Pros And Cons Of Nafta

NAFTA stands for The North American Free Trade Agreement. It is an agreement among the United States, Canada and Mexico designed to remove tariff barriers between the three countries. It became effective in 1994. NAFTA covers the market access, Trade rules for goods and services, investment rules, intellectual property and dispute settlement. NAFTA is essentially a tariff agreement designed to facilitate trade and ensure that North American producers receive preferences over goods not originating in the U.S., Canada or Mexico. NAFTA brought some benefits to the economies of the U.S but when a regulation changes, it can be difficult to determine which changes in the economy were directly caused by the regulatory change, and which were caused indirectly or by unrelated factors.

It was argue that the NAFTA cons outweigh it pros. From 1994 to 2012 the U.S imports and exports percent grown. ”U.S. exports to Canada and Mexico have climbed 201 percent and 370 percent, respectively and the value of imports into the U.S. from Canada and Mexico has jumped by 194 percent and 621 percent, respectively.” (Glassman, 2013) Since NAFTA, the U.S had negative impacts as well. “The U.S. trade deficit with Mexico has grown dramatically, from a trade surplus of $4 billion in 1993 to a deficit of $54 billion in 2012. Yet in most industries, corporate profit margins have risen over that period. Recently, the U.S.’s deficits with Mexico and Canada have contracted as export growth has accelerated.” (Glassman, 2013) The U.S lost billions for dollars due to