals.
Research firm Bernstein wrote in a July study that Cemex would be one of the companies best-positioned to profit from a wall. The US is Cemex's biggest market, representing a fifth of its revenue last quarter.
"If The Wall does go ahead, it will almost certainly be built from concrete," analysts wrote in the Bernstein report. "What is less clear at this stage is whether US- or Mexico-based suppliers will benefit. In fact, despite arguments concerning which government will pay for construction, the large quantities of materials required may necessitate procurement from both sides of the border. Cemex appears best positioned regardless, with cement, RMX and aggregates facilities throughout the border region."
The company has seen a positive uptick since Trump was elected, with its shares rising four per cent, analysts say. Cemex climbed 4.3 percent to 17.74 pesos on Wednesday (Thursday NZT) in Mexico City after advancing as much as 4.6 per cent, for the biggest gain within a day in a month, Bloomberg reported. The company had sales of US$13.4 billion last year.
Yet, despite the profitable potential for the project, some analysts say any profit that would come from the wall wouldn't compensate for a possible negative effect on Mexican sales, the Wall Street Journal reported. Participating in border wall construction could damage Cemex's image in Mexico and even lead to a boycott of the company, they said. Mexico still accounts for 38 per cent of Cemex's operating cash flow.
Manuel Bartlett, a senator from Mexico's Labor Party, told Bloomberg in a January interview that it seemed "dishonourable" for Mexican companies to participate in the project.
"They would be putting money above national interests," Bartlett said. "Obviously the wall construction is an offence to Mexico."
In an interview on Good Morning America on Wednesday (Thursday NZT), Vice President Mike Pence emphasised that Mexico would pay for the proposed border wall.
"One of the things people saw last night is that the candidate Donald Trump is the President Donald Trump, and he spoke about those priorities," Pence said. "We're going to build a wall. We're going to enforce the laws of this country."
- The Washington Post