interesting facts about nafta: The Facts on NAFTA: Assessing Two Decades of Gains in Trade, Growth, and Jobs


Sales remain high, with August 2021 recording $3.4 billion in sales alone, more than the entire first six months. Considered the new disruptor to the art market, NFTs are making waves in a sector previously occupied exclusively by traditional investors. Marketplaces like OpenSea, Nifty Gateway, and SuperRare are now bringing artists like Trevor Jones and Fewocious together with investors looking for the next big thing. With over 1.4 million daily unique users and over $1.2 billion in sales in July of 2021 alone, the market is bursting with opportunity. Things that would normally only be available in one country became available to the people of all three. Specialty things, especially when pertaining to agriculture, became available.

Total merchandise trade between Canada and the United States more than doubled between 1993 and 2016, while trade with Mexico increased eightfold over the same period. Similarly, many feared losing high-paying manufacturing jobs in Canada and the United States to Mexico. By comparison, response among the Mexican public was limited, partly because many were disillusioned with the economic nationalist model that contributed to the debt crisis of the early 1980s. As well, the country was still ruled by a semi-authoritarian regime and the public had little access to independent information.

This caused 12% of Mexico’s Foreign Direct Investment to leave the country. The United States, which holds more than half of all direct investments in Mexico, arranged a peso-rescue package of as much as $13 billion which helped to stop the downward spiral of the peso. This devaluation should have little direct impact on the United States except that some companies may find Mexico is even more attractive to move to. Commercial lending rates and credit card interest rates in Mexico have almost doubled and hover around 40% and inflation is expected to reach 20%. These factors are expected to impact the poor and middle class of Mexico the most and possibly cause more unrest in the already unstable areas .

Canada was the target of the most suits under this provision of the agreement, with a total of 41 claims brought against Canada between 1995 and 2018, comprising 48 per cent of the total claims made. Canada paid out more than $219 million in damages after losing or settling eight cases. Mexico lost five cases, resulting in payments of more than US$205 million. By May 2020, four cases brought against Canada remained undecided, with claims representing more than $775 million in damages. In addition, the labour and environmental side accords represented a significant innovation, requiring that each partner respect its own laws. However, since they were located outside the main text of the agreement, they lacked effective enforcement mechanisms.

Opinions on the success of NAFTA vary, mostly depending on each person’s basic beliefs about the role of government in the economy. While NAFTA has generated growth for all three countries involved, the growth didn’t come without a cost, including lack of environmental regulations and loss of jobs here in the U.S. While there are no official plans to renegotiate or eliminate NAFTA, the impact of trade disputes and price wars – like those with tomatoes in the 2000s – will be seen in the years to come. For all that, most studies conclude that NAFTA has had only a modest positive impact on U.S. GDP. For example, according to a 2014 report by the Peterson Institute for International Economics , the United States has been $127 billion richer each year thanks to “extra” trade growth fostered by NAFTA. For the United States, with its population of 320 million at the time of that study, the pure economic payoff was thus only $400 per person, while per capita GDP was close to $50,000.


Many interesting facts about nafta shifted from the United States to Mexico, as higher-paying factory jobs moved to more cost-effective regions. This was especially true in lower-skilled industries such as the automotive or textile industries. In 1999, the Christian Science Monitor wrote of an Arkansas town that it “would collapse, some said, like so many NAFTA ghost towns that lost needle-trade and manufacturing jobs to places such as Sri Lanka or Honduras.” Overall, NAFTA was neither devastating nor transformational for Canada’s economy. Opponents of the 1988 free trade agreement warned that Canada would become a glorified 51st state.

Auto – Tariffs – Canadian views

The major reason that illegal aliens enter this country is for economic reasons. With the establishment of new manufacturing facilities and an increase in the standard of living the result should be lowered amounts of illegal immigration . The political turmoil in Mexico has added a great deal of controversy to the issue.

  • America also has a lot of bilateral trade agreements with specific countries.
  • NAFTA access is most crucial for agriculture, where Mexico has its highest MFN tariffs.
  • While Canada and the United States had already been trading under the Canada-United States Free Trade Agreement, NAFTA went even further to eliminate trade barriers between the US and Canada.

Ford Motor Company alone has spent $2.2 billion to upgrade its car and truck manufacturing plants. This surge in auto manufacturing has caused a boon for machinery and equipment manufacturers in the United States. Exports to Canada for this type of equipment have risen 500% in the last decade. Canadian exports to the U.S. grew by 21% in 1994 and are expected to have another double digit increase this year. Ontario alone imported more U.S. goods than our second largest trading partner .

NFTs are most likely here to stay

The stock of Canadian direct investment in Mexico has increased dramatically since NAFTA entered into force, reaching nearly CA$16.8 billion in 2016, up from only CA$530 million in 1993. Canada and the U.S. have one of the world’s largest investment relationships with a bilateral investment stock totalling more than CA$866.4 billion in 2016, according to Canadian statistics. The NAFTA’s provisions ensure greater certainty and stability for investment decisions by guaranteeing fair, transparent and non–discriminatory treatment of investors and their investments throughout the free trade area.

middle class

The https://1investing.in/ was signed in November 2018 and ratified by all three countries as of March 2020. Supporters sometimes cite oil exports as evidence that NAFTA has helped Canada. According to the Observatory of Economic Complexity, the U.S. imported $37.8 billion worth of crude oil in 1993, with 18.4% of it coming from Saudi Arabia and 13.2% of it coming from Canada. They have also contributed to the growth of a small, educated middle class. In 2013, it was reported that Mexico had approximately 4.9 engineering graduates per 1,000 people, compared to 3.6 in the U.S. Still, the decline in garment prices is no easier to pin directly on NAFTA than the decline in garment manufacturing.

