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What did you learn about the topic that most surprised you.docx

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This image shows the benefits NAFTA has had on Canada. NAFTA allows Canadian companies to expand and grow by being able to sell their products to Mexico and to the U.S for cheaper amount due to not having traffics which allows consumers to buy the products for cheaper.

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This image shows how much NAFTA has helped Mexico by having more jobs and helped the economy along with helped Canada and U.S access to having cheaper labor and lower prices for consumer goods. This image has taught me that Mexico has benefited a lot from this deal even when farmers were out of business, they got access to different jobs.

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This image shows a markings of how NAFTA has benefited Canada. As you can see it says that 4.9 million jobs were created since the agreement and Canada's GDP has increased to 1.1 Trillion. This image has taught me that NAFTA was a good deal and should stay so that countries can work together and help create more jobs.

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Website #3 (NAFTA: What it is, how it benefits Canada) 

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Website #3 (NAFTA: What it is, how it benefits Canada) 

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This website has discussed more specifically towards NAFTA on Canada. Having NAFTA has benefited Canada in many ways. For example, the website talks about the development of new jobs that NAFTA as allowed due to having increased trade volume among the three countries. This allows companies to grow bigger and creating more jobs in the process. One interesting thing i learned from this website was that, with NAFTA it allowed wider selection of goods to come to Canada. For example, due to having cheaper labor in Mexico, Canada has benefited by having cheaper goods and larger variety due to increased volume of trades and increasing opportunities for companies to expand.

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NAFTA: What it is, how it benefits Canada, part 1

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As Canada, the U.S. and Mexico renegotiate the North American Free Trade Agreement (NAFTA), this background will help you understand why it matters.

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Website #2 (Why NAFTA's Six Advantages Outweigh Its Six Disadvantages) 

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Website #2 (Why NAFTA's Six Advantages Outweigh Its Six Disadvantages) 

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This website discusses the pros and cons of NAFTA and how the pros outweigh the cons. The information talks about how NAFTA has brought 5 million jobs but has also lost 682,900 jobs in some states. This was due to big companies such as Ford, going to Mexico for cheaper labor. However, it has allowed Canada to have cheaper oil, food, health care services. The interesting fact i have learned from this website is that the farmers in Mexico were out of business due to not being able to compete with the U.S and Canada. I always thought that Mexico had more land to grow crops and would have benefited.

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When it was approved in 1993, the North American Free Trade Agreement was the world's most comprehensive free trade agreement. It covered the United States, Canada, and Mexico. In 2020, its member economies generated approximately $26.67 trillion in gross domestic product.

NAFTA was also controversial. Politicians don't agree on whether the free trade agreement's benefits outweighed its drawbacks. Learn more about what those pros and cons are.

Key Takeaways

Pros and Cons of of NAFTA

Pros Explained

NAFTA has six main advantages, according to a Congressional Research Service report prepared in 2017.

Increased trade: NAFTA more than tripled trade between Canada, Mexico, and the United States after it was enacted. The agreement reduced and eliminated tariffs.

Increased economic output: Greater trade increased economic output. The U.S. International Trade Commission found that full NAFTA implementation would increase U.S. growth by as much as 0.5% a year.

Created jobs: NAFTA's stronger growth created jobs. According to a 2010 report, U.S. free trade agreements-the lion's share of which stemmed from NAFTA-directly supported 5.4 million jobs. Trade with these countries also supported 17.7 million jobs.

Foreign direct investment (FDI): This kind of investment has more than tripled. The United States increased FDI in Mexico from $15.2 billion in 1993 to $104.4 billion in 2012, and from $69.9 billion in Canada in 1993 to $352.9 billion in 2015. Mexico ramped up investment in the United States by 1,283% over the same time period, while Canada's FDI increased by 911%.

Lower prices: NAFTA lowered prices. U.S. oil imports from Mexico cost less because NAFTA got rid of tariffs. That reduced America's reliance on oil from the Middle East. Low-cost oil means lower gas prices. This creates lower costs of living, including lower food prices.

Helped government spending: NAFTA helped with government spending. Each nation's government contracts became available to suppliers in all three member countries. That increased competition and lowered costs.

Cons Explained

NAFTA has six main disadvantages.

Job losses: Certain estimates indicate that it led to job losses. A 2011 report from the Economic Policy Institute estimated a loss of 682,900 jobs. California, New York, Michigan, and Texas were among the hardest-hit states. Though the estimated job gains exceed those lost, certain industries were particularly impacted. These included the manufacturing, automotive, textile, computer, and electrical appliance industries.

