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洞悉加拿大北美自由贸易协定 加拿大是北美洲最北面的国家。传统上，大家都知道它与南面的国家——美国有着非常紧密的关系。位于美国南方的墨西哥，一直在政治上与它的邻国保持着距离。然而，在20世纪的最后十年，这三个国家为了经济的稳定聚集在一起签署了北美自由贸易协定(NAFTA)。自那时以来，在一大的地理区域发生了许多社会、经济和政治变革。北美自由贸易协定负责这些国家内部和各国家之间大部分的社会发展。经济上，北美从日益增加了国际贸易中获得了很多好处。每个国家的公民已经慢慢习惯了北美自由贸易协定，并且一起努力发掘其潜力。由于北美自由贸易协定是一个历史性的协议，它已经被许多的专业人士所审核和分析，他们希望发现其优势的来源及其出现弱点的原因。本文的目的是关注加拿大在北美自由贸易协定中所扮演的角色，来描述包括加拿大的会员在内的经济因素，并讨论北美自由贸易协定的优势和劣势，以及其在二十一世纪所面临的挑战。 An insight into canada nafta Canada is the northernmost country in North America. Traditionally, it has been known to have a close relationship with the country beneath it—the United States of America. Mexico, the country below the U.S. has politically maintained its distance from its neighbors. Yet, these three nations came together for the sake of economic stability when they approved the North American Free Trade Agreement (NAFTA) in the last decade of the twentieth century. Since then, there have been many social, economic, and political changes to this large geographical region. NAFTA is responsible for much of the social progress within and between these countries. Economically, North America has gained many benefits due to the increased international trade. Citizens of each country have grown accustomed to NAFTA and have come together in order to realize its potential. Because NAFTA is a historic agreement, it has been scrutinized and analyzed by countless professionals who wish to uncover the source of its strengths and the reasons for its weaknesses. The purpose of this paper is to focus on Canada’s role in NAFTA, to describe the economic factors involving Canada’s membership, and to discuss NAFTA’s advantages, disadvantages, and challenges in the twenty-first century. Canadian Economy Canada is one of the largest economies in the world, and, as a result, it is a wealthy and competitive nation that boasts a service-centered industrial base. Having a market-oriented economic system, Canada has traditionally been compared to the United States, its North American neighbor. Both nations are rich in natural resources and have rather large manufacturing sectors. In Canada, the oil and logging industries are predominantly powerful. Other natural resources commonly found in the economic sector are coal, iron ore, and gold. Additionally, energy and agriculture are two other important industries that help to keep the country’s economy strong. “As the overall Canadian economy has matured, the economic importance of Canada's primary industries has declined. By 2002, the primary industries combined generated just under 6% of Canada’s gross domestic product (GDP, the value of all goods and services produced in Canada)” (“Primary Industries,” 2003, para. 1). Since its early beginnings, Canada has been viewed as a rich supplier of staples (raw materials and primary processed manufactures) (Hayter and Barnes, 2001). Consequently, other countries look to it for goods and materials and often profit from foreign ownership of its resource production. For instance, “Canada ships 87 percent of its merchandise trade exports to the United States” (Myles and Cahoon, 2004, para. 2). Agriculture (vegetables, poultry, and livestock) and energy(oil, gas, and hydroelectric) are key exports for which Canada has become popular around the globe. In particular, Canada maintains a lasting relationship with the United States, in which total trade between the two countries has reached $411 billion (Myles and Cahoon, 2004). Manufacturing and construction are secondary industries that support Canadians well. These sectors are highly interdependent, as they produce necessary goods, such as automobiles, buildings and computers, in a global society. As Canadian markets expand, employment in the manufacturing sector increases. When the manufacturing and construction are productive, the economy prospers. The country’s current outlook for high commodity prices is very good. Hunkar (2009) reports that Canada is one of the few countries in the Organization for Economic Co-operation and Development (OECD) that has had a surplus in its current account balance for several years (See Appendix A). Consequently, the country also has a strong fiscal balance, which helps to protect it against the worldwide credit crisis (See Appendix B). Thus, Canada is enjoying solid economic growth due to prudent fiscal management and the production of consecutive balanced budgets from 1997 to 2007 (“Canada Economy 2009,” 2009). The service sector is a steadily growing area in Canadian economy. Canadians labor in offices, stores or warehouses as opposed to farms, mines, or mills. Since the country is becoming a knowledge-based economy, many more workers are involved in the service sector. This benefits the society and culture of Canada, making its population more advanced in terms of global technology. As technological achievements help to improve industrial organizations, workers receive higher wages for their skills. For instance, health, education, business, and financial service organizations dominate this sector, allowing workers to earn substantial household incomes. “More than two-thirds of the country's output is contributed by the Services sector, which employs nearly three-quarters of the working population“(“Economic Structure of Canada,” n.d., para. 1). This sector includes an enormous civil service as well as other segments, such as banking, insurance, education, communication and