An integral part of the Trade North America Conference are sessions about the North American Free Trade Agreement (NAFTA). It is essential to be educated about NAFTA in order to be able to expand your business in North America.
The agreement was signed into a law in the end of 1993 and entered force January 1994. It eliminates barriers and makes the cross-border movement of goods and services easier and more efficient. It has also increased investment opportunities. As the largest free trade area in the world, NAFTA links 444 million people and produces over $15 trillion in goods and services every year. Furthermore, it has helped Mexico, Canada, and the United States to become more involved in the world's trade market, thus making them more open economies. Canada and Mexico alone account for 50% of the increase in U.S. agricultural exports to the world since 1993. This is due to the fact that since the agreement was signed, trade between the three countries has tripled.
NAFTA continues to have positive effects on trade and business in the countries that are a part of it. For example, it is estimated that U.S. GDP increases by close to .5% a year because of NAFTA. Also, NAFTA has been a positive factor for Mexican agriculture as trade growth has been balanced the past decade. Furthermore, due to NAFTA Mexican tariffs had been reduced greatly in the past. Now, as of January 1, 2008, all tariffs between the three countries have been eliminated. This is an important fact because Mexico is the top destination for beef, rice, soybean meal, corn sweeteners, apples, and beans.
In conclusion, economic growth for the three countries has been as strong ever since the agreement has been in place. NAFTA is an important factor to consider when doing business in North America. If you wish to learn more about NAFTA, please check out our informative course module on the subject. Learn more about the historical origins, facts, members' roles, and future developments toward regional integration.