Final answer:
The Mexican equivalent of export processing zones is the Maquiladora, a type of factory that utilizes cheap labor for manufacturing goods mainly for export, benefiting from NAFTA-based trade across North America.
Step-by-step explanation:
The Mexican equivalent of export processing zones is the Maquiladora. These are factories, mostly foreign-owned, that import raw materials or components for manufacturing, assembling, or processing, with the bulk of the finished products destined for export, primarily to the United States. Over 3,000 maquiladoras can be found along the US-Mexican border, taking advantage of the North American Free Trade Agreement (NAFTA) which promotes free trade and industrial activity across North America.
Maquiladoras provide significant employment in Mexico and produce goods at lower costs for US consumers. While these factories offer economic benefits, such as job creation in Mexico and cost savings for US companies, there are concerns about labor conditions, environmental impacts, and the effect on jobs in the US. Moreover, while the maquiladoras have contributed to the growth of Mexican exports and industrial development, especially in the northern part of Mexico, they also challenge Mexico's ability to balance economic growth with social and environmental responsibility.