This website uses cookies to ensure you have the best experience. Learn more

Nafta In January 1994, Canada, The United States And Mexico Launched The North American Free Trade Agreement (Nafta)

1690 words - 7 pages


In January 1994, Canada, the United States and Mexico launched the North American Free Trade Agreement (NAFTA) and formed the world's largest free trade area. Designed to foster increased trade and investment among the partners, the NAFTA contains an ambitious schedule for tariff elimination and reduction of non-tariff barriers, as well as comprehensive provisions on the conduct of business in the free trade area. These include disciplines on the regulation of investment services and intellectual property. It also includes provisions for ethical standards. We will also discuss several different views as to the benefits as well as some negative effects of the agreement.
Before ...view middle of the document...

While these provisions are included in NAFTA for their trade implications, they in effect encompass ethical concerns that belong in corporate codes of ethics. Some of the main provisions of this unparalleled agreement deal with environmental protection. The agreement states that each party is to implement the provisions of the agreement so that "there will be a progressive elimination of all tariffs on goods qualifying as North American."(Litka, 242) Also, NAFTA's ample employment protections are particularly important since Mexico does not enforce the liberal labor guarantees of its constitution that otherwise bear many similarities to U.S. and Canadian labor laws. NAFTA also promotes action to further the two main concepts of fairness and respect for others by promoting free trade, environmental and cultural integrity, and the prevention of actions that fall in the category of foreign corrupt practices as defined by U.S. law (e.g., bribery and money laundering) (Nelton, 12). Among the principles that expand upon the concepts of fairness and respect for others are: Respect for the Rules, Support for Multilateral Trade, Respect for the Environment, and Avoidance of Illicit Operations. From a society's point of view, if these principles are compromised, then corrective action is important. Making incorrect choices concerning employment, trade, intellectual property or environmental protection will lead to undesirable consequences, such as child labor, unfair trade practices, pirating of copyrights and environmental pollution. These actions have undesirable consequences at a societal level. In today's society, organizations are expected to be responsible citizens at home. In our global economy, organizations must also be responsible citizens abroad. This responsibility is enforced by laws and sanctions which organizations must respect or suffer the consequences of legal action.

The free trade that NAFTA has established among the United States, Mexico, and Canada has greatly benefited the U.S. economy. During the years from 1994 to 1997, U.S. trade with Mexico and Canada rose 44 percent. This extensive growth is accredited primarily to the reduction of tariffs. As tariffs were lowered, U.S. goods became cheaper and more competitive in Mexican and Canadian markets, and at this lower price level the quantity demanded of U.S. goods increased. Therefore it becomes less expensive for U.S. firms to supply goods to Canada and Mexico as the supply curve shifts upward. In order to meet the new demand, the firms must hire new workers and increase investment. Between 1994 and 1997, 90 to 160 thousand jobs were created in the U.S. due to the increase of trade with Mexico, and 2.4 million jobs were dependent upon trade with Mexico and Canada (Harbrecht 12). The increase in employment and investment then leads to increased national income. The work of NAFTA has also served to benefit Mexico's economy; in accordance with the United States' economy, Mexico's...

Other Papers Like NAFTA In January 1994, Canada, The United States And Mexico Launched The North American Free Trade Agreement (NAFTA)

Canada vs the United States Essay

981 words - 4 pages bonus, opportunity, and extra money the Federal Government has to offer. The BC provincial government has come up with the idea to adopt another currency. Of course it would be an obvious decision to adopt the American dollar, because they trade with them the most. Surely you can guess that it would be logical for BC to join the United States for now they would share a currency and the western U.S. is more in tune with their way of

Awakening Of The United States-It's About How The United States Launched Itself To The History Of Warfare

1020 words - 5 pages Britain could not stop Hitler's plan and attack without the help of U.S. Because of this, United States aided the British by giving 50 old American naval destroyers in return for the right to maintain American bases in Newfoundland, Bermuda, and the British West Indies. Roosevelt also set a program called cash-and-carry policy in which Great Britain could borrow money for their supplies. Because of this policy, the British enabled to import U.S. food

Free Trade Agreement Of Americas

2587 words - 11 pages is losing its technological edge to countries like Japan, mainly as a result of the U.S. dedication to free trade. These advocates argue that foreign competition has forced many U.S. high-tech firms into bankruptcy or out of the business of producing certain goods.Some manufacturers and opponents of free trade argue that cheaper labour in foreign countries forces American companies to move their operations overseas. They say that in the long run

Free Trade Agreement And Its Affect On Canadian Business

1354 words - 6 pages this deal: whether Canada will prosper or become the 51st. American state. This paper will not take this approach to the issue of whether or not it is a wise agreement, but will look at what business can do to better itself with the existing FTA. If Canadian business is to survive and prosper in this radically changed North American and Global atmosphere of easier trading, then it must adapt. Some of the main areas that will have to be

