Both Democratic presidential candidates Hillary Clinton and Barack Obama threatened on the stump that they would withdraw from North American Free Trade Agreement (NAFTA), if elected. This rhetoric goes beyond vote-bank politics to hardcore facts of Mexico’s surge as one of the leading exporting nations of the region. NAFTA came into effect in 1st Jan 1994, since then, the country witnessed an envious economic growth particularly due to the trade pact.
Luis de la Calle, an economist in Mexico City and one of the country’s NAFTA negotiators, averred that Mexican exports to the US have quadrupled from about $60bn (€40bn, £30bn) a year to $280bn a year. He was of the opinion that it was not a one-sided success story, but the other end, the US too was able to increase exports to Mexico from $41bn in 1993 to the realm of $136bn last year.
Post NAFTA scenario in the state of Ohio is shown as an example, Ohio had 990,000 manufacturing jobs in 1994. Two years later, it rose to 1.03 million and the number remained stable above one million for the rest of the 1990s, before plummeting in this decade to just 775,000 today. Mexican economists’ argue that blaming NAFTA for all the economic ills of the US is unfair because there are several other reasons for unemployment in the US.
The economists do not deny the fact that Mexican standard of living has improved by leaps and bounds during this period. Ernesto Cervera, an economist and a Mexico City think-tank, agrees that the average cost of white goods today is at least 50 per cent less than pre-NAFTA. And this has facilitated, average Mexican to afford all mod cons equivalent to that of the US. There is evident proof that Mexico has made substantial growth post-NAFTA by taking trade deficits to manageable levels.
Major contributing factors for Ohio losing jobs are the emergence of China, India and the old Soviet Bloc which have pumped in thousands of workers to the global economy. Blaming the trade pacts, even for the sake of votes is not justifiable because these pacts, one way the other are instrumental in improving the quality of lives around the world, which is basically the brain child of the US.