Free Trade Agreements And Its Effects On Latin American Nations

In 1994, the North American Free Trade Agreement (NAFTA) was enacted between two industrial countries and a yet still developing nation. This was an agreement that was the first of its kind due to the relationship that the countries had and the investment opportunities that it presented. The United States, Canada, and developing Mexico decided to work towards eliminating most tariffs and non-tariff barriers between the three in order to increase the flow of trade in goods and services. Since its enactment NAFTA has led to the providing of over 40 million more jobs throughout the countries, and it has also tripled merchandise trade between the three participants to an astounding $946 billion USD in 2008 (NAFTA Now). However even then it is still not very clear whether enacting NAFTA was worth the time and effort and in fact the United States may have been better off not having joined NAFTA.

After a lengthy negotiation of over 3 years, Canada, the United States, and Mexico reached an agreement on trilateral trade ― the North American Free Trade Agreement. Commonly referred to as NAFTA, it came into effect on the first day of 1994. Covering 450 million of population and reaching $17 trillion in combined GDP, NAFTA proudly ranks the first among the world’s free trade agreements (USTR). It is usually seen as a remarkable success for the countless benefits it brings to its members. Some of NAFTA’s main advantages are promoting closer relationships, eliminating trade barriers, and increasing market opportunities. However, as the first proposer of NAFTA, the United States has indeed benefited the most from it in several different

The North American Free Trade Agreement, commonly known as the NAFTA, is a trade agreement between the United States, Canada and Mexico launched to enable North America to become more competitive in the global marketplace (Amadeo, 2011). The NAFTA is regarded as “one of the most successful trade agreements in history” for its impact on increases in agricultural trade and investment among the three contracting nations (North American Free Trade Agreement, 2011). Supporters and opponents of the NAFTA have argued the effects of the agreement on participating nations since its inception; yet, close examination proves that NAFTA has had a relatively positive impact on the economies of the United States, Canada, and Mexico.

“By 1988 three-quarters of Canadian trade was already with the United States” (White 1994). By the time negotiations concerning NAFTA commenced in 1990, proponents of the aforementioned Free Trade Agreement (FTA) were witnessing some of the many beneficial effects that compelled them to lobby for such an agreement. The bilateral trade deal between Canada and United States, was the engine starter for much of the shared substantial economic growth that occurred between 1989 until 2002. Throughout this period of growth “Canadian exports to the United States rose by 221%” (Lessons From NAFTA). The sub sequential growth that was initially sparked by the FTA paved the way for NAFTA sympathizers and proponents as means to promote this unprecedented trilateral trade agreement.

The North American Free Trade Agreement, or N.A.F.T.A, was established to improve the economy of the United States, Mexico, and Canada. It has been close to twenty-three years since the treaty was officially signed; time has given us insight into the effects that this agreement has produced.

The North American Free Trade Agreement (NAFTA) was enacted in November of 1993 with aims to facilitate the free flow of goods, services and labor between the United States, Canada and Mexico. The ratification of NAFTA created the world’s largest free market with roughly 390 million consumers and an estimated total output of $8.6 trillion. Clearly, this trade alliance has had a major influence on the financial service industries of the participating nations and will continue to do so in the future. However, the financial service provisions of NAFTA will have sufficiently greater implications for Mexico than either the United States or Canada. This is in part because Mexico is embarking upon a greater shift towards openness in its

Throughout the decades, motivations to join a Regional Trade Agreement (RTA) have remained fairly consistent. Along with the prospects of economic growth and development, countries aim to achieve economic and social stability, poverty reduction, and an increase in labor provisions. As with many developing countries, RTAs encounter a wide range of complications that hinder economic prosperity. In some cases, RTAs that are formed with good intentions by countries who seek growth come to have a negative effect on a country within the agreement. The following essay will provide an in-depth analysis on the impact the Dominican Republic-Central America Free Trade Agreement (CAFTA-DR) continues to have on Guatemala’s preexisting social issue of

Hilary Clinton’s main key quote on trade is “Any trade deal has to produce jobs and raise wages and increase prosperity and protect our security.” In this quote she is talking about trade deals like Trans-Pacific Partnership (TPP), North American Free Trade Agreement (NAFTA) and Central America Free Trade Agreement (CAFTA). Hillary Clinton and Donald Trump do not support the TPP or the CAFTA trade agreement. But Hilary Clinton wants the renegotiate NAFTA while Donald Trump says that we need to either renegotiate or get rid of the trade agreement.

