NAFTA: Canada\'s & Mexico\'s Viewpoints

When the Canada/U.S. free trade agreement came into effect, the
Mexican\'s were very impressed by the provision and opportunities that opened for
both sides. Mexico then approached the U.S., seeking to form a similar
agreement with them. This brought forth a new issue in Canada, should they let
Mexico and the U.S. form an agreement without them? Or should they participate,
thus transforming their deal with the U.S. into a trilateral agreement including
Mexico.

On June 12, 1991, the trade ministers of Canada, the United States and
Mexico met in Toronto to open negotiations for a North American Free Trade
Agreement (NAFTA). This was an historic occasion. For the first time ever, a
developing country agreed to sit down with two industrial countries to craft an
agreement that would open its economy to full competition with the other two
countries. If successful, the agreement promised to make the whole North
American continent into one economic zone and set an important precedent for
trade and economic cooperation between the wealthy countries of the North and
less developed countries of the South. The challenge before them was both
exciting and daunting.

A little more than a year later, the three trade ministers met again in
Washington, to put the finishing touches on a new North American Free Trade
Agreement. In just over a year the negotiators from the three countries had
successfully met the challenge and put together a new trading frame work for
North America. The North American Free Trade Agreement (NAFTA) was set to be
implied.

The North American Free Trade Agreement often raises questions regarding
the new economic trading blocs around the world. The twelve-nation European
Community (EC), a Central American free trade zone, and a four-nation South
American group, as well as preliminary discussions regarding an Asian trading
bloc, all point to the fact that new economic realities already exist. NAFTA
promises to have a major impact on the people in all three nations. There will
obviously be short-term costs of adjustment, which will certainly hit some
industries, regions, and workers harder than others. There will be definite
winners in the agreement, and definite losers in the agreement. There even
might be disputes. Whether as workers, investors, consumers, or ordinary
citizens in all three countries they may be affected. The final verdict on the
North American Free Trade Agreement, may in fact not fully be realized for many
weeks, months, or even years. However, in the following essay, the advantages
to both Mexico and Canada will be analyzed, as well as the disadvantages to
Mexico. It is safe to say that the advantages clearly outweigh the
disadvantages, and that it will in fact be beneficial for both countries to be
involved in this unique deal.

*** Benefits to Canada

Canada\'s goals in the negotiation of NAFTA were very simple. They wanted to
improve their access for their goods and services to Mexico and the United
States. Canada wanted to guarantee their position as a prime location for
investors seeking to serve all of North America. The NAFTA deal has realized
these objectives set by Canada and will supply Canada with a new and sharper
edge to their international competitiveness. The agreement has set a path for
Canada widening their trade horizons, while also giving them a bigger stage on
which to demonstrate their economic expertise and leadership.

An advantage for Canada is that the reduction of Mexican barriers will provide
new markets and opportunities for Canadian goods and services. Canadian firms
will be able to participate in, and expand sales in, sectors that were
previously highly restricted, such as autos, financial services, trucking,
energy and fisheries. Mexican tariffs and import licensing requirements will be
eliminated, some immediately and others over 5 to 10 years, providing barrier
free access to 85 million consumers.

The North American Free Trade Agreement covers virtually every field of business
in Canada. NAFTA provides many provisions as well as both real and potential
advantages to Canadians in all most all places in the work place.

Agriculture products play a significant role in Canada\'s exports to other
countries. Canada\'s excellent and fertile farming land has produced many great
results. A very superior livestock and excellent crops have contributed to a
productive and prosperous trade of their agricultural products and services
around the world. Canada\'s total exports surpasses $13 billion a year. Under
NAFTA Canada and Mexico have worked out a separate agreement between themselves.
Over all Canadian exports will enjoy immediate access to the Mexican market
under the deal. Mexican import licenses on wheat, barley and table potatoes
will be eliminated over a period of time. Also tariffs on lentils,