Peaceful, constructive business relationships between nations are always preferable to antagonistic relationships that may lead to wars. Trade-based international relationships save lives because the countries involved tend to avoid fighting over petty disagreements. In this spirit, the United States, Canada, and Mexico have come together in what is known at the North American Free Trade Agreement. This agreement, usually called NAFTA, seeks to encourage economic growth by giving individuals and businesses in the three member countries broad freedom to trade goods, products, and services across their borders. NAFTA went into effect on January 1, 1994.
Canada and the United States had already signed a trade agreement in 1988—called the Canada-United States Free Trade Agreement—but the United States wanted to negotiate a similar agreement with Mexico. Canada didn't want to be left out of the deal, so all three countries decided to adopt a treaty that would override the Canada-United States Free Trade Agreement. U.S. President George H. W. Bush, Mexican President Carlos Salinas, and Canadian Prime Minister Brian Mulroney met in San Antonio on October 7, 1992, to express their approval of the new treaty, and the three leaders signed it on December 17.
- NAFTA's Promise and Reality: An 88-page PDF dealing with NAFTA and the economy.
- Canada-United States Free Trade Agreement: A Canadian government page explaining the trade agreement between the U.S. and Canada, complete with a link to a 325-page PDF of the agreement.
- NAFTA: A brief history of NAFTA.
Two power shifts occurred while NAFTA was in the ratification process. Jean Chretien, the new prime minister of Canada, negotiated two supplemental agreements with the U.S. within NAFTA: the North American Agreement on Labor Cooperation and the North American Agreement on Environmental Cooperation. In the U.S., new President Bill Clinton guided the treaty through Congress and signed its final version.
NAFTA's main objective was to break trading constraints between the three countries: tariffs between the United States, Mexico, and Canada were officially eliminated by January 1, 2008. NAFTA has had an enormous impact on the economies of its member nations. Between 1992 and 2007, U.S. worldwide exports of agricultural products grew by 65 percent—but exports to its NAFTA partners grew by 156 percent. In fact, in 2007 Mexico was estimated to have imported over $11.5 billion of food and other agricultural goods from the U.S. This boost to U.S. agricultural trade extended to Canada as well: The U.S. went from exporting $4.2 billion of goods to Canada in 1990 to $11.9 billion in 2006. In all, agricultural trade between the three countries increased from $7.3 billion in 1994 to $20.1 billion in 2006.
- The NAALC: Information on the North American Agreement on Labor Cooperation and its history.
- North American Agreement on Labor Cooperation Preamble: A 26-page PDF about the articles of the NAALC.
- North American Agreement on Environmental Cooperation: An overview of the NAAEC that explains its key objectives and describes the Commission for Environmental Cooperation.
- North American Free Trade Agreement: A page that explains the treaty and how it has benefited the American economy, especially by opening the agricultural sector to more export opportunities.
- U.S. Free Trade Agreements: Information about free trade agreements that the U.S. has made with various nations, including a chart that shows the growth of total U.S. exports to free trade countries between 2007 and 2008.
- Commission for Environmental Cooperation: The CEC's official website, that explains the council and its mission.
The treaty has given rise to a few disputes and controversies in the years since it went into effect. Some politicians and critics claim that NAFTA has failed to live up to its standards, and has caused illegal immigration to the U.S. But others say the agreement has increased the unity between the three allied nations and has helped the agricultural sector. One of the main disagreements occurred between the U.S. and Canada. For years, the two countries argued over the United States' desire to implement a 27 percent duty on Canada's softwood imports. But this dispute was eventually resolved.
- NAFTA Victory May Lead to More Political Controversies: A 1993 news article speculating about how NAFTA's adoption would affect various political and international alliances.
- Deciphering the NAFTA: An article about the controversies surrounding NAFTA, and how the treaty will impact its member countries' economies.