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m A trilateral trade bloc in North America created by the governments of the

United States, Canada, and Mexico.
m The agreements were signed in December 1993 by the leaders of the three
countries:
m Brian Mulroney of Canada.
m Carlos Salinas de Gortari of Mexico.
m Bill Clinton of the United States.
m Did not come into effect until January 1, 1994.
m As of 2008 the trade bloc is the largest in the world and second largest by
nominal GDP comparison.
m One of the most powerful, wide-reaching treaties in the world.
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 Countries do not have trade at the intersecting point on
this graph because each is producing less than if they had a ͞comparative
advantage͟ - producing a good or service at the lowest cost.
The new line shows the number of goods and/or
services that can be produced if the two countries specialize in those goods and/or
services that they have comparative advantage --- consumers can have more of two
goods at a cheap price.
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£ Ñliminates tariffs.
£ Ñveryone benefits because goods are at a lower cost.
£ The most underdeveloped country/partner gains the most - we
help them develop.
£ Ñconomic liberalization.
£ Ñffects :Privatization, less governmental control; Increased
competitiveness; Higher specialization resulting in a shifting of
Sectors (example: Corn in Mexico); Lower costs to consumers
£ Believes in freedom from governmental controls and the role of
the state in protecting those rights. Believes that natural market
forces should determine economic activity.
ΠIn 1998, Mexico replaced Japan (which has an
economy 11 times its size) as the No. 2 trading
partner with America. In less than 10 years it will
be número uno, replacing Canada.
ΠHowever, 40% of its population lives on less than
$2 a day.
6ox met with President Bush on Sept. 4th and proposed a very broad
agenda: legalizing anywhere from 3 to 7 million illegal immigrants,
expanding temporary migration from Mexico, increasing cooperation in law
enforcement, especially against drug trafficking, and organizing a binational
committee to promote development in the poorer regions in Mexico.

A week prior to 9/11, the discussion focused on ways to facilitate integration

and the movement of people and of goods. On 9/11, the borders were
virtually shut down. In the immediate term, 9/11 has had a profound effect
on both Mexico and Canada. Both countries had come to rely on freer trade
with the United States, with U.S. exports and imports approximately 85% of
their total trade, and thus any impediments introduced at the borders had a
very deleterious effect on the two coutries͛ economies.
 T The following is a listing of goals as set forth
in NA6TA͛s preamble:
9 To strengthen bonds of friendship and
cooperation
ͻ To act as a catalyst to international
cooperation
9 To create, expand, and secure future
markets , To establish fair rules of trade
9 To ensure a predictable framework for
business planning , To enhance firms
competitiveness in foreign markets
9 To foster creativity and innovation
,create new employment opportunities
9 To promote development & strengthen
environmental regulations
 NA6TA IN PÑ SPÑCTIVÑ

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 Top Ten Countries with which the U.S. Trades



  


  
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 Ñ66ÑCTS O6 NA6TA
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m NA6TA eliminates trade barrier

m Benefit͛s the importers by reduced or duty free goods.

m Can make the exporter more competitive then other non-participating

countries

m 200% increase in trade among the 3 countries.

m Increase market access within each country.

 Ñ66ÑCTS O6 NA6TA
m 


m It has negative impacts on farmers in Mexico who saw food prices fall
based on cheap imports from U.S. agribusiness

m It has negative impacts on U.S. workers in manufacturing and

assembly industries who lost jobs.

m Critics also argue that NA6TA has contributed to the rising levels of
inequality in both the U.S. and Mexico.

m Some economists believe that NA6TA has not been enough (or
worked fast enough) to produce an economic convergence, nor to
substantially reduce poverty rates
 oÑ
NA6TA P OVISIONS

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m ules of Origin
 Impact on Ñmployment

m The study's indicates that the reduction in net exports to Mexico has
eliminated 2,27,663 U.S. job opportunities since 1993, and the
reduction in net exports to Canada has eliminated 1,67,172 job
opportunities in the same period. In total, NA6TA resulted in a net
loss of 3,94,835 jobs in its first three years.

m The analysis finds that NA6TA has eliminated significant numbers of

jobs for women and members of minority groups, as well as white
males. Between 1993 and 1996, women lost 1,41,454 jobs to NA6TA,
blacks lost 36,890 jobs, and Hispanics lost 22,520 jobs, numbers
closely reflecting these groups shares in manufacturing industries
' '" 
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m Ñquivalent of 6 million min. wage jobs

m That money - the nation's third largest source of income, behind oil and
tourism - has not only provided relatives money for food, clothing and
medicine
m MISSOU I 6rom 1990 to 2000, Missouri͛s Latino population increased by
92.2%. 40% of this population lives in the West Central region, with 30%
living in Jackson County
m 40 percent of Missouri͛s Latino population lives in the West Central
region, with 30 percent living in Jackson County
 ' + 
m Two agreements.
1. One was the North American Agreement on
Ñnvironmental Cooperation (NAAÑC), which
created a commission to enforce environmental
law. But the commission was not fully staffed
until 1995 and has had a slow start.
2. The other agreement created the Border
Ñnvironment Cooperation Commission and the
North American Development Bank to address
pollution problems along the U.S.-Mexican border.
mCurrently, NA6TA trade contributes significantly to air
pollution in all the corridors. Truck idling associated with
border crossing delay contributes significantly to CO
emissions, particularly in corridors where border delay is
problematic. As much as 6% of all trade-related CO
emissions in the corridors are caused by truck idling.
 m
 
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Much like the Canadian 6TA was expanded to
NA6TA...
The negotiation with Central America will
complement the goal of completing a 6ree Trade
with the Americas (6TAA) by Jan. 2005.
The U.S. exported $9 billion in goods to the five
Central American countries in 2001, up 42% since
1996. The U.S. is the main supplier of goods and
services to Central American economies: 40% of
total goods imports by CA come from the U.S. U.S.
products face a competitive disadvantage in the
region, because CA countries have been very
active in negotiating free trade agreements that
do not include the U.S. More than 20 trade
agreements grant preferences in CA to products
from Mexico, Canada, Chile, and several South
American nations.
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m Public opinion toward NA6TA in the United States,

Canada, and Mexico is mixed. A survey conducted by
CIDÑ and COMÑI in Mexico showed that 64 percent
of the Mexican public favored NA6TA.

m The Program on International Policy Attitudes

reported in a poll that 47 percent of Americans
thought that NA6TA has been good for the United
States, while 39 percent thought it had been bad for
the country .
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NA6TA is one of the most successful treaties of the times in

terms of growth in trade i.e. imports & exports , G.D.P etc. but
on the other hand it is also responsible for causalities like loss
of jobs, migration, rising level of inequality and many others.

Thus it is important that the treaty should be carried forward

concerning about taking steps for the problems originated
due to NA6TA ,otherwise it will create inequality in many
terms which can lead to bad conditions in future for all the
three countries
 eferences

Πhttp://en.wikipedia.org/wiki/North_American_6ree_Tra
de_Agreement
Πhttp://www.nafta-sec-alena.org
Πhttp://www.export.gov/fta/nafta/doc_fta_nafta.asp
Πhttp://www.sice.oas.org/trade/nafta/naftatce.asp
Œ http://www.canadianeconomy.gc.ca/Ñnglish/economy/1
994NA6TA.html