LBC talked with top officials from the three NAFTA countries on what the trade agreement has achieved in 20 years, and what could be done to make it stronger.
NAFTA – the North American Free Trade Area – marks 20 years in effect this year. The trilateral agreement between Canada, Mexico, and the United States has dramatically transformed trade between the three countries: creating a more integrated North America, rising trade volumes, and setting the groundwork for various initiatives. In 2013, Canada was the United States’ largest trading partner by value, while Mexico was the third largest, though it was the second largest recipient of U.S. exports. The United States was also the largest trading partner of both Canada and Mexico – receiving 75 percent of Canadian exports, and 78 percent of Mexican exports.
While trade and integration between Canada and the United States was already well-established before NAFTA – partly a result of the 1989 Canada-United States Free Trade Agreement – trade between Mexico and the United States has been truly revolutionized by NAFTA. Since the agreement was signed, U.S. trade with Mexico has grown an incredible 506 percent, compared with 289 percent with other countries. According to statistics from Latin Business Chronicle, bilateral U.S.-Mexican trade was worth $509 billion last year – an amount that comes out to almost $1 million per minute. Integrated value chains mean that goods now move across the border various times before creating a finished product.
LBC spoke with representatives from the three NAFTA countries about the 20th anniversary of NAFTA, and what they think could be done to move the relationship forward: U.S. Chamber of Commerce Executive Director, Americas Strategic Policy Initiatives Patrick Kilbride, former Mexican ambassador to the United States, and current Chairman of Global Solutions Arturo Sarukhan, and Canadian Consul General in Miami Louise Léger. All three agreed on the necessity of moving the NAFTA framework into the 21st Century, their excitement for the prospect of North American energy independence and integration, and enthusiasm for furthering NAFTA’s integration into future trade pact such as the Trans-Pacific Partnership.