NAFTA: Achievements and Challenges
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Code : ITF0016
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Region : :US Canada Mexico |
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Introduction: The ‘NorthAmerican Free TradeAgreement’ (NAFTA), a regional agreement between the US, Canada andMexico, signed in December 1992, came into effect fromJanuary 1994. In 1994, the trade between the three countries was $109 billion, and by 2000 it increased to $622 billion, with a trade volume of $1.7 billion1 per day. NAFTAalso had a positive effect on the three individual economies. In the US, the agreement resulted in creating more than two million2 new jobs a year (between 1994 and 2000). Foreign direct investment between Canada and the US increased by more than 100% between 1994 and 2002, with the US investments in Canada reaching $153 billion and Canadian investments in the US totalling to $92 billion3 by 2002. InMexico, the increase in foreign trade was 76%of itsGDP (between 1994 and 2000), as compared to 37% (between 1985 and 1993).4 These were some of the achievements in the portfolio of NAFTA, whose raison d’etre, was to lift all the trade barriers5 between the signatory states, by 2008. “Everybody recognised that NAFTA was an extraordinary bold attempt to accelerate economic integration, as critics put it, an experiment in reckless globalisation.”6 Although the agreement had a positive impact on the trade between the three nations, critics believed that it had to confront certain challenges before achieving its objectives. |
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