CRS Reports on NAFTA Effect on U.S.-Mexico Economic Relations
The Congressional Research Service has issued a report entitled “NAFTA and the Mexican Economy,” which discusses the effect of the North American Free Trade Agreement on U.S.-Mexico economic and trade relations.
Sign up for a free preview to unlock the rest of this article
Timely, relevant coverage of court proceedings and agency rulings involving tariffs, classification, valuation, origin and antidumping and countervailing duties. Each day, Trade Law Daily subscribers receive a daily headline email, in-depth PDF edition and access to all relevant documents via our trade law source document library and website.
Congress Has Considered Renegotiating Parts of NAFTA
CRS reports that a number of policymakers have raised the issue of revisiting NAFTA and renegotiating parts of the agreement. In the 111th Congress, major issues of concern are related to U.S.-Mexico trade issues, economic conditions in Mexico, the effect of NAFTA on the U.S. and Mexico, and Mexican migrant workers in the U.S.
NAFTA Benefits to Mexico Have Not Been Evenly Distributed
CRS states that while NAFTA may have brought economic and social benefits to the Mexican economy as a whole, the benefits have not been evenly distributed throughout the country and certain sectors. For example, the agricultural sector experienced a higher amount of worker displacement after NAFTA, in part because of increased competition from the U.S. but also because of Mexican domestic agricultural reforms.
In terms of regional effects, initial conditions in Mexico appear to have determined which Mexican states experienced stronger economic growth as a result of NAFTA.
Some economists argue that while trade liberalization may narrow income disparities over the long run with other countries, it may indirectly lead to larger disparities in income levels within a country.
May 2010 U.S. and Mexico Agreement on Global Competitiveness Initiative
CRS notes that President Obama met with Mexican President Calderón in May 2010 and agreed on a global competitiveness initiative that reaffirmed their commitment to increasing cooperation in a wide range of issues, including enhancing mutual economic growth.
Key Component to Competitiveness is Upgrading Border Facilities
According to CRS, a key component for their global competitiveness initiative is to create a border that will expand and modernize border facilities for a secure and more efficient border.
(CRS also recently issued a report entitled “North American Free Trade Agreement (NAFTA) Implementation: The Future of Commercial Trucking Across the Mexican Border,” which discussed Mexican trucking statistics and the future of U.S.-Mexico cross-border trucking under NAFTA. See ITT’s Online Archives or 07/16/10 news, 10071623, for BP summary.)
(Report dated 06/03/10)