Negotiations started in early 2004 on the Central America Free Trade Agreement, later on in the negotiation process the Dominican Republic joined to make CAFTA-DR. The original countries that made up CAFTA were Costa Rica, El Salvador, Guatemala, Honduras, and Nicaragua with the Dominican Republic joining forces later on. CAFTA was coupled together with NAFTA and the Canada-Costa Rica Trade Agreement separating them from the Free Trade of the Americas Agreement otherwise known as, FTAA. (WIKI)

When the Central American Free Trade Agreement CAFTA was passed, it created a free trade zone between the United States and six less developed Central American countries. The creation of a free trade zone would increase the standards of living for all countries involved by driving down production costs. By opening the markets, CAFTA aimed to create more economic opportunities to produce in areas where a country has a comparative advantage and import where it does not. The type of laborers differ in the US and these countries, allowing for specialization, reduced costs, and increases in consumption and demand for labor. As a result, countries from around the world are showing new interests in these six Central American countries.

The Chilean economy is very internationalized. The country draws a high inward foreign direct investment due to its sustained economic growth and stability and due to favorable investment and business development climates. Chile is committed to trade and investment liberalization. Chile is the first country in South America to sign a free trade agreement with the USA (effective January 1, 2004). (Mogab, Spring 2011) Since then there has been increasing economic interdependence between the U.S. and Chile. American exports to Chile have increased by 545% to over $17.5 billion in 2013. Chilean exports to the United States have increased 180% under the Free Trade Agreement to $10.3 billion in 2011. (Benefits of U.S. Free Trade Agreements)

Being the world 's largest economy, the United States is also largest exporter and importer of goods and services. American economic growth relies heavily on trade. According to a recent report on NAFTA, “Since 1992, nearly 20 million new jobs have been created in the U.S., in part due to the 1994 NAFTA agreement. Total trade between the NAFTA partners -- the U.S., Canada, and Mexico -- rose from $293 billion in 1993 to more than $475 billion in 1997, and has increased since. ” (Bowman, Free Trade). It is obvious evidence that international trade is beneficial to the US economy, at least in the 1990s.

In 1994, the leaders of the thirty-four democratic countries of the Western Hemisphere launched the process of creating a Free Trade Area of the Americas (FTAA). The FTAA will be established by 2010 with the aim of gradually eradicating barriers to trade and investment in the region. The final characteristics of the FTAA will be determined through negotiations by government officials from the thirty-four participating countries. The trade issues that are presently under discussion are: market access; investment; services; government procurement; dispute settlement; agriculture; intellectual property; antidumping, subsidies and countervailing duties; and competition policy. Guiding principles for these negotiations

Mexico is the top trading nation in Latin America and the ninth-largest economy in the world. No country has signed more free trade agreements – 33 in all, including the two biggest markets in the world, the US and the EU. Altogether these signatory countries make up a preferential market of over more than billion consumers. Much of the FDI in Mexico is attracted by the country’s strategic location within the North American Free Trade Agreement, which has positioned it as a springboard to the US and Canada. Other attractions are competitive production costs and a young, skilled workforce, together with political stability and an open economy.

This paper will aim to examine the effect of the engagement in preferential trade arrangement on the trade of Paraguay. Preferential trade agreements (PTAs) have become a prevalent tool for regional economic collaboration. Despite its recognition and popularity, however, many economists are still skeptical of the effectiveness of PTAs. Preferential trade agreements (PTAs) are critical parts of the world’s current multidimensional trading system. The agreements allow nations to engage in regional or exclusive free trade cooperation. When countries are engaged in a PTA, they jointly allow preferential access on goods and services under the agreement to each other. PTAs introduce a new aspect of international trade for World