Last edited 8 days ago by NeilN North American Free Trade Agreement Watch this page NAFTA redirects here. For other uses, see Nafta (disambiguation). This page has some issues North American Free Trade Agreement Tratado de Libre Comercio de América del Norte (Spanish) Accord de Libre-échange Nord-Américain (French) Administration centers Ottawa, Canada Mexico City, Mexico Washington, D.C., United States Languages English Spanish French Membership Canada Mexico United States Establishment - Formation January 1, 1994[1] Area - Total 21,578,137 km2 8,331,362 sq mi - Water (%) 7.4 Population - 2013 estimate 471,964,016 - Density 23.5/km2 54.3/sq mi GDP (PPP) 2013 (IMF) estimate - Total $20.162 trillion - Per capita $42,719 GDP (nominal) 2013 (IMF) estimate - Total $19.951 trillion - Per capita $42,272 HDI (2011) 0.868[2] very high Website nafta-sec-alena.org NAFTA GDP - 2012 : IMF - World Economic Outlook Databases (Oct 2013) The North American Free Trade Agreement (NAFTA; Spanish: Tratado de Libre Comercio de América del Norte, TLCAN; French: Accord de libre-échange nord-américain, ALÉNA) is an agreement signed by Canada, Mexico, and the United States, creating a trilateral rules-based trade bloc in North America. The agreement came into force on January 1, 1994. It superseded the Canada–United States Free Trade Agreement between the U.S. and Canada. NAFTA has two supplements: the North American Agreement on Environmental Cooperation (NAAEC) and the North American Agreement on Labor Cooperation (NAALC). In terms of combined purchasing power parity GDP of its members, as of 2013 the trade bloc is the largest in the world as well as by nominal GDP comparison. Negotiation and U.S. ratification Provisions Impact NAFTAs effects, both positive and negative, have been quantified by several economists, whose findings have been reported in publications such as the World Banks Lessons from NAFTA for Latin America and the Caribbean,[11] NAFTAs Impact on North America,[12] and NAFTA Revisited by the Institute for International Economics.[13] Canada Like Mexico and the U.S., Canada received a modest positive economic benefit as measured by GDP. Many feared declines failed to materialize, and some industries, like the furniture industry, were expected to suffer but grew instead. Canadian manufacturing employment held steady despite an international downward trend in developed countries. One of NAFTAs biggest economic effects on U.S.-Canada trade has been to boost bilateral agricultural flows.[14][unreliable source?] In the year 2008 alone, Canada exports to the United States and Mexico were at $381.3 billion, and imports from NAFTA were at $245.1 billion.[15][unreliable source?] A book written by Mel Hurtig published in 2002 called The Vanishing Country charged that since NAFTAs ratification more than 10,000 Canadian companies had been taken over by foreigners, and that 98% of all foreign direct investments in Canada were for foreign takeovers.[16] Mexico Maquiladoras (Mexican factories that take in imported raw materials and produce goods for export) have become the landmark of trade in Mexico. These are plants that moved to this region from the United States, hence the debate over the loss of American jobs. Hufbauers (2005) book shows that income in the maquiladora sector has increased 15.5% since the implementation of NAFTA in 1994. Other sectors now benefit from the free trade agreement, and the share of exports from non-border states has increased in the last five years while the share of exports from maquiladora-border states has decreased. This has allowed for the rapid growth of non-border metropolitan areas, such as Toluca, León and Puebla; all three larger in population than Tijuana, Ciudad Juárez, and Reynosa. The overall effect of the Mexico–U.S. agricultural agreement is a matter of dispute. Mexico did not invest in the infrastructure necessary for competition, such as efficient railroads and highways, which resulted in more difficult living conditions for the countrys poor. Mexicos agricultural exports increased 9.4 percent annually between 1994 and 2001, while imports increased by only 6.9 percent a year during the same period.[17] One of the most affected agricultural sectors is the meat industry. Mexico has gone from a small-key player in the pre-1994 U.S. export market to the 2nd largest importer of U.S. agricultural products in 2004, and NAFTA may be credited as a major catalyst for this change. The allowance of free trade removed the hurdles that impeded business between the two countries. As a result, Mexico has provided a growing market for meat for the U.S., leading to an increase in sales and profits for the U.S. meat industry. This coincides with a noticeable increase in Mexican per capita GDP that has created large changes in meat consumption patterns, implying that Mexicans can now afford to buy more meat and thus per capita meat consumption has grown.