NAFTA - United States, Canada, and Mexico Trading Together Research Paper

NAFTA - United States, Canada, and Mexico Trading Together - Research Paper Example It was actually signed by President George H. W. Bush along with Mexican President Salinas, and Canadian Prime Minister Brian Mulroney in 1992. Ratification of the legislature by the three countries took place in 1993. By campaigning on a common market, President Ronald Reagan actually began formation of NAFTA, which lead to the passing of the Trade and Tariff Act in 1984. The act gave the president authority to negotiate the free trade, but only allowing Congress the ability to approve or disapprove. Congress was not allowed to change any negotiating factors. Canada and the United States began negotiations for the Canada and US free trade agreement, which was put into effect in 1989. This treat is now suspended due to the onset of NAFTA. Mexican President Salinas and President Bush began negotiations for a trade agreement between Mexico and the United States. History shows that Mexican tariffs on US Imports were 250 per cent higher than US tariffs on Mexican imports. Canada was the first to suggest an agreement between the three countries, which lead to NAFTA. Since the signing of the NAFTA agreement in 1994, two addenda have been added. NAFTA has linked 450 million people from differing countries producing $17 trillion worth of services and goods. NAFTA was originally signed into law for a period of 15 years. NAFTA eliminated tariffs and created an agreement based on the rights of international business investors. This reduced the cost of trade, which promotes growth and investment. Eliminating tariffs also reduces inflation by lowering the cost of imports. Some features of NAFTA that specify its purpose were to eliminate existing barriers to trade and make effective the cross-border movement of services and goods. It was also to promote an atmosphere of fair competition. This, in turn, created increased investment opportunities for all three countries. Other features included providing enforcement and protection of intellectual property rights and creating procedures for the resolution of trade disputes.