Objectives Of North American Free Trade Agreement

11 Apr

Many critics of NAFTA saw the agreement as a radical experiment developed by influential multinationals who wanted to increase their profits at the expense of ordinary citizens of the countries concerned. Opposition groups argued that the horizontal rules imposed by nafta could undermine local governments by preventing them from enacting laws or regulations to protect the public interest. Critics also argued that the treaty would lead to a significant deterioration in environmental and health standards, promote privatization and deregulation of essential public services, and supplant family farmers in the signatory countries. According to a 2012 study on tariff reductions on NAFTA, trade with the United States and Mexico increased by only 11% in Canada, compared to a 41% increase in the United States and 118% in Mexico. [63]:3 In addition, the United States and Mexico benefited more from the rate reduction, with an increase in social benefits of 0.08% and 1.31%, with Canada recording a decrease of 0.06%. [63]:4 According to a 2017 report by the New York City Think Tank Council on Foreign Relations (CFR), bilateral agricultural trade tripled between 1994 and 2017 and is considered one of the main economic effects of NAFTA on trade between the United States and Canada, with Canada becoming the largest importer of the U.S. agricultural sector. [64] Fears of job losses in the U.S. manufacturing sector were not due to the fact that manufacturing employment remained “stable”. Given Canada`s labour productivity, which rose to 72% of the U.S.

level, hopes of closing the “productivity gap” between the two countries were also not realized. [64] Two fundamental additions to NAFTA – the North American Labour Cooperation Agreement and the North American Agreement on Environmental Cooperation – have had a significant impact on the effectiveness of the agreement. A 2007 study showed that nafta had “a significant impact on the volume of international trade, but a modest impact on prices and prosperity.” [62] If the original Trans-Pacific Partnership (TPP) were to enter into force, existing agreements, such as NAFTA, would be reduced to provisions that do not conflict with the TPP or require greater trade liberalization than the TPP. [155] However, only Canada and Mexico would have the prospect of becoming members of the TPP after U.S. President Donald Trump withdrew the United States from the agreement in January 2017. In May 2017, the remaining 11 members of the TPP, including Canada and Mexico, agreed to pursue a revised version of the trade agreement without U.S. participation. [156] The political divide was particularly large in terms of views on free trade with Mexico.

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