[18] Production of corn in Mexico has increased since NAFTAs implementation. However, internal corn demand has increased beyond Mexicos sufficiency, and imports have become necessary, far beyond the quotas Mexico had originally negotiated.[19] Zahniser & Coyle have also pointed out that corn prices in Mexico, adjusted for international prices, have drastically decreased, yet through a program of subsidies expanded by former president Vicente Fox, production has remained stable since 2000.[20] United States The U.S. Chamber of Commerce credits NAFTA with increasing US trade in goods and services with Canada and Mexico from $337 billion in 1993 to $1.2 trillion in 2011, while the AFL-CIO blames the agreement for sending 700,000 American manufacturing jobs to Mexico over that time.[21] Trade balances The US goods trade deficit with NAFTA was $94.6 billion in 2010, a 36.4% increase ($25 billion) over 2009.[22] The US goods trade deficit with NAFTA accounted for 26.8% of the overall U.S. goods trade deficit in 2010.[22] The US had a services trade surplus of $28.3 billion with NAFTA countries in 2009 (the latest data available).[22] In a study published in the August 2008 issue of the American Journal of Agricultural Economics, NAFTA has increased U.S. agricultural exports to Mexico and Canada even though most of this increase occurred a decade after its ratification. The study focused on the effects that gradual phase-in periods in regional trade agreements, including NAFTA, have on trade flows. Most of the increase in members’ agricultural trade, which was only recently brought under the purview of the World Trade Organization, was due to very high trade barriers before NAFTA or other regional trade agreements.[23] Investment The US foreign direct investment (FDI) in NAFTA Countries (stock) was $327.5 billion in 2009 (latest data available), up 8.8% from 2008.[22] The US direct investment in NAFTA countries is in nonbank holding companies, and in the manufacturing, finance/insurance, and mining sectors.[22] The foreign direct investment, of Canada and Mexico in the United States (stock) was $237.2 billion in 2009 (the latest data available), up 16.5% from 2008.[22][1] Environment For more details on this topic, see NAFTAs Impact on the Environment. Overall, none of the initial hypotheses were confirmed.[citation needed] NAFTA did not inherently present a systemic threat to the North American environment, as was originally feared. NAFTA-related environmental threats instead occurred in specific areas where government environmental policy, infrastructure, or mechanisms, were unprepared for the increasing scale of production under trade liberalization.[citation needed] In some cases, environmental policy was neglected in the wake of trade liberalization; in other cases, NAFTAs measures for investment protection, such as Chapter 11, and measures against non-tariff trade barriers, threatened to discourage more vigorous environmental policy.[24] The most serious overall increases in pollution due to NAFTA were found in the base metals sector, the Mexican petroleum sector, and the transportation equipment sector in the United States and Mexico, but not in Canada.[25] Mobility of persons According to the Department of Homeland Security Yearbook of Immigration Statistics, during fiscal year 2006 (i.e., October 2005 through September 2006), 73,880 foreign professionals (64,633 Canadians and 9,247 Mexicans) were admitted into the United States for temporary employment under NAFTA (i.e., in the TN status). Additionally, 17,321 of their family members (13,136 Canadians, 2,904 Mexicans, as well as a number of third-country nationals married to Canadians and Mexicans) entered the U.S. in the treaty nationals dependent (TD) status.[26] Because DHS counts the number of the new I-94 arrival records filled at the border, and the TN-1 admission is valid for three years, the number of non-immigrants in TN status present in the U.S. at the end of the fiscal year is approximately equal to the number of admissions during the year. (A discrepancy may be caused by some TN entrants leaving the country or changing status before their three-year admission period has expired, while other immigrants admitted earlier may change their status to TN or TD, or extend TN status granted earlier). Canadian authorities estimated that, as of December 1, 2006, a total of 24,830 U.S. citizens and 15,219 Mexican citizens were present in Canada as foreign workers. These numbers include both entrants under the NAFTA agreement and those who have entered under other provisions of the Canadian immigration law.[27] New entries of foreign workers in 2006 were 16,841 (U.S. citizens) and 13,933 (Mexicans).[28] Disputes and controversies See also References Further reading External links Read in another language MobileDesktop Content is available under CC BY-SA 3.0 unless otherwise noted. Terms of UsePrivacy
Posted on: Thu, 20 Nov 2014 23:00:29 +0000
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