Has the North American Free Trade Agreement fulfilled its promise? An assessment after 15 Years

Abstract

AbstractFive years have passed since the North American Free Trade Agreement (NAFTA) celebrated its 10th anniversary. In that time, trade expansion among the United States, Mexico, and Canada continues to be strong, albeit in a more modest fashion than in the initial ten years of the agreement. This continued growth has not been without complications in the last five years, especially between the United States and Mexico. The corn and sugar trade have both sparked controversy, while trucking regulation remains an unresolved issue. Trade between the United States and Canada has largely been free of complications save for recent protectionist actions at the sub‐national level. These actions are due to misunderstandings concerning the 2009 economic stimulus bill passed in the United States. Many new players have emerged in the free trade landscape since NAFTA's 10th anniversary. Foreign direct investment, imports, and exports have all grown exponentially between the United States and China. Despite rising trade friction due to the global recession of 2008–2009, the North American Free Trade Agreement continues to generate net positive economic benefits for all three signatories.