Paper Topic:

The argument against the North American Free Trade Agreement

DISADVANTAGES OF NAFTA

DISADVANTAGES OF NAFTA

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Institutional Affiliation Goes Here Abstract

NAFTA is a free trade agreement between U .S .A , Canada and Mexico . Its main aim is to develop free market within these countries . This research essay critically analyzes how NAFTA has ruined the economy of its member countries in detail

INTRODUCTION

North Atlantic Free Trade Agreement [NAFTA] is a trade agreement between United States , Mexico , and Canada to facilitate free flow of goods labour and services among these countries without necessity to pay

taxes on such manufactured goods in these countries . NAFTA was ratified in November , 1993 and came into effect from January 1 1994 .[Weintraub ,1994 ,10] .Thus , NAFTA has fostered world 's largest market with approximately 430 million consumers and a guesstimate of output of 13 .5 trillion

WHY NAFTA IS NOT A PREFERED FREE TRADE AGREEMENT

NAFTA has been criticized on many grounds . It has been alleged that NAFTA has resulted in the decline of wages rates in the member countries of NAFTA . NAFTA is very lenient thereby encouraging big business enterprises to infringe the environmental protection laws easily thereby making the consumer 's and public health at risk

It has been alleged that U .S .A is the great looser as far as NAFTA is concerned as it is evidenced from the fact that U .S . trade deficit with the Canada , Mexico had increased to 95 billion from that of 9 billion For instance , the U .S trade deficit with Mexico and Canada was 34 billion in the year 1998 . Further , according to Economic Policy Institute , the job losses in U .S .A were estimated to 910 ,000 in 2005

Further , whatever the advantages that NAFTA seems to afford to Mexico it would be counterbalanced by the concerns brought on by the dislocation of millions of agriculturists and their dependents due to a radical reduction in the production of Mexico 's major agricultural product namely corn . Under NAFTA , Mexican farmers could not compete with the US farmers due to geographical disadvantages and climate conditions NAFTA is supposed to usher benefits to all participating nations However , how one can justify the peril of probable economic disaster for a country by eliminating or reducing the production of its chief agricultural product namely corn . Without causing an economic domino effect , a country cannot eradicate the livelihood of the millions of its people . Thus , NAFTA may not be advantageous to the overall economy of Mexico as stated by the proponents of the agreement

After NAFTA , U .S manufacturing companies which seeks a cheap labor in the Mexican market has built number of factories at the proximity of Mexican bs which is famously known as maquiladoras ' thereby offering employment to tens of thousands of Mexicans . The real burnt is felt by American textile workers who has already suffered due to outsourcing to Asia , witnessed an export of almost 80 ,000 jobs to neighboring Mexico mainly due to NAFTA . [Jane Tanner , 2002 , 14] . Mack McLarty , former...

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