Lower wages: Job migration suppressed wages. Companies threatened to move to Mexico to keep workers from joining unions. Without the unions, workers could not bargain for better wages. This strategy was so successful that it became standard operating procedure across many industries.

Farmers out of business: NAFTA put Mexican farmers out of business. It allowed U.S. government-subsidized farm products into Mexico. Local farmers could not compete with the subsidized prices. As a result, some statistics estimate that 1.3 million farmers were put out of business. Though NAFTA was meant to create enough high-wage jobs in Mexico that immigration would decrease, Mexican immigration to the U.S. increased by 79% from 1994 to 2000. The recession drove that figure to 6.9 million in 2007. In 2017, it fell to 4.9 million, roughly double where it was before NAFTA.

Poorer working conditions: Unemployed Mexican farmers went to work in substandard conditions in the maquiladora program. Maquiladora is where United States-owned companies employ Mexican workers near the border. They cheaply assemble products for export back into the United States. Employment in maquiladoras reached 1.2 million in 2006.

Environmental damage: U.S. companies degraded the Mexican environment to keep costs low. Agribusiness in Mexico used more fertilizers and other chemicals. This increased levels of pollution. Rural farmers were forced into marginal land to stay in business, which increased deforestation rates. That deforestation contributes to global warming.

Decreased truck safety: NAFTA allowed Mexican trucks access to the United States. Mexican trucks are not held to the same safety standards as American trucks. This provision was delayed and never fully implemented, though the U.S. did offer a pilot program for Mexican trucks to operate in the U.S. on a temporary basis.

Do NAFTA's Pros Outweigh Its Cons?

NAFTA's disadvantages are significant. Can anything justify the loss of entire industries in New York or Michigan? Worker mistreatment in the maquiladora program and severe environmental damage are also major drawbacks.

From a purely economic perspective, though, NAFTA could be considered a success. Without it, the impacts of competition from the growing economies of the European Union or China could be felt more acutely. That's critical now that both of these trade regions rank above the United States as the world's largest economies.

Evaluating NAFTA's value is not an easy or simple question. However, many experts believe that free trade agreements are a necessity for the United States. They help the U.S. compete in an ever more globalized world.

The United States-Mexico-Canada Agreement

The United States, Mexico, and Canada renegotiated NAFTA on September 30, 2018. The new deal is called the United States-Mexico-Canada Agreement (USMCA). It has been ratified by each country's legislature.

Mexico was the first to ratify the agreement in 2019. The U.S. Congress passed the agreement in mid-January 2020; Donald Trump officially signed it on Jan. 29, 2020. Canada ratified it on March 13, 2020.

The Trump administration renegotiated, intending to lower the trade deficit between the United States and Mexico. The new deal is largely similar to NAFTA. There are new rules, though, in seven areas:

Intellectual property

Digital trade

De minimis shipment value (the value of goods that can be traded without customs duties)

Financial services

Currency

Labor (including a requirement that at least 40% of auto content be made by workers earning at least $16 per hour)

Environment (addressing illegal trafficking of wildlife, timber, and fish)

Frequently Asked Questions (FAQs)

What was the purpose of NAFTA?

NAFTA was designed to decrease trade costs and increase business investment among the three North American nations. Its ultimate goal was to make North America more competitive on the world stage.

Which U.S. president signed NAFTA into law?

President George H.W. Bush originally approved NAFTA in December 1992. President Bill Clinton officially signed it into law on December 8, 1993.

The Balance uses only high-quality sources, including peer-reviewed studies, to support the facts within our articles. Read our editorial process to learn more about how we fact-check and keep our content accurate, reliable, and trustworthy.

1. Congressional Research Service. " The North American Free Trade Agreement (NAFTA)," Pages ii-iii.

2. The World Bank. " GDP (Current US$)."

3. Office of the United States Trade Representative. " United States-Mexico-Canada Agreement."

4. Congressional Research Service. " The North American Free Trade Agreement (NAFTA)," Page 11.

5. Congressional Research Service. " The North American Free Trade Agreement (NAFTA)," Page 16.

6. Chamber of Commerce. " Opening Markets, Creating Jobs: Estimated U.S. Employment Effects of Trade with FTA Partners," Pages 10-11.

7. Congressional Research Service. " The North American Free Trade Agreement (NAFTA)," Pages 20, 24.

8. Office of the United States Trade Representative. " NAFTA Facts."

9. Government Accountability Office. " International Trade: Foreign Sourcing in Government Procurement," Page 17.

10. Economic Policy Institute. " Heading South: U.S.-Mexico Trade and Job Displacement After NAFTA."

11. Economic Policy Institute. " NAFTA's Impact on the States."

12. Economic Policy Institute. " The High Price of 'Free' Trade."

13. Economic Policy Institute. " NAFTA's Cautionary Tale. Recent History Suggests CAFTA Could Lead to Further U.S. Job Displacement."

