NAFTA

NAFTA
ARUNADEVI NADAR
ROLL NO.O2 M.COM PART-
1
(ACCOUNTANCY)
SUBJECT: ECONOMICS
TOPIC: NAFTA

NAFTA BACKGROUND
In 1994, the North American Free Trade Agreement (NAFTA), a state-of-the-art market-opening
agreement, came into force. Since then, NAFTA has sstematica!! e!iminated most tariff and non-
tariff "arriers to trade and in#estment "et$een %anada, the &nited States, and 'e(ico. )
esta"!ishing a strong and re!ia"!e frame$ork for in#estment, NAFTA has a!so he!ped create the
en#ironment of confidence and sta"i!it re*+ired for !ong-term in#estment. NAFTA $as preceded
" the %anada-&.S. Free Trade Agreement.
NAFTA is a tri!atera! free trade dea! that came into force in ,an+ar 1994, signed " -emocratic
.resident )i!! %!inton. The centra! thr+st of the agreement is to e!iminate the #ast ma/orit of tariffs
on prod+cts traded among the &nited States, 'e(ico, and %anada. The terms of the agreement
ca!!ed for these tariffs to "e phased o+t grad+a!!, and the fina! aspects of the dea! $eren0t f+!!
imp!emented +nti! ,an+ar 1, 1223. The dea! s$ept a$a e(port tariffs in se#era! ind+stries4
agric+!t+re has "een a ma/or foc+s, "+t tariffs ha#e a!so "een red+ced on items !ike te(ti!es and
a+tomo"i!es. NAFTA a!so imp!emented inte!!ect+a!-propert protections, esta"!ished disp+te-
reso!+tion mechanisms, and p+t into p!ace regiona! !a"or and en#ironmenta! safeg+ards, tho+gh
some critics no$ !o"" for stronger meas+res on this front.
NAFTA ~ CHRONOLOGY OF EVENTS
• ,+ne 12, 19924 %anada, the &.S., and 'e(ico agree to p+rs+e a free trade agreement
• Fe"r+ar 5, 19914 NAFTA negotiations "egin.
• -ecem"er 16, 19914 NAFTA is signed " !eaders from %anada, the &.S., and 'e(ico.
• A+g+st 19974 Additiona! side agreements on !a"or and the en#ironment are negotiated.
• January 1, 1994: NAFTA n!r" #n!$ %$r&
1 | P a g e
GOALS OF NAFTA
• to red+ce "arriers to trade
• to increase cooperation for impro#ing $orking conditions in North America
• to create an e(panded and safe market for goods and ser#ices prod+ced in North
America
• to esta"!ish c!ear and m+t+a!! ad#antageo+s trade r+!es
• to he!p de#e!op and e(pand $or!d trade and pro#ide a cata!st to "roader
internationa! cooperation
SU''LE(ENTS OF NAFTA
N$r!) A*r#&an A+r*n! $n La,$ur C$$-ra!#$n
The North American Agreement on 8a"o+r %ooperation (NAA8%) came into effect in ,an+ar
1994. It is one of t$o para!!e! accords to the North American Free Trade Agreement "et$een the
&nited States, %anada, and 'e(ico. The Agreement is administered " the %ommission for
8a"o+r %ooperation, $hich consists of a %o+nci! of 'inisters and a tri-nationa! Secretariat,
"ased in 9ashington -.%. %+rrent! fo+r pro#inces (:+e"ec, A!"erta, 'anito"a and .rince
;d$ards Is!and) are signatories to the NAA8% thro+gh an Intergo#ernmenta! Agreement.
The %ommission $orks in c!ose cooperation $ith the Nationa! Administrati#e o"ert -onne!!, that has not happened.
As $e enter the 11st cent+r, organi@ed !a"or in the &nited States contin+es to oppose NAFTAG
!a"or representati#es #ie$ the 8a"or Side Agreement as an ineffecti#e mechanism that is
+nenforcea"!e. The most significant achie#ement of the 8a"or Side Agreement to date is simi!ar to
that of the ;n#ironmenta! Side Agreement4 comp!aints "efore the 8a"or %ommission and the NA
 

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