Twenty Years on, Mexico Is NAFTA's Biggest Lie
Friday, 03 January 2014 11:13 By Jaisal Noor, The Real News Network | Video Interview
JAISAL NOOR, TRNN PRODUCER: Welcome to The Real News Network. I'm Jaisal Noor in Baltimore.
On January 1, 1994, the North American Free Trade Agreement went into effect. Removing barriers for trade between Mexico, Canada, and the United States, NAFTA created the world's largest free trade area, now linking 450 million people producing $17 trillion worth of goods and services.
Now joining us to discuss this is Timothy A. Wise. He directs the Policy Research Program at the Global Development and Environment Institute at Tufts University. He's the author of the recent article "How Beer Explains 20 Years of NAFTA's Devastating Effects on Mexico".
Thank you so much for joining us, Tim.
TIMOTHY A. WISE, DIRECTOR, RESEARCH AND POLICY PROGRAM, GLOBAL DEVELOPMENT AND ENVIRONMENT INSTITUTE: It's a pleasure to be here.
NOOR: So, Tim, much of the media is celebrating 20 years of NAFTA. I was reading a piece in The Economist which talks about the benefits that NAFTA has brought the U.S., Canada, and Mexico. It singles out Mexico for having received the greatest amount of benefits from NAFTA. And the article says the only problem is that we're not expanding free trade quick enough. What's your response? What's been the real story of NAFTA, especially on Mexico, in the last 20 years?
WISE: Well, I think it's--that kind of interpretation really misses the--it ignores the underlying and very clear economic evidence that Mexico has performed far more poorly than other middle-income countries who have not been part of agreements like that. And that's all the more remarkable given that, as one of my coauthors on the piece--I think it was our retrospective on NAFTA at 15--Eduardo Zepeda, then of the Carnegie Endowment, said no country will ever have the benefits, the advantages that Mexico had entering NAFTA, and if Mexico can't make it work, we really have to rethink these agreements. Mexico had a 200 mile border with the United States, the largest--the United States being the largest consumer market in the world to consume Mexico's products. It had the longest economic expansion in the United States' history going on right after NAFTA was signed. And it had a surge--it got the surge it wanted in foreign investment, which tripled. It got a surge in trade, which increased dramatically. It kind of got everything it wanted and yet still showed remarkably slow levels of economic growth, incredibly poor job creation, and a real lack of strategic development over the course now of 20 years. It's anything but a poster child for development. In fact, I think out in the world it's seen as more of a warning sign to other developing countries about signing such agreements.