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The agreement immediately ended tariffs on some goods, and on other goods tariffs were scheduled to be eliminated over a period of time.

The agreement was an expansion of the earlier Canada-U.S. Free Trade Agreement of 1989. Unlike the European Union, NAFTA does not create a set of supranational governmental bodies, nor does it create a body of law which is superior to national law. NAFTA, as an international agreement, is very similar to a treaty (indeed, in Spanish, it is styled a tratado). Under United States law it is classed as a congressional-executive agreement.

1 Effects

NAFTA has been controversial since it was first proposed. Transnational corporations have tended to support NAFTA in the belief that lower tariffs would increase their profits. Labor unions in Canada and the United States have opposed NAFTA for fear that jobs would move out of the country due to lower wage costs in Mexico. Farmers in Mexico have opposed NAFTA because the heavy agriculture subsidies for farmers in the United States have put a great deal of downward pressure on Mexican agricultural prices, forcing many out of business. Opposition to NAFTA also comes from environmental, social justice, and other advocacy organizations that believe NAFTA has detrimental non-economic impacts to health, environment, etc. In Mexico, NAFTA's approval was quickly followed by an uprising amongst indigenous people led by the Zapatistas, and tension between them and the Mexican government remains a major issue.

Since NAFTA was signed, it has been difficult to analyze its macroeconomic effects due to the large number of other variables in the global economy. Various economic studies have generally indicated that rather than creating an actual increased trade, NAFTA has caused trade diversion, in which the NAFTA members now import more from each other at the expense of other countries worldwide.

From the perspective of North American consumers, the most prominent effect of NAFTA has been the significant increase in bilingual or even trilingual labeling on products, for simultaneous distribution through retailers in Canada, the U.S., and Mexico.

2 Further reading

• David Bacon. The Children of NAFTA: Labor wars on the U.S./Mexico Border. Berkeley: University of California Press. 2004. BooksEnthsiast.com.
• Washington Post - As Accusations Fly, Poor Nations Suffer

3 See also

• Central American Free Trade AgreementThe Central American Free Trade Agreement (CAFTA is a free trade agreement between the United States and the Central American countries of Costa Rica, Guatemala, El Salvador, Honduras, and Nicaragua. The goal of the agreement is the creation of a free tra
• Free Trade Area of the AmericasThe Free Trade Area of the Americas or FTAA (in Spanish: rea de Libre Comercio de las Americas, ALCA in French: Zone de libre-echange des Ameriques, ZLEA in Portuguese: rea de Livre Comercio das Americas, ALCA is a proposed agreement to eliminate or reduc
• Free Trade
• Agricultural subsidiesAn agricultural policy or agricultural subsidy is an incentive to engage in a particular form of agriculture. It often takes the form of tax reductions, favorable deals on equipment, and so on. Subsidies status Currently, economic studies place the averag
• maquiladoraA maquiladora is a factory, the majority of which are located in Mexican border towns, that imports materials and equipment on a duty- and tariff-free basis for assembly or manufacturing. The main use of these assembly plants were to put together imported
• anti-globalization movement
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• Fair Trade Initiative