The Pros And Cons Of NAFTA

As citizens of the United States of America, we import billions of dollars of goods from many places, but one of our biggest trade markets is with Canada and Mexico. The trade agreement that we have with these two countries is called NAFTA, which is the world’s largest free trade agreement. (Amadeo) Enacted on January 1st, 1994, the North American Free Trade Agreement has been in effect for almost twenty-four years. ("North American Free Trade Agreement (NAFTA)") Canada’s top exports to the U.S. are live animals and lumber ("Canada") and Mexico’s top exports to the U.S. are avocados, tomatoes, and berries. (Workman) The things that we import from these countries are things that American citizens use everyday, so it isn’t hard to understand why NAFTA’s renegotiation is such a big deal now. Donald Trump’s early days in office, he threatened to withdraw the U.S. from the trade agreement unless a renegotiation was made, but Canada and Mexico agreed, due to NAFTA being outdated. Renegotiations have begun with all three countries, but it hasn’t been the easiest. There are seven rounds that are currently set. The rounds began on August 16th 2017 and are planned to still be going on through March of 2018. (Amadeo)

Things on his list of changes include lowering the trade deficit, eliminating unfair subsidies, and for state owned companies, like Mexico’s company Pemex, to operate more like private corporations. (Amadeo) Pemex is a company out of Mexico that is a source of national pride. Along with President Trump’s proposals, the U.S. Commerce Secretary Wilbur Ross also has his own ideas. Among these are a five year sunset clause that would force the signatories to recommit every five years, along with his idea of updating the rule of origins. The rule of origins states that “62 percent of the parts of car’s sold in North America must come from the continent.”