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Chapter Eleven Of NAFTA Summary

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• Reduce Tariffs and Non-Tariff Barriers between Canada, Mexico and the US: In January 1994, the North American Free Trade Agreement (NAFTA) was enacted to allow free trade among Canada, Mexico and the US (Al Jazeera, 2017). The agreement wished to support business transactions between these countries for continued economic success and growth with a focus in agriculture, automobiles, and textiles (NAFTA's Economic Impact, n.d.). Most tariffs between these countries were dissolved ten to fifteen years after the agreement was signed. (Guerrero et al, p. 40)

• The Distribution of Welfare: Reflecting on NAFTA’s success, trade between member countries significantly increased close to four times the pre-agreement quantities. However, these benefits …show more content…

This would allow for more flexibility with air pollution levels and cheaper production for companies.

• Chapter Eleven of NAFTA: Chapter Eleven of NAFTA states that if a business is losing potential profits because of a new environmental rule/law, that company may sue the host country. This gives foreign investors special rights when dealing with production, business, and environmental impacts (Shogren, 2013). The US continues to benefit immensely from this clause:

o The Case of MMT in Canada: In 1997 Canada lost the legal battle with the US over the import MMT, a gasoline chemical, which was originally banned from entry into Canada because of air pollution concerns. Ethyl Corporation, a US chemical company, forced Canada to lift the ban, pay $13million, and apologize because of the negative impact the trade barrier created (Global trade 101, …show more content…

Many resources are pooled together into winning those cases (Shogren, 2013).

• Energy Reform Effects Within NAFTA: NAFTA links the US, Mexico, and Canada with the possibilities of low-cost energy. There are oil sands in Canada and investments in Mexican energy that shows potential for plentiful resources for these countries. It will be difficult to organize regulations on sustainable practices and bring the markets together because of national feelings about oil (Ready to Take Off Again?, 2014).

• NAFTA’s Influence on Natural Resources: Overfishing is a major environmental issue today, reflected in the sharp decline in fish stocks. NAFTA did not heavily impact overfishing because most tariffs between countries were small or nonexistent.

o World Impact: “NAFTA trade flows of fish accounted for 7.5 percent of total fish catch in 1997, while world trade flows accounted for 5.4 percent of world fish catch” (6) That’s a significant difference between NAFTA and the rest of the world. Other factors like foreign relations and exchange rates could impact fishing because of trading, prices, and international demand (Chomo et al, p.

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