The North American Free Trade Agreement was created in January 1994 to eliminate
tariffs and other barriers involved in trade between Canada, Mexico and the United States.
This agreement was first initiated by President Ronald Reagan and George H.W. Bush but
was signed officially by President Bill Clinton, Mexican President Carlos Salina and
Canadian Prime Minister Jean Chrtien. It is the most comprehensive regional trade
agreement ever negotiated by the U.S. NAFTA was created after CUFTA, which is the
Canada-U.S. Free Trade Agreement; CUFTA was implemented in January of 1989. It was
an agreement created between Canada and the United States to eliminate barriers in
export-import and to decrease tariffs. NAFTA is very similar to CUFTA with a few
changes. The key goals of NAFTA were those of CUFTA but also included creating an
expanded and safe market for goods and services produced in North America, helped
establish clear and mutually advantageous trade rules and also helped to develop and
expand world trade and create broader international cooperation.
There are many benefits for consumers and businesses. U.S. consumers gained lower
prices and improved quality in goods and services while also receiving greater choices for
those goods and services. In the U.S. marketplace, economic stability improved and the
marketplace was increasing more by supply and demand rather than by barriers to
commerce. U.S. businesses gained a larger North American market with the elimination of
tariffs, gained new export and investment opportunities, and effective procedures to
resolve trade disputes. With NAFTA in place, unemployment rates went down. “Jobs
increased from 311,000 in 1993 to 2.3 million in 1996.” (UNT)
According to more recent sources, NAFTA has helped increase export and import activity
between Canada, Mexico and the U.S. but it hasn’t been able to generate jobs and create
the regional integration which was promised by those who initiated the idea. This is an
ongoing argument between those who have full faith in NAFTA and those who are
completely against it. In 2003, the Congressional Budget Office “attempted a full-scale
examination” of NAFTA’s economic results in the U.S. This examination concluded that
trade between the U.S. and Mexico was growing before NAFTA was even implemented
and that the direct effect on the U.S.-Mexico trade was very small which also resulted in
the U.S. gross domestic product expanding very slightly. A great example of how NAFTA
has helped is that manufacturers have benefitted greatly. The reduction of tariffs and
