ECN 500 CSU Global Campus US Mexico Canada Free Trade Agreement Paper

Description

USMCA has come under scrutiny recently. Using the concepts learned through this course and additional, scholarly research, evaluate USMCA.

Trace the historical performance of the U.S. and either the Canadian or Mexican economies since NAFTA passed
Identify industries that have grown since NAFTA and industries that have shrunk since NAFTA in each country.
Describe how USMCA is a free trade agreement.
Describe how USMCA is not a free trade agreement.
What major changes were made from NAFTA to USMCA? Specify from which country’s point of view the changes would be beneficial.
Portfolio Milestones attached – Summary and Annotated Bibliography with some of the sources I’ve identified. You are not limited to these sources.

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U.S. Mexico, Canada Free Trade Agreement (USMCA)
Kelly Goodnow
Colorado State University Global
ECN500: Global Economics
Dr. Barbara Leigh-Tonelli, Ph.D., MBA, CCIM
October 3, 2021
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U.S. Mexico, Canada Free Trade Agreement (USMCA)
Fully enforced by January of 1994, the North American Free Trade Agreement (NAFTA)
was created by government negotiations with the United States, Mexico and Canada. NAFTA
was created to eliminate tariffs charged on products that were traded between these countries and
created a great focus on removing restrictions on trade in agriculture, textiles, and automobile
manufacturing (Chatzky, 2020). NAFTA was also created with the desire to protect intellectual
property, put dispute resolution mechanisms in place and address the implementation of
safeguards for labor and the environment (Chatzky, 2020). According to Chatzky (2020) the
hope behind NAFTA was that freer trade would encourage a stronger and steadier growth for
Mexico’s economy through new job opportunities for their workforce and to discourage illegal
migration.
It was NAFTA’s creation that has been regarded as responsible for the reshaping of
economic relationships in North America, and that drove an unparalleled union between the
United States and Canada’s developed economies, as well as Mexico’s developing economy.
NAFTA has garnered both positive and negative attention over the years with economists
claiming that NAFTA has either been great for the U.S. Mexico and Canadian imports and
exports or that it created weaknesses in the U.S. that allowed for many manufacturers to move
their jobs to lower-cost Mexico, effectively causing U.S. businesses to lower their own wages to
compete. This paper will discuss which industries benefited from the trade agreement and which
industries declined due to the agreement in each country, discuss if the USMCA is a free trade or
non-free trade agreement, and the major changes that were made from NAFTA to USMCA.
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References
Amadeo, K. (2016, November 30). NAFTA’s 6 negative effects. Retrieved October 3, 2021,
from
https://www.vanderbilt.edu/olli/class-materials/2017Spring.GDBrentwoodNAFTA.pdf
Chatzky, A. (2020, July 1). NAFTA and the USMCA: Weighing the impact of North American
trade. Retrieved October 3, 2021, from
https://www.cfr.org/backgrounder/naftas-economic-impact
CRS Reports. (2003, October 30). Industry trade effects related to NAFTA. Retrieved October 3,
2021, from https://www.everycrsreport.com/reports/RL31386.html
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Annotated Bibliography
Kelly Goodnow
Colorado State University Global
ECN500: Global Economics
Dr. Barbara Leigh-Tonelli, Ph.D., MBA, CCIM
Due Date
2
Annotated Bibliography
Amadeo, K. (2016, November 30). NAFTA’s 6 negative effects. Retrieved October 3, 2021,
from
https://www.vanderbilt.edu/olli/class-materials/2017Spring.GDBrentwoodNAFTA.pdf
Amadeo’s (2016) work discusses the negative ramifications of the NAFTA agreement,
identifying 6 of NAFTA’s weaknesses. First and foremost is that NAFTA made it possible
for many U.S. manufacturers to move jobs to lower-cost Mexico. The manufacturers that
remained in America lowered their wages to compete in those industries (Amadeo, 2016).
The importance of Amadeo’s work helps identify the reasons why Donald Trump promised
to renegotiate or withdraw from NAFTA. This reference is relevant to my portfolio project
because it addresses some of the industries that shrunk under NAFTA. Kimberly Amadeo
is the current president of World Money Watch and is backed by 20 years of experience in
economic analysis and business strategy and a Master’s in Business Administration.
Amadeo’s background and understanding of finance and world economics makes her
an important source of information.
Chatzky, A., McBride, J., Sergie, M. (2020, July 1). NAFTA and the USMCA: Weighing the
impact of North American trade. Retrieved October 3, 2021, from
https://www.cfr.org/backgrounder/naftas-economic-impact
Chatzky et al., (2020) in their article NAFTA and the USMCA: Weighing the Impact of
North American Trade discusses how NAFTA affected the economies of the United States
