Roughly fifteen year ago the United States entered into an agreement with its neighboring countries Canada and Mexico. With the incarnation of this intercontinental free trade agreement; the United States acting as the conduit would not only increase trade productivity for itself but, allot its sister nations to the north and south the same advantages. The North American Free Trade Agreement (NAFTA) is beneficial to America because, it encourages the expansion of job opportunities, abolishes taxes and tariffs that can restrict the flow of imports and exports, and supplies the States with goods and services at lower costs causing profits to increase exponentially. To put you in the right frame of mind the, year is 1991. George H. W. Bush is president, Operation Desert Storm came and went, and prior to the signing of NAFTA, the only trade agreement resembling it in North America was the Canadian-United States Free Trade Agreement (CUSFTA). With CUSFTA coming into its junior year, President Bush was getting ready to launch another trade agreement involving the United States and Mexico. With talks already under way between President Bush and Mexican President Carlos Salinas De Gortari outlining the agreement. Canada was beginning to conjure up fears within its own administration that this new trade agreement between the United States and Mexico might cause CUSFTA to take a back seat. These fear-mongers main campaign point was that this agreement with Mexico would cause cheap Mexican labor to undercut the Canadian work force, slowing trade with Canada to a trickle. So, with this fear firmly griping Canadian political and economical big wigs, Canada requested to participate in what would become NAFTA in 1994. Beside the purpose tha... ... middle of paper ... ... Inst For Intl Economics. NAFTA: A Decade of Success | Office of the United States Trade Representative. (n.d.). Office of the United States Trade Representative. Retrieved July 14, 2010, from http://www.ustr.gov/about-us/press-office/fact-sheets/archives/2004/july/nafta-decade-success SICE: Trade Agreements: North American Free Trade Agreement. (n.d.). SICE the OAS Foreign Trade Information System. Retrieved July 14, 2010, from http://www.sice.oas.org/trade/nafta/naftatce.asp The Case Against Free Trade: GATT, NAFTA, and the Globalization of Corporate Power (An Earth Island Press Book). (1993). California: North Atlantic Books. Radcliffe, B. (n.d.). The Basics Of Tariffs And Trade Barriers. Investopedia.com - Your Source For Investing Education. Retrieved July 17, 2010, from http://www.investopedia.com/articles/economics/08/tariff-trade-barrier-basics.asp
After three years of debate NAFTA was established in 1994. Fears concerning NAFTA included job creation, loss and transfer, wages and infrastructure. (Ganster/Lorey 188-189) However, with the implementation of NAFTA the economy grew. Ganster and Lorey reveal that bilateral trade increased by $211.4 per year from 1989 to 2004. Commerce grew by 20 percent in the first six months of 1994. There were advantages and disadvantages of NAFTA, nevertheless, NAFTA “intensified the integration of the two economies rather than distancing them.” (Ganster/Lorey 190)
The United States is Canada's largest trading partner and is the largest market for Canadian goods. The Canada-U.S. Free Trade Agreement (1989) and the North American Free Trade Agreement (1994) have both been crucial to increasing market opportunities for Canadian exporters in the U.S.
The main goal of NAFTA agreement was to eliminate trade barriers and open the door for investment among the member countries - the U.S., Canada, and Mexico. The differences between the economies of three countries presented the big space for benefiting from the agreement. Thus, Mexico took advantage of improving economic situation in the country and reducing the poverty rate by creating more workplaces. The U.S. and Canada got an access to enter Mexican market and hence the opportunity to align export and import procedures with the country. North American Free Trade Agreement (NAFTA) allowed Mexico to speed up the economy development process in the country. Due to the increase of the investment into industrial and services sectors of the country, the unemployment rate was reduced, and the overall level of GDP increased. NAFTA allowed exporting the goods from America and Canada to Mexico with the tariffs and trade barriers eliminated. The Mexico got an access to enter the U.S. market, which represents 80% of Mexican export. However, NAFTA has both advantages and disadvantages. Still, there are some disagreements between the countries regarding the free
The North American Free Trade Agreement—NAFTA—was an important agreement signed between three countries—the U.S., Mexico and Canada. NAFTA played an important role between each of these countries’ relations with one another through imports and exports. Throughout the presidential elections throughout the years, NAFTA has been highly debated on whether or not it has helped benefit the economy of these countries or if it has caused a lot detrimental issues. NAFTA promised many benefits for these countries, but not all of their promises were carried through; many views across the political spectrum also have their indifferences about NAFTA.
