NAFTA Country Impacts: 25 Years After Implementation

Abstract

This study reviews research on various aspects of trade, free trade agreements, and NAFTA specifically. With the twenty-fifth anniversary of the NAFTA enactment in January of 2019 between Canada, Mexico and the U.S., it is an opportune time to review some of the history and expectations leading up to the agreement. The economic performances of the three countries are also evaluated over the twenty-five year study time frame. Eleven metrics are used to make a general assessment as to whether the actual country performances matched the expectations. Based on the data, NAFTA was a positive influence on the three countries. Tariffs were reduced; FDI was increased; trade grew between the three countries especially intermediate trade related to supply chains; savings rates increased; inflation was reduced; unemployment also fell for two of the three countries while GDP per person soared for those same two countries. In summary, NAFTA was a success.