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New rail hub opens in New Mexico with promise to boost trade, jobs in border region

Rep. Steve Pearce, R-N.M., speaks at the opening of the Union Pacific intermodal terminal in Santa Teresa, N.M., Wednesday, May 28, 2014. Seated at right are New Mexico Gov. Susana Martinez; Chihuahua, Mexico, Gov. Cesar Duarte; and Sen. Tom Udall, D-N.M. At left is Union Pacific CEO Jack Koraleski. The facility spans 2,200 acres and also includes fueling facilities and crew-change buildings. (AP Photo/El Paso Times, Rudy Gutierrez)

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Rep. Steve Pearce, R-N.M., speaks at the opening of the Union Pacific intermodal terminal in Santa Teresa, N.M., Wednesday, May 28, 2014. Seated at right are New Mexico Gov. Susana Martinez; Chihuahua, Mexico, Gov. Cesar Duarte; and Sen. Tom Udall, D-N.M. At left is Union Pacific CEO Jack Koraleski. The facility spans 2,200 acres and also includes fueling facilities and crew-change buildings. (AP Photo/El Paso Times, Rudy Gutierrez)

SANTA TERESA, N.M. - A sprawling, $400 million railroad hub opened Wednesday in southern New Mexico with the promise of transforming the border area into an international industrial trade zone.

The hub is one of the largest of its kind in the U.S. and is expected to spur development on both sides of the border with Mexico. Tax breaks and other factors have prompted more than 50 companies to move to the area in recent years.

Because the area has been designated a foreign trade zone, freight from overseas can be loaded directly onto trains from West Coast ports for processing and shipment to Mexican factories and for distribution by rail across the U.S.

New Mexico Gov. Susana Martinez and her Mexican counterpart Cesar Duarte, the governor of Chihuahua, Mexico, were among the officials on hand for the ceremony that opened the Union Pacific project almost a year early.

"This not only brings freight," U.S. Sen. Tom Udall, D-N.M., said referring to the locomotives and freight cars that served as a backdrop to the ceremony. "This brings new businesses, new jobs, new hope. This is a new chapter in southern New Mexico."

The hub spans 2,200 acres and includes fueling facilities and crew-change buildings. It's located minutes away from the Santa Teresa Port of Entry, which was recently upgraded to handle commercial traffic from industrial parks in Ciudad Juarez, Mexico

By the time the hub reaches capacity in 2025, it will provide hundreds of permanent jobs — a much-needed boost as federal statistics show New Mexico continues to trail the rest of the U.S. in job growth, despite an oil and gas boom in southeastern New Mexico.

"This brings more jobs, 600 permanent Union Pacific jobs," Martinez said.

After the ceremony, Martinez stressed the importance of diversifying the state economy, which is heavily dependent on federal labs and the military.

New Mexico is tied for last with Kentucky in per cent of job growth and is just one of four states where non-farm payrolls contracted or showed negative growth.

"When you have such dysfunction in Washington you start to reduce those (federal) jobs," Martinez said.

The new rail facility is already causing stress on surrounding communities, Udall said, noting the need for housing, management of water resources and development of a labour force.

Known as the Santa Teresa Intermodal Ramp, the hub can handle up to 225,000 containers a year and is poised to beat the initial estimate of 150,000 units in its first year, Union Pacific CEO Jack Koraleski told the crowd of railroad and government officials and business people at the grand opening.

Intermodal transport involves the use of freight containers that can be transported on trucks, railroad cars or ships. The hub opened to truck traffic in April.

At the end of the ceremony, officials used rubber mallets to hammer golden railroad spikes into holes drilled on a wooden plank — the railroad equivalent of using oversized scissors to cut ribbons.

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