North American Free Trade Agreement Flashcards
(18 cards)
Who signed this agreement?
The USA, Canada and Mexico
When was the agreement signed?
In 1994
What was the main driver for this agreement?
The challenge presented by trade blocs from other parts of the world
Which trade blocs in particular were the main driver for this agreement?
Europe
When did Mexico get into debt?
In the 1970s and 80s
What did Mexico hope would result from joining NAFTA?
Economic growth and more employment would result
What are the 4 main aims of NAFTA?
Gradual elimination of all trade barriers
Promotion of economic competition between members
Increased investment opportunities
Generally improved co-operation between three member states
What have supporters of NAFTA pointed out in terms of trade?
Trade between member countries tripled between 1993 and 2007
What have supporters of NAFTA pointed out in terms of manufacturing?
It has grown in the USA with increased employment
How has Mexico benefited from NAFTA?
It has received more foreign investment and Mexican workers receive higher wages and increased sales from agriculture reduces migration
Why has Mexico received more foreign investment?
Foreign TNCs establish themselves here to gain access to the NAFTA trading partner markets
What has happened to some Canadian countries as a result?
They have closed because of competition from lower-cost US firms
What has happened to some American jobs?
Some US firms have moved to Mexico so some American jobs have been lost
What could happen to food surpluses?
Food surpluses in Canada and the USA may be dumped in Mexico, reducing food prices and affecting the agricultural economy there
Why could Mexico be exploited?
Because of its natural resources and less stringent pollution laws
What is another disadvantage to Mexico?
The growth of US-owned, labour intensive, export-orientated companies on the Mexican border keeps wage rates down
What is a maquiladora?
A manufacturing operation located in a free trade zone in Mexico
What do maquiladoras do?
Import materials for assembly and then export the final product without any trade barriers