Prior to NAFTA (Inc. April 2006), “… tariffs of thirty percent or higher on export goods to Mexico were common, as were long delays caused by paperwork…. NAFTA addressed this imbalance by phasing out tariffs over 15 years. Approximately 50 percent of the tariffs were abolished immediately when the agreement took effect, and the remaining tariffs were targeted for gradual elimination.” According to Kimberly Amadeo (2015), article 102 of the NAFTA agreement outlines its purposes which is to “Grant the signatories Most Favored Nation status, eliminate barriers to trade and facilitate the cross-border movement of goods and services, promote conditions of fair competition, increase investment opportunities, provide protection and enforcement of intellectual property rights, create procedures for the resolution of trade disputes, and establish a framework for further, trilateral, regional, and multilateral cooperation to expand the trade agreement’s benefits.”. This quotation, condenses the agreement by stating that the intentions of NAFTA which was an agreement created to ease trade on imports and exports, by eliminating tariff barriers, in order to encourage competition and venture opportunities. Although, free trade is supposed to bring wealth, strength, and prosperity it should also
In 1993, the North American Free Trade Agreement (NAFTA) was signed by President Bill Clinton. It was said that Clinton hoped the agreement would encourage other nations to work toward a boarder world-trade pact. In 1994, the agreement came into effect, creating one of the world’s largest trade zones between United States, Canada, and Mexico.
In December of 1992, Presidents Salinas (Mexico), Bush (U.S.) and Prime Minister Brian Mulroney of Canada signed the North American Free Trade Agreement (NAFTA). The Mexican legislature ratified NAFTA in 1993 and the treaty went into effect on January 1, 1994, creating the largest free-trade zone in the world.
Roberts, Russell. (2006). The Choice: A Fable of Free Trade and Protectionism. New Jersey: Prentice Hall.
Tariff - Definition and More from the Free Merriam-Webster Dictionary. (n.d.). Merriam-Webster Online. Retrieved November 14, 2010, from http://www.merriam-webster.com/dictionary/tariff
The idea and policy implementation of economic integration in North America was never a new one at the time of NAFTA’s ratification. Dating back over one-hundred years ago during the Presidency of William Howard Taft, President Taft had signed into law a reciprocal trade agreement with then Canadian Prime Minister Sire Wilfred Laurier. Free Trade at the time was a polarizing issue in Canada and the deal was stifled after Canadians voted Sir Wilfred out of office. Fifty years later during the Lyndon Johnson Administration, the United States and Canada had jointly signed into law the U.S.-Canada Automotive Products Agreement that liberalized trade in cars, trucks, tires and other crucial automotive parts between the two neighboring countries
In December 17, 1992 George H. W. Bush of the United States, Manuel Salinas of Mexico, Brian Mulroney of Canada all came to an agreement over this iconic trade deal that would bring economic advantages for the three countries. The goals of the agreement were to integrate Mexico’s economy
Globalization has become one of the most influential forces in the twentieth century. International integration of world views, products, trade and ideas has caused a variety of states to blur the lines of their borders and be open to an international perspective. The merger of the Europeans Union, the ASEAN group in the Pacific and NAFTA in North America is reflective of the notion of globalized trade. The North American Free Trade Agreement was the largest free trade zone in the world at its conception and set an example for the future of liberalized trade. The North American Free Trade Agreement is coming into it's twentieth anniversary on January 1st, 2014. 1 NAFTA not only sought to enhance the trade of goods and services across the borders of Canada, US and Mexico but it fostered shared interest in investment, transportation, communication, border relations, as well as environmental and labour issues. The North American Free Trade Agreement was groundbreaking because it included Mexico in the arrangement.2 Mexico was a much poorer, culturally different and protective country in comparison to the likes of Canada and the United States. Many members of the U.S Congress were against the agreement because they did not want to enter into an agreement with a country that had an authoritarian regime, human rights violations and a flawed electoral system.3 Both Canadians and Americans alike, feared that Mexico's lower wages and lax human rights laws would generate massive job losses in their respected economies. Issues of sovereignty came into play throughout discussions of the North American Free Trade Agreement in Canada. Many found issue with the fact that bureaucrats and politicians from alien countries would be making deci...
The first approach of “Free Trade” came on September the 26th 1985 when Bill Mulroney, the Canadian Prime Minister and leader of the Canadian Progressive (socialist) Conservative Party met with American President Ronald Reagan to discuss the possibility of creating a free trade compact with the U.S.A. On October the 4th 1987 the essential negotiations came to a conclusion creating the first draft of a North American Free Trade Agreement. On January the 2nd 1989 America and Canada sign the first draft of a “Free Trade Agreement” creating the possibility of merging all of North America’s economies to compete in the global market. With the probability of Mexico entering the agreement and the idea of cheap labor for both Canadian and A...
Preserve Articles. http://www.preservearticles.com/201012291888/disadvantages-of-free-trade.html. Accessed December 1, 2011. Net “Benefits of free trade” Economics Help http://www.economicshelp.org/trade/benefits_free_trade.html Accessed November 29, 2011.
NAFTA or the North American Free Trade Agreement was an agreement signed by the United States, Mexico and Canada. The agreement created various trilateral rules which would determine the course of trading activities in the region and the benefits that would emerge as a result of the trade. There are various aspects that are characteristic to the agreement reached by these three nations depending on the variables that are characteristic of the individual nations. The agreement has helped the three nations develop rapidly by eliminating various factors that limit aspects like trade and development.