14. Temple University. " NAFTA and Immigration Intertwined: The Impact of the Trump Era on Mexican-U.S. Migration," Page 103-104.

15. Pew Research Center. " What We Know About Illegal Immigration From Mexico."

16. The University of Arizona Economic and Business Research Center. " IMMEX - Mexico's Export-Oriented Manufacturing and Services."

17. Sierra Club. " NAFTA's Impact on Mexico," Pages 1-2.

18. Federal Motor Carrier Safety Administration. " U.S.-Mexico Cross-Border Trucking Pilot Program."

19. Department of Transportation. " North American Free Trade Agreement - U.S. Department of Transportation Regulations."

20. International Monetary Fund. " GDP, Current Prices, Purchasing Power Parity."

21. Office of the United States Trade Representative. " Joint Statement from United States Trade Representative Robert Lighthizer and Canadian Foreign Affairs Minister Chrystia Freeland."

22. Office of the United States Trade Representative. " Ambassador Lighthizer Statement on Canada's Approval of the USMCA."

23. Office of the United States Trade Representative. " United States-Mexico-Canada Trade Fact Sheet: Modernizing NAFTA into a 21st Century Trade Agreement."

24. Congressional Research Service. " The North American Free Trade Agreement (NAFTA)," Summary.

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NAFTA was the world's largest trade agreement. It increased trade overall, but hurt American and Mexican workers.

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Website #1 (North American Free Trade Agreement - Success Stories) 

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Website #1 (North American Free Trade Agreement - Success Stories) 

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This website discusses about what is NAFTA and the success it has brought to the three countries involved. It talks about how it has allowed many companies to reach out and expand which they couldn't before. For example, Many car companies have started to build factories in Mexico for cheaper labor, allowing them to have more jobs and helping Canada by having cheaper cars and car parts. One interesting thing i have learned from this website is, that how companies that would been struggling to succeed got opportunities to grow and expand throughout the three countries.

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Video #3 (NAFTA: 6 ways America benefits from free trade) 

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Video #3 (NAFTA: 6 ways America benefits from free trade) 

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This video will discuss the benefits NAFTA has brought to the three countries. From watching the video, i have realized that NAFTA has helped bring stable jobs for many people along with quadrupling the trades between the three countries. Automobile companies have taken the advantage of cheap labor in mexico by opening factories. These factories helped having cars cheaper among the countries. One interesting thing i have learned about NAFTA from this video is that it helps the food has dropped in price due to have NAFTA. Mexico sends a lot of fruits and vegetables which are sold to Canada and it helps keeping the price of healthy food cheaper. for example, If we didn't have NAFTA then a lot of companies like McDonald's sell their products cheap to consumers and would eat there rather then buy expensive fruits and vegetables. this causes a lot of health problems such have diabetes and heart problems from eating fatty foods. NAFTA helps keep healthy foods cheap therefore allowing the food to be affordable for everyone.

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NAFTA: 6 ways America benefits from free trade

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Video #2 (What happens to Canada if NAFTA fails?) 

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Video #2 (What happens to Canada if NAFTA fails?) 

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This video is discussing how NAFTA effects Canada and what would happen to NAFTA if it were to fail. Canada would have companies which will lose business and will end up closing down. this will lead to people losing jobs and causing an big effect on the economy. The one piece of information i have learned from this video is, that all automobiles that would come from the U.S or mexico would cost much more. This is because, with the agreement the countries don't get charged taxes between trades and by NAFTA failing, it will lead Canadians to pay more for cars and parts. I believe this will cause Canada to make agreements with different countries, but to begin with it will cause a lot of harm.

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This video will be discussing what NAFTA is. The content is talking about what NAFTA has done for the three countries and how it can cause a lot of harm to employees if the deal if pulled out. Due to Donald Trump becoming president, his goal is to adjust NAFTA so that there are more jobs. but doesn't realize the effect it can have on the countries. One thing i have learned from this video is, the amount of jobs there were lost due to the agreement being made. This agreements goal was to bring more jobs through the three countries but had the opposite effect.

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Welcome everyone, i will be discussing the purpose of NAFTA and what this agreement has down for us.

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NAFTA (North American Free Trade Agreement)

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NAFTA (North American Free Trade Agreement)

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The importance of NAFTA by Salman Javid