The Importance Of International Trade To The United States

960 words - 4 pages marked with the purpose of saving domestic jobs inside the United States. The result of this policy would be costly to consumer and not beneficial to the United States because the United States is a global power in the international trade market. References Bruce, Mary, (2009), “'Buy American' Provision Draws Fire”. Retrieved from: Kelley, Martin, (2011), “What Is the Smoot-Hawley Act?”, Retrieved from:

United States Trade Sanctions Imposed on China

2374 words - 10 pages barriers against Chinese products sighting that some of Chinese trade policies are unfair. The weakened Yuan in relation to US dollar has also an economic implication that makes products manufactured and produced in the United States to be more expensive compared than those produced in China (Dianne, 2005). The general outcome of such this situation is that Chinese products have a higher competitive advantage over the American commodities because of

The North American Agreement on Environmental Cooperation

1004 words - 5 pages proposal a two decades ago to advance regional integration by negotiating a North American Free Trade Agreement (NAFTA) provoked sharp reaction by the environmental community. US environmental groups argued that increased industrial growth in Mexico, spurred by trade and investment reforms, would further damage Mexico’s environmental infrastructure; that lax enforcement of Mexican laws would encourage “environmental dumping”; and that increased

Pro's And Con's Of NAFTA

1494 words - 6 pages Many of the pros of NAFTA were more in theory than in practice, though some do believe that is has improved the North American economies. Mexican President Vincente Fox said "It gave us jobs. It gave us knowledge, experience, technological transfer."Here are some of the major advantages which were used as arguments in NAFTA's defense.Comparative Advantage: The idea that everyone benefits when countries produce and sell freely what they do most

Race and Inprisonment in the United States

1687 words - 7 pages victimized the black man in the “get tough on crime” and the “war on drug” movements. And finally, this paper will address how continued discrimination affects peoples’ ability to change. Race and Imprisonment in the United States Statistics show that African-American men make up 13.6 percent of the U.S. population and 40.2 percent of the U.S. prison population. Even though rates of drug use and selling are similar across the races, people of

Children and Poverty in the United States

1851 words - 8 pages ways to help fight poverty in the United States and if every American could donate just an hour a week, it would make a huge difference in many lives. References Hearts and Minds. (March, 2007). Children in Poverty-America’s Ongoing War. Retrieved on June 20, 2013, from James R. Wood. (July/August, 1982). Poverty in America. Retrieved on June 20, 2013, from http

Racism in the United States

2197 words - 9 pages treatment of Asians saw one of its lowest moments when Japanese Americans were interned into camps by the United States government in 1942 in the wake of Pearl Harbor. People considered of Hispanic descent have also been targeted by systematic, racist policies. After the Mexican-American War, the United States annexed much of the current Southwestern area from Mexico, and the Mexican population found themselves subject to racism and discrimination

Related Essays

The North American Free Trade Agreement

763 words - 4 pages The North American Free Trade Agreement (NAFTA) an agreement which allows international trade between the United States, Mexico, and Canada without the penalties of import and export taxes was approved by the American, Mexican, and Canadian Governments between November 1993 and January 1994. There were several very good objectives in mind when developing the idea for the NAFTA, but as history has told us, ideas never work as well in reality

North American Free Trade Agreement Essay

3105 words - 13 pages Тhе Nоrth Аmеriсan Frее Тradе Аgrееmеnt сrеatеd a prеfеrеntial tariff arеa amоng thе Unitеd Ѕtatеѕ, Canada, and Mеxiсо bеginning оn January 1, 1994. Hоwеvеr, thе drivе fоr rеgiоnal есоnоmiс сооpеratiоn had bеgun aѕ еarly aѕ 1851 with bilatеral frее tradе nеgоtiatiоnѕ bеtwееn thе Unitеd Ѕtatеѕ and Canada. А frее tradе arеa invоlving thе Unitеd Ѕtatеѕ and all оf Latin Аmеriсa waѕ advосatеd by U.Ѕ. ѕесrеtary оf ѕtatе Jamеѕ Blainе in 1881. Тhе

The United States And South Korea Trade Agreement

596 words - 3 pages state and South Korea did. Asian nation was the third-largest market for U. S. beef exports. But American beef exports plunged after an outbreak of mad-cow disease in 2003 which scared the Asian nations. In the spring of 2008, a few weeks after taking office, President Lee Myung-bak decided to lift a ban on U.S. beef in return to the United States agreed to exclude South Korea’s rice industry from the trade agreement. Rice represents about half

Free Trade Agreement Analysis

951 words - 4 pages FTA Rules Question #2 Since January 1st, 1994 all FTA rules were replaced by NAFTA rules of origin. They differ in the respect that they are much clearer and predictable than those of the FTA. Similar to the FTA each member country of NAFTA is able to keep in use its own external market tariff. This external tariff can be in the form of a most favoured nation (MFN) tariff in which the NAFTA