ANASWARA M B 2016-45-004

ZITTA RAPHEL 2016-45-006

ANAGHA M P 2016-45-021
 INTRODUCTION
• The North American Free Trade Agreement (NAFTA) is a comprehensive trade
agreement that sets the rules of trade and investment between Canada, the
United States, and Mexico

• NAFTA has systematically eliminated most tariff and non- tariff barriers to free
trade and investment between the three NAFTA countries.

• In 1992, NAFTA was signed by outgoing President George H.W. Bush, Mexican
President Salinas, and Canadian Prime Minister Brian Mulroney
• NAFTA was ratified by the legislatures of the three countries in 1993.
• President Bill Clinton signed it into law on December 8, 1993. It entered into force on
January 1, 1994.

• Members: Canada, Mexico & United States

• Official languages: English, French and Spanish

• Secretariats: Mexico city, Ottawa, Washington D.C.

• NAFTA supplements: NAAEC & NAALC

 HOW DOES NAFTA WORKS?
• NAFTA is a formal agreement that establishes clear rules for commercial activity between
Canada, the United States, and Mexico.

• It is overseen by a number of institutions that ensure the proper interpretation and

smooth implementation of the Agreement’s provisions.
Free Trade Commission
 NAFTA Coordinators
 NAFTA working groups & committees
 NAFTA Secretariat
 Commission for labor Cooperation
 Commission for Environmental Cooperation
 OBJECTIVES
• To eliminate trade barriers & facilitate the cross-border movements of goods and

services between the parties

• To promote conditions of fair competition

• To substantially increase investment opportunities

• To provide adequate and effective protection & enforcement of intellectual
property rights in each territory

• To create effective procedures for the implementation and application of this

agreement ,for its joint administration & for resolution of disputes

• To establish a framework for further trilateral, regional and multilateral co-

operation to expand and enhance benefits of this agreement
 NAFTA SUPPLEMENTS

1. The North American Agreement on Environmental Cooperation (NAAEC)

2. The North American Agreement on Labor Cooperation (NAALC)

 The North American Agreement on
Environmental
Cooperation (NAAEC) 
• The North American Agreement on Environmental
Cooperation (NAAEC) is an environmental agreement
between the United States of America, Canada and Mexico as a side-
treaty of the North American Free Trade Agreement.

• The agreement came into effect January 1, 1994.

• The agreement consists of a declaration of principles and objectives concerning

conservation and the protection of

the environment as well as concrete measures to further

cooperation on these matters between the three countries.

 The  North  American  Agreement 
on  Labor  Cooperation  (NAALC)
• The North American Agreement on Labor Cooperation (NAALC) was signed on

September 14, 1993, by the Presidents of Mexico and the United States, and the Prime
Minister of Canada, as one of the supplementary accords
to the North America Free Trade Agreement (NAFTA).

• It entered into force on January 1, 1994.

• The NAALC was the first international agreement on labor to be linked to an
international trade agreement.

• It provides a mechanism for member countries to ensure the effective enforcement of

existing and future domestic labor standards and laws without interfering in the
sovereign functioning of the different national labour
systems, an approach that made it novel and unique.
 PROVISIONS
NAFTA also seeks to eliminate non-tariff trade barriers and to protect the intellectual
property right of the products .

Intellectual Property:

• NAFTA made some changes to the Copyright law of the United States
foreshadowing the Uruguay Round Agreements Act of 1994 by restoring

copyright (within NAFTA) on certain motion pictures which had entered the public domain
• Environment:
• A side agreement was negotiated on the environment with
Canada and Mexico, the North American Agreement on Environmental Cooperation

(NAAEC), which led to the creation of the Commission for Environmental

Cooperation(CEC) in 1994.
• Transportation infrastructure: NAFTA established the CANAMEX Corridor for road transport
between Canada and Mexico,

also proposed for use by rail, pipeline, and fiber optic telecommunications infrastructure.

• This became a High Priority Corridor under the U.S. Intermodal Surface Transportation

Efficiency Act of 1991.

• Agriculture: Three separate agreements were signed between each pair of parties.

• The Canada –US Agreement contains significant restrictions and tariff quotas on
agricultural products (mainly sugar , dairy and poultry products)

• The Mexico –US pact allows for a wider liberalization within a framework of phase out
periods (it was the first north - south FTA on agriculture to be signed )
 BENEFITS
• Benefits the importers by reduced or duty free goods.

• Trade and investment levels in North America have increased, bringing strong economic
growth, job creation, and better prices and selection in Consumer goods.

• There has been great increase in trade among the three countries and market access within
each country also increased considerably.

• Improved economic stability in the U.S. marketplace

• A marketplace that is increasingly driven more by supply and demand than by barriers to
commerce
 Limitations:
• It has negative impacts on farmers in Mexico who saw food prices fall based on cheap
imports from U.S. agro business

• It has negative impacts on U.S. workers in manufacturing and assembly industries who lost
jobs.

• Critics also argue that NAFTA has contributed to the rising levels of inequality in both the
U.S. and Mexico.

• Some economists believe that NAFTA has not been enough (or worked fast enough) to
produce an economic convergence, nor to substantially reduce poverty rates
 United States-Mexico-Canada
Agreement
• Under the leadership of President Donald J. Trump, the United States has reached an
agreement with Mexico and Canada in the renegotiation of the North American Free
Trade Agreement (NAFTA). The new United States-Mexico-Canada Agreement (USMCA) is
a mutually beneficial win for North American workers, farmers, ranchers, and businesses.
When finalized and implemented, the agreement will create more balanced, reciprocal
trade that supports high-paying jobs for Americans and grows the North American
economy.
 CONCLUSION
• The North American Free Trade Agreement (NAFTA) revolutionized trade and investment in
North America, helping to unlock our region’s economic potential.

• It has helped to stimulate economic growth and create higher-paying jobs across North
America.

• It has provided North American businesses with better access to materials, technologies,
investment capital, and talent available across North America.

• It has proven that trade liberalization plays an important role in promoting transparency,

economic growth, and legal certainty.

REFERENCE
• www.naftanow.org