Many economists and other observers have attributed NAFTA to the fact that it has helped U.S. manufacturing, particularly the U.S. auto industry, to become more globally competitive through greater economic integration in North America and the development of supply chains.54 Much of the increase in U.S.-Mexico trade can be attributed, for example, to the development of U.S.-Mexico trade. , to specialization, as production and assembly plants have shifted to exploit economies of scale. As a result, supply chains are increasingly moving beyond national borders, as manufacturing work is done wherever it is most efficient.55 Reducing tariffs in a given sector has an impact not only on prices in that sector, but also on the input sectors of that sector. According to one study, the importance of these direct and indirect effects is often overlooked. The study suggests that these links offer significant trade and welfare gains under free trade agreements and that ignorance of these in-exit connections may underestimate potential trade gains56. While technological progress has profoundly changed the way businesses trade and operate across international borders, some companies say that new barriers have also been created that do not address existing trade rules. NAFTA parties may consider discussing issues related to the cross-border transmission of information electronically or the forced location of data centres. Such provisions could provide North American companies with greater flexibility in processing and storing data relevant to their operations. Some of these issues have been addressed in the TPP.
Supporters have capped NAFTA because it has opened up Mexican markets to U.S. companies like never before. The Mexican market is growing rapidly, which promises more export opportunities, which means more jobs. However, proponents have struggled to convince the American public that NAFTA would do more good than harm. Their main efforts have been to convince citizens that all consumers have as wide a choice of products at as low a price as possible, which means that consumers would be the main beneficiaries of lowered trade barriers. The U.S. Chamber of Commerce, which represents the interests of small businesses, was one of THE most active supporters of NAFTA and organized small and medium-sized business owners and employees to support the agreement. This support was essential to counter the efforts of organized work to put an end to the agreement.
But the most important aspect for Canada – opening up its economy to the United States, by far Canada`s largest trading partner – was before NAFTA, when the Canadian United States came into force in 1989. Free Trade Agreement (CUSFTA). Total Canada-U.S. Trade rose rapidly in the wake of trade liberalization in Canada. After NAFTA, Canadian exports to the United States increased from [PDF] $110 billion to $346 billion; Imports from the United States increased almost as sharply. The discussion on a common trade area was initiated in 1985 by Canadian Prime Minister Brian Mulroney with the proposal to draft a free trade agreement between Canada and the United States. Negotiations began in 1986 and the two countries signed the agreement in 1988. The Canada-U.S. agreement came into force on January 1, 1989. Unemployment has also increased, which some NAFTA economists have criticized for exposing Mexican farmers, especially maize producers, to heavily subsidized competition from the United States.