`Should Ontario change or abrogate NAFTA`

Should Ontario Change or Abrogate NAFTA

Introduction

North American Free Trade Agreement (NAFTA ) was implemented with effect from January 1994 and was expected to remove most of the barriers of trade and investment among the United States , Canada and Mexico . NAFTA also had incorporated the agricultural provisions of the U .S - Canada Free Trade Agreement which was effective since 1989 thus eliminating all tariffs affecting agricultural trade between these two countries with effect from January 1998 , with exception to few items . Similarly there was a separate bilateral NAFTA agreement entered into

between Canada and Mexico eliminating most tariffs on the trading of agricultural products either with immediate effect or phased out over a period of 5 to 15 years (USDA ) By subscribing to NAFTA the three countries has formed the largest free trade area of the world . NAFTA was expected to establish a strong foundation for future economic growth of the North American region and was to provide an example of the immense benefits of trade liberalization . But it is the belief of the common people in Canada that NAFTA has been used against the interests of workers and communities and a majority of them want that the provisions of NAFTA should be renegotiated if not altogether scrapped . This presents a detailed analysis and a conclusive view on the issue of changing or abrogating NAFTA

Background of the Issue

As at the end of the year 2006 NAFTA extended to a free trade area covering an economy consisting of a value of more than 14 trillion and to a period the Agreement was hailed by some people and derided by some others . Proponents of NAFTA have attributed reasons for more integration citing the contribution of NAFTA to the trade and investment development of the region . However the critics are of the view that NAFTA had affected the jobs and wage levels because of growing competition and liberal immigration policies . They also fear that too much liberalization and extended co-operation might lead to loss of sovereignty . Because of its impact on jobs and wages trade unions are opposed to the continuance of NAFTA . Thirteen years after entering into the Agreement , the political debate even today remains more confused due to the fact that NAFTA could not achieve exclusively through the free trade deal most of what was promised at the time of entering into the agreement . Moreover whatever has been achieved could not be attributed solely to NAFTA . It is a simple fact that trade pacts can be depended only for the creation of opportunities but they cannot guarantee any results . Another development which needs consideration here is that the Canadian Dollar has found itself in a robust position at US 0 .95 in July 2007 as compared to US 0 .77 in 1993 followed by a downfall to US 0 .63 in 2002 . The Canadian wage levels provide a buying power of almost 50 percent more in US Dollar terms than it did in the year 2002 But still...