In simple words, NAFTA is free trade agreement between Canada, USA and Mexico. Its aim was basically to promote tariff-free trade. US President Ronald Regan proposed a North American common market in his campaign. Further, Regan’s successor President H W Bush began negotiations with Mexican President Salinas for a liberalized free trade agreement between the two countries.
Before NAFTA Mexican Tariffs on U.S. Imports were 250 percent higher than U.S tariffs on Mexican Imports. And Finally, NAFTA made in 1993. NAFTA was criticised at its initial stages because American people thought that it will decrease the jobs in America as American companies will get cheaper labour in Mexico. But according to their President, NAFTA could decrease the illegal migration from Mexico. But it resulted in an incline in illegal migration from Mexico because NAFTA made Mexico’s farmer poorer as American corn companies started dumping in Mexico. Further, it led to decrease in the wages of labours. Basically, it has resulted in negative for both the countries because it decreases the employment in USA and wages of labours in Mexico. On the flip side of the coin, it has resulted in the increase in GDP of USA.
So, as Today’s scenario Naftafullfiled seven of its goals which made it world’s largest free trade area in terms of gross do, domestic product. Further, it increased the competitiveness of the three countries in the global marketplace. This has become critical since the launch of the European Union. Trump wants to eliminate NAFTA because according to him it is the loss for the USA. Because Trump supports the manufacturing jobs in America and wants to increase employment. Apart from this Trump called NAFTA the “worst trade deal in history” and blames it in loss of manufacturing jobs in America’s Rust Belt.