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THE NORTH AMERICAN FREE TRADE

AGREEMENT

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WHAT IS NAFTA?

The North American Free Trade Agreement (NAFTA ) is a

trilateral trade bloc in North America created by the

governments of the United States, Canada, and Mexico.

The agreements were signed in December 1993 by the

presidents of the three countries and it came into effect from1st Jan. 1994.

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HIGHLIGHTS

Final provisions (NAFTA) were fully implemented

on January 1, 2008.

NAFTA one of the most successful trade agreements

in history and has contributed to significant increases

in agricultural trade and investment.

Most comprehensive Regional Trade Agreement

signed by the United States.

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TRADE AND INVESTMENT

EFFECTS

NAFTA is a broad agreement.

From 1994 to 2008, U.S. exports to Mexico rose

91%, compared to 41% to the world. U.S. imports

increased by 179%, compared to 89% from the world.

After fourteen years, most tariffs have gone to zero,except for some very sensitive (mostly agricultural)

goods that have limited protection for up to 15 years.

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NAFTA SUPPLEMENTS

The North American Agreement on

Environmental Cooperation (NAAEC)

The North American Agreement on LabourCooperation (NAALC)

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NAFTA IN PERSPECTIVE

U.S. two-way trade with Canada and Mexico exceedsU.S. trade with the European Union and Japan

combined.

In fact, US trades more with Maxico in a month thantrade with other countries in a year. US exports more

to Mexico in a day than with Paraguay in a year.

US exports more in a week with Canada than withCentral America in a year.

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U.S. TRADE IN PERSPECTIVE

2008

$301

$173

$35 $54

$129.6$196.7

$282.6

$411.8

$0

$100

$200

$300

$400

$500$600

$700

$800

NAFTA EU(25) China Japan

Billion$

EXPORTS

IMPORTS

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Top Ten Countries with which

the U.S. Trades

$217

$316

$174.40

$244.50

$0

$100

$200

$300

$400

$500

$600

Cana

da

Mexico

Chin

a

Japan

Germ

any

U.K.

S.Korea

Taiw

an

France

Malaysia

Billon

$

EXPO TS

IMPO TS

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EFFECTS OF NAFTA

BENEFITS.

LIMITATIONS.

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BENEFITS

NAFTA eliminates trade barriers.

Benefits the importers by reduced or duty free goods.

No MPF from Canada for NAFTA goods.

Can make the exporter more competitive then other non-

participating countries.

200% increase in trade among the 3 countries.

Increase market access within each country.

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U.S. NAFTA TOTAL TRADE

1994-2008

$234$241 $265

$293$343

$381$421

$477

$503$562

$657 $612$602

$627$713

$0

$100

$200

$300

$400

$500

$600$700

$800

Billi

1994 1995 1996 1197 1998 1999 2000 2001 2002 2003 2004 2005 2006 2007 2008

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LIMITATONS

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

It has negative impacts on U.S. workers in manufacturing andassembly industries who lost their jobs.

Critics also argue that NAFTA has contributed to the rising

levels of inequality in both the U.S. and Mexico.

Some economists believe that NAFTA has not been enough

(or worked fast enough) to produce an economic

convergence, nor to substantially reduce poverty rates.

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KEY NAFTA PROVISIONS

Sanitary and Phytosanitary Measures

Export Subsidies

Internal Support

Grade and Quality Standards

Rules of Origin

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NAFTA COMPLIANCE TEAM

THREE PERSONs TEAM DEDICATED TO RESOLVINGNAFTA MARKET ACCESS AND COMPLIANCE CASES.

THE TEAM COMBINES EXPERIENCE INUNDERSTANDING NAFTA REGULATIONS WITHSPECIFIC COUNTRY EXPERTISE

TRY TO RESOLVE PROBLEMS BY PERSUADINGFOREIGN COUNTRY TO COME INTO COMPLIANCEVOLUNTARILY, AVOIDING TIME AND EFFORTINVOLVED IN FORMAL DISPUTE SETTLEMENT

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PUBLIC OPINION

Public opinion towards NAFTA in the United States,

Canada, and Mexico is mixed.

The Program on International Policy Attitudes reported in a

poll that 47 percent of Americans thought that NAFTA hasbeen good for the United States, while 39 percent thought it

had been bad for the country

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Impact on Jobs The studies indicate that the reduction in net exports to Mexico

has eliminated 227,663 U.S. job opportunities, in Canada it

has eliminated 167,172 jobs in the same period.

NAFTA resulted in a net loss of 394,835 jobs in its first three

years.

The analysis has found that NAFTA has eliminated significant

numbers of jobs for women and members of minority groups,

as well as white males.

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RECENT NAFTA NEWS

NAFTA Toll Highway Destroying Prime Agricultural Land

The Trans-Texas Corridor (TTC) is no ordinary highway.The toll road would be four football fields wide. It includesseparate lanes (up to six for automobiles, four for large trucks),

plus tracks for freight trains, separate tracks for high-speed andcommuter rail, also space for oil and gas pipelines, electricity

wires, and broadband transmission cables.The implications of this scheme are staggering. Some

experts say that up to a million people in Texas stand to losetheir homes and 584,000 acres of rich farm and ranchland areto be destroyed, all for a privately funded highway.

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CONCLUSION

NAFTA is one of the most successful treatiesof the times in terms of growth in trade i.e. imports &

exports , G.D.P etc. but on the other hand it is alsoresponsible for causalities like loss of jobs, migration,rising level of inequality and many others.

Thus it is important that the treaty should becarried forward concerning about taking steps for the

problems originated due to NAFTA ,otherwise it willcreate inequality in many terms which can lead to badconditions in future for all the three countries.

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