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NAFTA

North American Free Trade Agreement

"Implementation of the North American Free Trade Agreement (NAFTA) began on January 1, 1994. This agreement will remove most barriers to trade and investment among the United States, Canada, and Mexico.

Under the NAFTA, all non-tariff barriers to agricultural trade between the United States and Mexico were eliminated. In addition, many tariffs were eliminated immediately, with others being phased out over periods of 5 to 15 years. This allowed for an orderly adjustment to free trade with Mexico, with full implementation beginning January 1, 2008." ("North American Free Trade Agreement (NAFTA).")

NAFTA Customs: NAFTA applies the standerization of each countries customs of verification of records, and rules of origin. This is determined by the NAFTA Secretrariat to ensure as few conflicts as possible and make the importing and exporting process run smoothly without any disruptions. According to Clinton Administration, NAFTA was supposed to reduce the number of illegal immigrants and encourage them to stay at their home country and produce. However, there are problems surrounding NAFTA that are both economic and political. It has been suggested that NAFTA is responsible for the loss of jobs in Canada and the United States as well as a reduction in wages and worker rights. Especially in Mexico, where the farmers are driven off because people would buy more high-quality corn from the US. These problems are all the result of exploitation by large corporations that NAFTA inadvertently made easier.

The signing of the NAFTA agreement gave rise to the only major guerilla-styled insurgency of the late twentieth century. The movement burst on the scene on New Year's Day, 1994 in Chiapas, Mexico, calling for the repel of NAFTA on the day it was scheduled to take effect (Meade 327). Although the Zapatista guerrilla -- composed of average Mayan peasants -- was not successful in getting NAFTA repealed, it raised a lot of international awareness of the negative affects that free trade and neoliberal policies have on the poor. It also spiked a sense of indigenous pride in Mexico.
Zapatistas

Zapatistas in the 1994 guerilla against NAFTA

Nafta fam

The actual effect of NAFTA

Issues associated with NAFTA include job loss, violations of NAFTA terms, and harm to the environment. These issues remain because they have been unchecked by the proper authorities and although they do not compromise the overall purpose and success of NAFTA, they should still be approached in the interest of the large pool of stakeholders related to these issues.

Following other diplomatic aggreements among these countries, they met in San Antonio, Texas on December 17, 1992 to sign NAFTA.

As a result of NAFTA, the World Bank has shown a percentage growth in imports to these countries. Growth in imports help boost the economies in these countries and allows for a better quality of living.

"The study estimated that NAFTA boosted U.S. exports to Mexico (agricultural and nonagricultural) by 11.3 percent in 2001 and U.S. imports from Mexico by 7.7 percent." (Stephen Zahniser and Zachary Crago)

"Mexican wages grew steadily after the 1994 peso crisis, reached pre-crisis levels in 1997; and have increased each year since. Several studies note that Mexican industries that export or that are in regions with a higher concentration of foreign investment and trade also have higher wages." (“NAFTA – Myth vs. Facts”)

As demonstrated by the above quotes, NAFTA is supposedly helpful to the United States. It certainly is boosting exports for American companies (not to mention saving them money by moving production to Mexico, where it's cheaper), but the Office of the United States Trade Representative has also stated that NAFTA has served Mexico as well. But one must bear in mind the source of the above quotes: the United States Government. While Mexican companies might have higher wages in areas with foriegn investment, this does not mean that they are equal to wages in the U.S. This is a large part of the reason American companies in Mexico are so profitable: they are able to pay workers significantly less than they would in the U.S. and with fewer complaints about human rights issues such as reasonable work days or firing policies.


The North American Free Trade Agreement was arguably supposed to reduce the number of illegal immigrants. The Clinton Administration stated, "There will be less illegal immigraion because more Mexicans will be able to support their children by staying home" (Meade, page 326). The agreement was supposed to broaden Mexico's prosperity and create jobs but the effect was the opposite. NAFTA mainly benefited Mexico's wealthy landowners and industrialists and approximately 2 million farmers were driven off the land and into urban centers in search of work because they could not compete with the cheaper, highly subsidized agriculture products from the US and Canada. The agreement led to raising illegal immigration instead of reducing it.

ReferencesEdit

Meade, Teresa A. A History of Modern Latin America: 1800 to the Present. Chichester, West Sussex U.K.: Wiley-Blackwell, 2010. Print.

"NAFTA – Myth vs. Facts. Office of the United States Trade Representative”, 2008. Web. 11 Dec 2010. <http://www.ustr.gov/sites/default/files/NAFTA-Myth-versus-Fact.pdf>.

"North American Free Trade Agreement (NAFTA)." USDA United States Department of Agriculture. USDA, 2 Sept 2010. Web. 11 Dec 2010. <http://www.fas.usda.gov/itp/policy/nafta/nafta.asp>.

Stephen Zahniser and Zachary Crago. United States. “NAFTA at 15: Building on Free Trade”. Economic Research Service, 2009. Web. 11 Dec 2010. <http://www.ers.usda.gov/Publications/WRS0903/WRS0903.pdf>.

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