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Maquiladoras (North American Free Trade Agreement (NAFTA)

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After the Cold War, the field was sowed for globalism to be planted among the countries of the world. Its roots grew and were used to bring together a world that was separated. In the eyes of historians, globalism is seen as a double edged sword that has benefits and drawbacks in a nation’s economy, environment, and social structure. According to ABC-CLIO, the definition of globalism is “...the growth of systems and activities of economic and commercial production, trade, and services on a global scale” that is a result of collaboration between nations.

In 1993, President Bill Clinton and Congress drafted NAFTA (North American Free Trade Agreement), which was designed to benefit the economies of Canada, Mexico, and the United States. Its preamble …show more content…

A prime example of this is the trade that occurred between Mexico and the United States. Multinational corporations invested in Mexican resources such as their labor. Large American businesses such as At&t, Chrysler, General Motors, PepsiCo, and Johnson & Johnson, benefitted from the cheap labor and low production costs that they got from outsourcing to Mexico.

In the Mexican cities of Ciudad Juarez, Matamoros, and Tijuana, many maquiladoras were established. Maquiladoras came from the word “maquila” meaning assembly fee. American companies would get raw materials and export them to the maquiladora. From there the maquiladora would make the end product which was most likely clothing, electronics, or textiles. They would then ship it back across the border.

This arrangement benefited Mexico’s economy greatly and resulted in maquiladoras making up 15% of Mexico’s GDP (Gross Domestic Product) in 1997. This business further boomed in 2000, since 3,500 maquiladoras were established and housed 1.3 million employees (“ABC-CLIO”). Because of the low labor costs, every year, American businesses that outsourced saved $30,000 per worker, which allowed them to make more

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