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Mexico Free Trade Agreement

Mexico Free Trade Agreement: A Look at Its History and Impact

The Mexico Free Trade Agreement (MFTA) is an international trade agreement between the United States, Canada, and Mexico that was signed into law in 1994. This landmark agreement aimed to eliminate trade barriers between the three countries, promote economic growth, and create jobs. As a professional, let us take a closer look at the MFTA and its impact on the global economy.

History of the MFTA

The MFTA, also known as the North American Free Trade Agreement (NAFTA), was negotiated by the governments of the three countries in 1992, with the goal of creating a trilateral trade bloc. After several rounds of negotiations, the agreement was signed by President Bill Clinton, Canadian Prime Minister Jean Chrétien, and Mexican President Carlos Salinas de Gortari in San Antonio, Texas, on December 17, 1992.

The agreement took effect on January 1, 1994, and over the years, has undergone several changes and amendments to address concerns raised by various industries and workers in the member countries. The agreement also paved the way for the creation of the World Trade Organization (WTO) and inspired the creation of other regional trade blocs.

Impact of the MFTA on Trade and Investment

The MFTA had a profound impact on trade and investment in the region, as it eliminated tariffs on a wide range of goods and services, including automobiles, textiles, and agriculture. Since its inception, trade between the three countries has increased significantly, with Mexico becoming one of the United States` and Canada`s largest trading partners.

According to a report by the Congressional Research Service, trade between the United States, Canada, and Mexico increased from $290 billion in 1993 to $1.1 trillion in 2016. The report also found that the MFTA had a positive impact on employment in the region, with the creation of new jobs in industries such as agriculture, manufacturing, and service sectors.

The agreement also facilitated investment in the region, as it created a more favorable environment for foreign investment and reduced barriers to entry for businesses looking to expand their operations. As a result, the MFTA helped to increase the flow of capital and technology within the region, which contributed to the region`s overall economic development.


In conclusion, the Mexico Free Trade Agreement has played a critical role in transforming the economic landscape of the United States, Canada, and Mexico. While there have been criticisms and concerns raised over the years, the agreement has helped to create jobs, increase trade, and foster economic growth in the region. As we continue to navigate the complex terrain of international trade, the MFTA remains a shining example of the benefits and challenges of trade liberalization.