NAFTA and the G20

1. NAFTA and the G20 Presentation by: Aaron, Connor, Delainey, Jacob, and Laura

2. A BRIEF HISTORY The NAFTA agreement was signed on January 1st, 1994 by the Canadian Prime Minister Brian Mulroney, the Mexican President Carlos Salinas, and the U.S. President George W. Bush. The agreement was created to bring down the high trading costs, increase business investment and to give North America a more competitive edge in the global marketplace. Although it would not be possible if, in 1984, Congress hadn’t passed the Trade and Tariff Act which gave the president the power to negotiate free trade agreements.

3. Countries Involved UNITED STATES OF AMERICA CANADA MEXICO

4. MAIN OBJECTIVES • - to reduce barriers to trade • - to increase cooperation for improving working conditions in North America • - to create an expanded and safe market for goods and services produced in North America • - to establish clear and mutually advantageous trade rules • - to help develop and expand world trade and provide a catalyst to broader international cooperation

5. Advantages of NAFTA NAFTA is the acronym that represents the North American Free Trade Agreement that exists between the three countries of North America: Canada, Mexico and the United States. NAFTA was ratified as legislation in the three involved countries by late 1993 and the agreement officially came into effect on January 1st of 1994. When NAFTA was officially ratified the agreement created the world’s largest free trade area and effectively linked 439 million people. NAFTA has also generated a connection between the three involved countries which has led to other benefits such as agreements being generated to regulate labour and the environment in North America. (country facts.com)

6. -NAFTA allows trade become easier and efficient between Canada and other countries involved • -Canada has seen huge benefits with the increase in trade that has been generated • -NAFTA also benefits Canadians as NAFTA eliminates the high Mexican tariffs that traditionally existed on agricultural exports. • -NAFTA also benefits Canadians as goods produced in Mexico can enter Canada and the United States duty free helping to lower costs. • -NAFTA has also benefited Canadians as through the agreement a greater variety of products is available in the Mexican market. Trade of commodities is not the only thing that has grown in response to NAFTA as Canada also has benefited from an increase of trade in services. • -Under NAFTA businesses have become more profitable and competitive leading to job creation in Canada and the other partnered countries. • -Canada also directly benefits from the agreement as one in five Canadian jobs are at least in part related to trade. • -NAFTA also benefits Canadians as it increases investment, particularly foreign investment from the other countries involved in the agreement. • -creating the link between the three North American countries firms located in Canada, Mexico, or the United States are allowed to bid on government contracts which generates more opportunities and can help attract business. • -By easing making trade between 444 million people in three countries, NAFTA has more than tripled trade in less than 20 years. • -NAFTA reduced gas and food prices, by removing tariffs on Mexican oil imports. …

7. Disadvantages of NAFTA • -NAFTA is criticized for destroying American jobs and lowering U.S. wages. • -Others accuse NAFTA of exploiting Mexico's workers, destroying its farms and polluting its environment. In addition, NAFTA increases the U.S. trade deficit. • -NAFTA cost more than half a million jobs, as manufacturers moved to Mexico to take advantage of lower labor costs. • -The four states that suffered the most were California, New York, Michigan and Texas because they had had a high concentration of motor vehicles, textiles, computers, and electrical appliances industries. • -Rural Mexican farmers could not compete with low-cost corn and other grains that were exported by subsidized U.S. farm corporations. • -NAFTA put more than a million Mexican farmers were out of business. The ones that remained were forced to use more fertilizers and farm marginal land, resulting in more pollution and deforestation. • -Labor was cheap in Mexico because they had no labor rights or health protection. Thanks to NAFTA, nearly a third of Mexico's labor force were in this "maquiladora" program. • -U.S. Jobs Were Lost

8. Interesting Facts about NAFTA • NAFTA Economy: Today NAFTA covers a North American economy with a combined output of US$17.0 trillion. • NAFTA Population: The NAFTA region is home to 444.1 million people, 33.3 million of whom live in Canada, 304.1 million in the United States, and 106.7 million in Mexico. Canada created 4.3 million jobs between 1993-2008. United States created 25.1 million between 1993 – 2008. Mexico created 9.3 million between 1993 – 2008. TRADE WITH NAFTA PARTENERS : Canada $570.8 billion. America $919.9 billion. Mexico $156.0 billion.

9. Myths & Facts: Myth #1: After 14 years, we know NAFTA has not achieved its core goals of expanding trade and investment between the U.S., Canada, and Mexico. Fact: From 1993 to 2007, trade among the NAFTA nations more than tripled, from $297 billion to $930 billion. Myth #2: NAFTA has cost the U.S. jobs. Fact: U.S. employment rose from 110.8 million people in 1993 to 137.6 million in 2007, an increase of 24 percent. The average unemployment rate was 5.1 percent in the period 1994-2007, compared to 7.1 percent during the period 1980-1993. Myth #3: NAFTA has done nothing to improve the environment. Fact: NAFTA created two bi - national institutions unique to the agreement which certify and finance environmental infrastructure projects to provide a clean and healthy environment for residents along the U.S.-Mexico border. To date, they have provided nearly $1 billion for 135 environmental infrastructure projects with a total estimated cost of $2.89 billion and allocated $33.5 million in assistance and $21.6 million in grants for over 450 other border environmental projects. The Mexican government has also made substantial new investments in environmental protection, increasing the federal budget for the environmental sector by 81% between 2003 and 2008.

10. The History of g20 In September 1999, The group was launched in order to deal with international financial instability. It became apparent that a informal dialogue between advanced and emerging economies was crucial. (Representing all regions of the globe) The terrorist attacks on September 2001 was a large encouragement for other countries to join the G20 against the financing of terrorism. Recently the group has become a venue for discussing quota reform and representation at the International Monetary fund. The G20 also is an important role supporting globalization, making sure benefits are shared between all countries including the poorest developing countries.

11. Who’s involved? • The Group of 20 (or G20) is made up of 19 countries and the European union which together represent around 90% of global GDP, 80% of global trade and two-thirds of the world’s population. Countries: ArgentinaAustraliaBrazil Canada China France Germany India Indonesia Italy Japan Mexico Russia Saudi Arabia South Africa Korea Turkey United Kingdom United States European Union* • Each country is required to have a Finance minister and a Central Bank governor. As well as the current leader of the country.

12. Main Objectives Policy coordination between its members in order to achieve global economic stability, sustainable growth. To promote financial regulations that reduce risks and prevent future financial crises To create a new international financial architecture.

13. Benefits to Global Trade • Accounts for 80% of global trade • Major component of 2009 London summit was that free trade needed to increase, protectionism decrease • Result was a $250 billion package to finance world trade • WTO has attended every single summit

14. Limitations • Several notable countries are not in the G20 (ex. New Zealand, Norway, Switzerland) • Exclusiveness is biggest criticism • Countries often approach matters similarly • Many argue limited progress made during summits • Summits have a closed-door approach

15. Other Facts • G20 members account for: • 90% of global GDP • 64% of the world’s population • the production of 84% of the world’s fossil fuel emissions • 2010 G20 summit in Toronto had mass rioting • Lead to largest mass arrest in Canadian history at 1118 people