What Is The Purpose Of North American Free Trade Agreement

The OBJECTIVE of NAFTA was to remove barriers to trade and investment between the United States, Canada and Mexico. The implementation of NAFTA on January 1, 1994 resulted in the immediate removal of tariffs on more than half of Mexican exports to the United States and more than one-third of U.S. exports to Mexico. Within 10 years of the implementation of the agreement, all U.S.-Mexico tariffs should be eliminated, with the exception of some U.S. agricultural exports to Mexico, which are expected to expire within 15 years. [29] Most of the trade between the United States and Canada was already duty-free. NAFTA also aimed to remove non-tariff barriers and protect intellectual property rights on marketed products. Although NAFTA has not kept all its promises, it has remained in place. Indeed, in 2004, the Central American Free Trade Agreement (CAFTA) extended NAFTA to five Central American countries (El Salvador, Guatemala, Honduras, Costa Rica and Nicaragua). In the same year, the Dominican Republic joined the group in signing a free trade agreement with the United States, followed by Colombia in 2006, Peru in 2007 and Panama in 2011.

The Trans-Pacific Partnership (TPP), signed on October 5, 2015, represented an extension of NAFTA to a much larger extent. A study published in the August 2008 edition of the American Journal of Agricultural Economics found that NAFTA increased U.S. agricultural exports to Mexico and Canada, although most of the increase occurred a decade after its ratification. The study focused on the impact of phase-in periods in regional trade agreements, including NAFTA, on trade flows. Most of the increase in membership agricultural trade, recently entered into the World Trade Organization, is due to very high trade barriers prior to NAFTA or other regional trade agreements. [91] In 2008, Canadian exports to the United States and Mexico totaled $381.3 billion, while imports totaled $245.1 billion. [59] According to a 2004 paper by University of Toronto economist Daniel Trefler, NAFTA provided Canada with a significant net benefit in 2003, with long-term productivity increasing by up to 15 per cent in the sectors that experienced the largest tariff reductions. [60] While the decline in low-productivity jobs has reduced employment (up to 12 per cent of existing jobs), these job losses have lasted less than a decade; Overall, unemployment has declined in Canada since the legislation was passed. Trefler commented on the compromise, saying that the crucial trade policy issue was « how free trade can be implemented in an industrialized economy so that the long-term benefits and short-term adjustment costs borne by workers and others are recognized. » [61] The Clinton administration negotiated an environmental agreement with Canada and Mexico, the North American Environmental Cooperation Agreement (NAAEC), which resulted in the creation of the Commission for Environmental Cooperation (CEC) in 1994. In order to allay concerns that nafta, the first regional trade agreement between a developing and two developed countries, would have negative effects on the environment, the Commission was tasked with carrying out an ex post-post environmental assessment[34] it created one of the first ex-post frameworks for the environmental assessment of trade liberalization, which was to provide a certain amount of evidence regarding the initial assumptions concerning NAFTA and the environment. , such as the fear that NAFTA could create a « race to the bottom » of environmental regulation between the three countries or that NAFTA would put pressure on governments to strengthen their environmental protection. [35] The CEC organized four symposiums on assessing the impact of NAFTA on the environment and requested 47 contributions from leading independent experts on the subject.

[36] The former Canada-U.S. free trade treaty has been the subject of controversy

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