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Nafta And The United Atlantic Free Trade Agreement

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Introduction
In 1990, Mexico approached the US with a trade agreement to improve the Mexican economy through a bilateral agreement that would benefit both parties (Villarreal 1-3). Negotiations birthed the North Atlantic Free Trade Agreement (NAFTA), in 1994, which included three countries - Mexico, America, and Canada. Since its inception, NAFTA has played an instrumental role in improving the economy of its member states (Thompson 121). Using this agreement, Mexico aimed to attract foreign investments and improve its economic performance in the same regard. For example, it strived to create new job opportunities and find new markets for its products (Thompson 121). These needs emanated from a period of economic slump that hit the Mexican economy in the 1980s and 1990s. These poor economic conditions had caused economic desperation in Mexico (Hufbauer 51-52). The main expectation of approaching the US for a bilateral trade agreement was to increase investor confidence in the country and improve its economic fortunes in the same regard (Villarreal 1-3). Other expected outcomes included improved export diversification, increased wage rates (for local workers), and increased sophistication of the local workforce (Thompson 121-122). Over time, Mexico hoped that the NAFTA agreement would also help it to reduce wage differentials with America. Consequently, NAFTA would affect the economy of the US-Mexico border in multiple ways. Besides the economic advantages of the agreement,
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