and Mexico, as well as the impact on Canada. Much of the debate among policy experts
has centered on how to mitigate the negative effects of deals such as NAFTA, including
whether to compensate workers who lose their jobs or provide retraining programs to help
them transition to new industries (Chatzky et al, 2020). This resource provides a look at
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some of the major changes that were addressed in regards to NAFTA and the USMCA and
is a relevant resource for building on which country’s point of view the changes would be
beneficial. Chatzky et al., are all members of The Council on Foreign Relations, an
independent, nonpartisan membership, and organization that is dedicated to being a
resource for those seeking to better understand the world and the foreign policy choices
facing the United States and other countries.
CRS Reports. (2003, October 30). Industry trade effects related to NAFTA. Retrieved October 3,
2021, from https://www.everycrsreport.com/reports/RL31386.html
CRS Reports (2003) goes in-depth into the effect that NAFTA had on industry trade flows
on both imports and exports, as well as impacts on key industries such as textiles and
automotive. The relevance of this report is to help build a better understanding of industry
effects from NAFTA to compare with the USMCA agreement. This source also piggybacks
on the previous source from Chatzky et al. (2020). CRS Reports works with the
Congressional Research Service, to provide valuable insight and non-partisan analysis of
issues of public debate.
Gladstone, F., Liverman, D., Sánchez Rodríguez, R. A., & Morales Santos, A. E. (2021).
NAFTA and environment after 25 years: A retrospective analysis of the US-Mexico
border. Environmental Science & Policy, 119, 18–33.
https://doi.org/10.1016/j.envsci.2020.10.017
Gladstone et al. (2021) take time to discuss the historical performance of the U.S. and
Mexican economies since NAFTA passed. This paper asks what lessons NAFTA offers
to contemporary debates about trade and environmental governance through analysis of
time series data and expert perceptions on the environment of the US-Mexico borderlands
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(Gladstone et at., 2021). This source is a relevant and valuable resource to build the
beginning foundation of my portfolio project and will help me set the tone for the rest of
the paper. NAFTA and Environment After 25 Years: A Retrospective Analysis of the USMexico Border is a peer-reviewed article that is subject to more scrutiny by experts in the
same field as the publication than websites or blogs are to ensure the paper’s validity and
whether it is suitable to be published.
Knox, J. L. (2019). People will always remember how you made them feel: The key differences
between the apparel sections of the North American free-trade agreement (NAFTA) and
the United States, Mexico, and Canada trade agreement (USMCA). Journal of Applied
Business and Economics, 21(4), 64–70. https://doi.org/10.33423/jabe.v21i4.2131
Knox’s article is an analysis of the key differences between the apparel sections of the
United States, Mexico, and Canada Trade Agreement (USMCA) and the North American
Free Trade Agreement (NAFTA) was conducted to determine the amount of progress
made in the USMCA deal with regard to apparel exports (Knox, 2019). this resource will
help me understand the USMCA agreement to help determine whether it is a free trade
agreement or a non-free trade agreement. People Will Always Remember How You Made
Them Feel: The Key Differences Between the Apparel Sections of The North American
Free-Trade Agreement (NAFTA) and The United States, Mexico, and Canada Trade
Agreement (USMCA) is another peer-reviewed article that undergoes the same scrutiny
and evaluation as other scholarly sources to ensure accuracy before being published.
Labonté, R., Gleeson, D., & McNamara, C. L. (2020). USMCA 2.0: a few improvements but far
from a ‘healthy’ trade treaty. Globalization and Health, 16(1).
https://doi.org/10.1186/s12992-020-00565-4
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Labonté et al. (2020) go in-depth to discuss USMCA amendments that include revising or
deleting tough, new measures for pharmaceuticals, rules on the protection of labor rights,
and procedures for investigating such a complaint or resolving a formal dispute. A peerreviewed article subject to the same scrutiny and evaluation all scholarly sources are
mandated to go through before they can be published, Labonté et al. and their article
titled USMCA 2.0: A Few Improvements But Far From a ‘Healthy’ Trade Treaty are a
great resource to help gain a better understanding of the process that was gone through to
create and put into effect the USMCA trade agreement and will be a valuable resource to
help build background around USMCA for my paper.

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NAFTA

US Mexico

Canada Free Trade Agreement

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