Mexico’s turmoil since NAFTA

Most Democrats and Democratic leaners (58%) think that NAFTA benefits the U.S. and Mexico about equally. Just 16% of Democrats think Mexico benefits more – less than half the share of Republicans who say this. About half of Republicans and Republican-leaning independents (53%) say Mexico benefits more. That compares with 31% of Republicans who say NAFTA benefits the two countries about equally and 7% who say the U.S. benefits more than Mexico. In 1994, 14 percent of people in Mexico lived on less than $2 per day.


This practice is evident in the textile industry and will be discussed later. While on the surface it seems that a free trade area would always be a good thing, it is easier said than done. The majority of people that oppose NAFTA do so because of the potential for loss of employment. Mexico with its cheap work force will tend to make manufactures requiring extensive manual labor more likely to move to the lower cost area. A loss of sovereignty may also be a stumbling block, since some economic policy decisions are taken out of the governing bodies’ hands.

That impact, they say, is not always easy to disentangle from other economic, social and political factors that have influenced U.S. growth. The North American Free Trade Agreement was an economic free trade agreement between Canada, the United States and Mexico. Designed to eliminate all trade and investment barriers between the three countries, the free trade agreement came into force on 1 January 1994.

Jan. 1, 2014 marks 20 years since the North American Free Trade Agreement , a landmark treaty which tore down trade barriers between the United States, Mexico and Canada, came into effect. It’s easy to point fingers at Mexico but the facts are that Mexico did not come to the US looking to steal US jobs. The fingers really point back at the US where excess taxation, over regulation, severe environmental issues, US court systems, increasing union demands and an increasing lack of qualified employees drove US manufacturing to China and Mexico. Exploration of NAFTA Facts uncovers that the singular largest loss of US manufacturing jobs has been attributable to automation, technology and robotics. When one views the Detroit automobile assembly lines of the 60’s and compares them to today’s fully automated robotic assembly lines it becomes painfully evident that 90% of the human workers are no longer there.

Exciting Job Opportunity at the Canadian Consulate – San Francisco.

Two decades ago, when NAFTA was born, China had only a faint presence in the global economy, and was not yet even a member of the World Trade Organization. However, the share of U.S. spending on Chinese goods rose nearly eight-fold between 1991 and 2007. By 2015, U.S. trade in goods and services with China totaled $659 billion— with the U.S. importing $336 billion more than it exported. China has become the U.S.’s top trading partner for goods — a development never anticipated at the signing of NAFTA.

Advantages and Disadvantages of NAFTA

Never before has a major economic power like the United States considered a free trade area with an under-developed third world country. Back in the early 1990s, the North American Free Trade Agreement was one of the hottest political issues in the country. When he was running for president in 1992, Bill Clinton promised that NAFTA would result in an increase in the number of high quality jobs for Americans that it would reduce illegal immigration. He warned that if NAFTA was implemented there would be a “giant sucking sound” as thousands of businesses and millions of jobs left this country. Well, it is 20 years later and it turns out that Perot was right and Clinton was dead wrong.

After more than a year of negotiations, Canada and the US reached an agreement in principle on 1 October 2018. The renegotiated trilateral agreement was given a new title, the Canada-United States-Mexico Agreement . Several political and economic factors over the course of the 1980s and into the 1990s led to the creation of NAFTA.

President Barack Obama cancelled the SPP in 2009, however, partly because of growing criticism of the process for being non-transparent and lacking democratic accountability. 20-Export-related jobs pay 13% to 18% more than the national average. 14-From 1999 to 2015, Canadian investment in the U.S. totaled $2.9 trillion. 12-Motor vehicle parts cross the border border six to eight times before they are made into cars in the U.S.

Real U.S. manufacturing output rose 30% from 1993 to 2016, even as employment in the sector plummeted. Isolating NAFTA’s effects is also difficult due to rapid technological change. The supercomputers of the 1990s boasted a fraction of the processing power of today’s smartphones, and the internet was not yet fully commercialized when NAFTA was signed. Meanwhile, Japan saw its share of U.S. imports decline from 19% to 6% from 1993 to 2015. In real terms, Canada’s sales of oil to the U.S. grew 527% over that period, and it has been the U.S.’s largest supplier since 2006.

There have been fears about the loss of jobs that NAFTA could cause in these countries, legal disputes regarding some exports, and concerns about its environmental and social impacts. President Obama already suggested that NAFTA may have had a negative impact in employment in some sectors and areas of the country. Most recently the Republican candidate for the White House, now President elect Donald Trump, has accused NAFTA of being “the single worst trade deal ever approved” in the United States. Hillary Clinton brought up the idea that NAFTA may need to be amended.

Ha Le Viet
Ha Le Viet

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