NAFTA (North American Free Trade Agreement) - PowerPoint PPT Presentation

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NAFTA (North American Free Trade Agreement)

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  1. NAFTA (North American Free Trade Agreement) Tratado de Libre Comercio de América del Norte By Tanvi Parmar Accord de Libre-échange Nord-Américain

  2. What IS NAFTA? • Definition: • A trade agreement made between the governments of • Mexico, Canada and the United States for the purpose of • eliminating trade barriers among them. • Important Documents: • -North American Free Trade Agreement (with preamble, • 22 chapters, 7 annexes, and articles) • -procedural forms

  3. AGE OF ORGANIZATION • -Negotiations between three countries since 1986 • -President H.W. Bush, Prime Minister Brian Mulroney and President Carlos Salinas met together on December 17, 1992 in San Antonio, Texas in order to sign agreement. • -The agreement was then given to each country’s legislative in order to • make changes and approve (protect American workers/U.S. partners must • follow same environment practices and regulations like theirs). • -By the time all the changes were made, Bill Clinton became president of • U.S. and two Canadian prime ministers came into office (Campbell/ • Chretien) • -NAFTA was implemented on January 1, 1994 (18 years old)

  4. Purpose • Outlined by Article 102 of the agreement: • -eliminate trade barriers and tariffs between three countries • -promote conditions of fair competition • -increase investment opportunities • -provides protection and enforcement of property rights • -provides procedure to resolve trade disputes • -establishes framework for further improvement agreement and expand NAFTA’s benefits

  5. Who IS INVOLVED? • Membership: • -U.S., Canada and Mexico • Leadership: • -The presidents and prime ministers of these three countries meet • at a North American Leaders Summit and discuss there (summit- • meeting of heads of government/ state with an agenda of • discussion) • -Each has a Secretariat comprised of a Mexican Section (Mexico • City,), U.S. Section (Washington D.C.) and Canadian Section (Ottawa) • that is responsible for any disputes regarding NAFTA

  6. Advantages of Membership • -allows 450 million people to trade with each other at a lower cost • -reduces inflation (by decreasing cost of imports) • -creates agreements on international rights for business investors • -reduces cost of trade (greatly benefit and help growth in small businesses) • -increased trade in all goods and services (responsible for $1.6 trillion in • goods and services every year) • -increases GDP • -foreign direct investment (when an individual or company owns more than • 10% or more of a foreign business) • -reduced oil and grocery prices

  7. Disadvantages of membership • -loss of jobs ( U.S. manufacturers sent jobs to Mexico for • cheaper; jobs are lost) • -farmers put out of business (due to subsidized farm • products) • -wages are suppressed (threaten to send jobs away) • -maquiladora workers are exploited • -environment destroyed (pressure to compete use • chemicals)

  8. International impact-Mexico • -U.S. Jobs are now getting sent to Mexico (cheap labor; exploitation) • -Local Mexican farmers cannot compete with U.S. subsidized farm • products (lost farms) • -Mexican environment destroyed (due to competitive pressure); • pollution • -trade increase in products and goods (higher growth) • -Mexican oil is imported for less • -GDP growth (46%) • -more foreign investment

  9. INTERNATIONAL IMPACT- canada • -Canada’s trade with U.S. has grown 80% • -U.S.-Canada and Mexico-Canada trade for $484 billion • -growth in exports (successful in automotive equipment, machinery • and parts and industrial goods) • -growth in imports • -contributed to Canada’s attractiveness to foreign investors

  10. What does nafta mean for u.s.? • -increase in GDP (.5% a year) • -boosted U.S. farm exports (eliminated high Mexican tariffs) • -created trade surplus in service (financial services and healthcare) • -reduced oil and gas prices • -increase in foreign direct investment • -U.S. jobs lost/ U.S. wages suppressed • -can compete with European Union • -can compete with China and its’ trade agreements

  11. Work Cited • Information: • -The NAFTA's Impact." Foreign Affairs and International Trade Canada. n. page. • Web. <http://www.international.gc.ca/trade-agreements-accords- • commerciaux/agr-acc/nafta-alena/nafta5_section04 • .aspx?lang=en&view=d>. • -NAFTA Secretariat. n. page. Web. <http://www.nafta-sec- alena.org/en/view.aspx?x=202>. • -Amadeo, Kimberly. "History of NAFTA." About.com. n. page. Web. 24 Mar. 2012. <http://useconomy.about.com/od/tradepolicy/p/NAFTA_History.htm>. • -Amadeo, Kimberly. "Disadvantages of NAFTA." About.com. n. page. Web. 24 Mar. 2012. <http://useconomy.about.com/od/tradepolicy/p/NAFTA_History.htm>. • -Amadeo, Kimberly. "Advantages of NAFTA." About.com. n. page. Web. 24 Mar. 2012. <http://useconomy.about.com/od/tradepolicy/p/NAFTA_History.htm>.

  12. Work Cited: • Pictures: • -http://www.fas.usda.gov/itp/policy/nafta/NAFTA_logosmall.jpg • -http://www.ustr.gov/sites/default/files/nafta.jpg • -http://www.augustforecast.com/wp-content/uploads/NAFTA_signing.jpg • -http://www.yesmagazine.org/new-economy/images/nafta-signing-ceremony • federal-photo/image_preview • -http://graphics8.nytimes.com/images/2009/03/24/business/24peso.650.jpg • -http://wikis.lib.ncsu.edu/images/0/05/NAFTA.jpg • -http://www.wnd.com/images/nafta2.jpg • -http://www.infoplease.com/images/mexico.gif • -https://www.cia.gov/library/publications/the-world-factbook/graphics/flags/large/ca • lgflag.gif • -https://www.cia.gov/library/publications/the-world-factbook/graphics/flags/large/us-lgflag.gif