NAFTA — the North American Free Trade Agreement — is a comprehensive, groundbreaking free trade and investment agreement which took effect on 1 January 1994, involving the governments of Canada, Mexico and the USA.

It is an expansion of the 1989 Canada-US Trade Agreement (CUSTA) and is seen as a landmark in setting higher standards in a range of areas, including agriculture, investment, intellectual property, and services.

NAFTA, dubbed a “death sentence” for Mexico’s campesinos and Indigenous Peoples, has led to strong and sustained resistance from a broad spectrum of Mexico’s population. It was one of the catalysts for the Zapatista uprising. Since it came into effect, cheap, subsidized US corn has flooded the market, sold at prices below the cost of production, with which campesinos cannot compete. This has led to massive displacement, poverty, and hunger.

NAFTA disputes - in which an investor from one signatory country can sue the government of another signatory country for actions or omissions which it claims to interfere with its right to make a profit - have raised concerns about the way in which the agreement furthers the interests of transnational corporations, and limits the capacity of governments to regulate the economy for social, environmental or other reasons.

On 1 January 2008, the last agricultural tariffs were eliminated under NAFTA and small farm organizations in Mexico declared “all-out war” on the trade agreement, arguing that the country’s food sovereignty and security are in peril. Massive peasant demonstrations against NAFTA were held throughout Mexico in early 2008.

NAFTA was a key focus of the US 2008 presidential campaign debates, with Barack Obama calling for its renegotiation. However, the call has not been acted upon under his administration.

last update: May 2012

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