NAFTA
Three countries, one market, and very different ledgers
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A free trade agreement removes tariffs and quotas between countries, so that goods cross the border as if it were not there. The agreement was the largest free trade area created at the time, and it has become a fixed reference in the argument about globalisation — invoked by both sides with equal conviction. Its effect on Mexican agriculture is the least disputed part: subsidised American maize undercut local production in maize's own homeland, and migration northward rose. It was replaced by the USMCA in 2020.
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Canada, the United States and Mexico removed most tariffs between them. Trade multiplied and factories moved to Mexico. But many industrial jobs in the United States and Canada disappeared, and Mexican smallholders could not compete with American maize.
Sources
- North American Free Trade Agreement (1994)
- Hufbauer & Schott, NAFTA Revisited (2005)
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