Effects of North American Free Trade Agreement on agriculture and the rural economy
2002
S. Zahniser | J. Link
This report evaluates the impact of the North American Free Trade Agreement (NAFTA) on U.S. agriculture and the rural economy. The report begins with a broad overview of the impact of NAFTA on U.S. agriculture, and follows with a more detailed account of the effects on a number of commodities.Findings include:U.S. agricultural trade with Canada and Mexico has nearly doubled since the implementation of NAFTA, although only a portion of this overall increase can be attributed solely to the agreementNAFTA has allowed competitive market forces to play a more dominant role in determining agricultural trade flows among the three countriesby dismantling numerous trade barriers, the agreement has contributed to an expansion in U.S. agricultural exports and increased the domestic availability of various farm and food productsNAFTA has established rules and institutions that mitigate potential trade frictions and promote foreign direct investmentmany of the initial trepidations that were voiced concerning declining agricultural employment and environmental degradation have not materializedNAFTA should be judged not just in the context of the trade gains associated with the agreement’s agricultural provisions, but also in terms of the benefits derived from “locking in” key trade, investment, and institutional reforms in an increasingly integrated North American market[adapted from author]
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