NAFTA, or the North American Free Trade Agreement, is the most significant attempt at regional economic integration.An agreement between the United States and Canada to enter into a free trade agreement took place January 1, 1989 with the goal of eliminating all tariffs between the two countries by 1998.In 1991, talks included Mexico to establish free trade amongst all three countries.By late 1993, the government of all three countries had ratified the agreement.
On January 1, 1994, NAFTA became law.NAFTA has several major points included in its contents, such as abolishing tariffs on 99% of the goods traded between the three countries involved.It would remove most barriers on the cross-border flow of services which would allow financial institutions, among other businesses, unrestricted access to the Mexican market by 2000.It would also protect intellectual property rights and remove most restrictions on foreign direct investment between Canada, US, and Mexico.It would apply national environmental standards, such as those that have a scientific basis and it would establish two commissions with the power to impose fines and remove trade privileges when environmental standards or legislation involving health and safety, minimum wages or child labor are ignored.
People have different opinions regarding the consequences of NAFTA.People arguing for NAFTA feel it should be viewed as an opportunity to create an enlarged and more efficient productive base for the entire region.It is likely that many firms from US and Canada will move some if not all production to Mexico because of the lower labor costs, saving those businesses money.This should increase the incomes of those in Mexico, thereby increasing imported goods from Canada and US.Mexico should benefit because it will receive investments and employment, both are needed a great deal.
There is one big issue confronting NAFTA today, which is a number of oth…

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