consulting. NAFTA and Canadian Membership The North American Free Trade Agreement (NAFTA) was established on January 1, 1994. The main purpose of NAFTA is to form an alliance between the United States, Canada, and Mexico based on a triangular trading block on the North American continent. According to Nicholson (1999), “NAFTA is nothing new, it is the extension of the World Trade Organization and the natural development of the US-Canada Free Trade Agreement (FTA) which now has ten years” (p. 1). NAFTA boasts a successful vertical integration in terms of the North American economy, which involves four broad types of border flows. These patterns include trade in goods, trade in services, investments, and people (Schwanen, 2003). With the implementation of NAFTA came the end to trade restrictions, such as tariffs, particularly between the U.S. and Mexico. In terms of the composition of NAFTA, there are many parts to this agreement. For instance, each of the three governments wrote a series of resolutions. Next, they adopted six specific objectives from the resolutions list. Additionally, “NAFTA is supported by a series of national legislation to allow internal modifications, letters, statements, and regulations” (Nicholson, 1999, p. 4). NAFTA’s policies have been quite influential in the elimination of trade barriers between all of its members. This led to an increase in market access for goods, and it caused benefits which increased import/export deals between countries. Furthermore, as Nicholson (1999) suggests, “NAFTA strengthened, clarified, and simplified rules contained in the FTA and NAFTA rules superseded the FTA rules” (p. 5). Thus, the framers sought to revitalize the North American economy by joining the three largest countries in a mutually beneficial pact. Its provisions ensured not only duty-free access to manufactured goods and commodities, but also helped U.S. and Canada to gain access to Mexican markets in banking, insurance, advertising, telecommunications, and trucking (“NAFTA,” 2007). Although Canada was initially cold to the idea of extending the FTA to a third country, it soon accepted and even welcomed the change. Nicholson (1999) surmises that Canadian leaders began to realize that U.S. and Mexico would form a partnership with or without their country’s support. This realization prompted Canada to rethink the terms of the agreement carefully. Accordingly, they had to come to terms with the negotiation processes. Their main objectives were as follows: (1) to ensure U.S. protection, (2) to put an end to tariffs, (3) to maintain Canadian cultural industries, and (4) to gain insulation from arbitrary application of U.S. trade remedy laws (Nicholson, 1999, p. 2). Canada had much at stake in the weighty matter of NAFTA. The country’s leaders had to overcome their apprehension and look at the economic facts of the case. The primary goal of Canada was to get better access to the U.S. for trade as well as for matters of the environment and agriculture. It stood to gain a great deal in terms of economic rewards from the acceptance of NAFTA. The vision of NAFTA proponents was to establish rights and obligations regarding trade in services, intellectual property, and international investment (Schott, 2009). Canada finally agreed to the terms in order to strengthen both its domestic agenda and its foreign policies. NAFTA and Canadian Economy #p#分页标题#e# As a result of NAFTA, “greater integration has had a positive effect on Canada’s productivity performance” (Schwanen, 2003, p. 4). International trade is big business for Canadians. According to statistics, one out of every five Canadians works in organizations that specialize in foreign trade, which gives the country a competitive advantage (“Fast Facts,” 2009). The globalization of markets has also positively affected Canada, which is the second largest country in the world. As citizens concentrate their work ethics, they must also meet the demands associated with a very high standard of living. Hence, the labor force is constantly growing in terms of job creation and growth. Canada’s strong, diversified economy has been fortified in the wake of NAFTA. In 2003, “employment surged forward during the last four months leaving the labor market with healthy gains for the year” (“Employment,” 2004, para. 1). The steady increase in employment from 1996 to 2003 can be linked to the early years of NAFTA implementation (See Appendix C). Even after the recessions of 1981-1982 and 1990-1991, it was not until 1994, the first year of NAFTA, that employment made an upward turn. Then, by 2007, Canada was making great economic strides and boasted better employment growth than the U.S. Jobs in the service sector increased steadily during this period in time. People working in professional, scientific, and technical services benefited greatly. Likewise, jobs in the goods-producing sector were up in manufacturing and utilities (“Unemployment Rate At 6%,” 2007). Overall, during 2007, there was a general upward shift in the number of working Canadians. On the contrary, some Canadians remained either jobless or self-employed. Others working in the public sector saw declines in available work due to the gains made by private sector employees (“Unemployment Rate At 6%,” 2007). In terms of Canada’s provinces, each one recorded high employment levels in 2007. In particular, the province of Alberta continued its job expansion programs. Consequently, its workforce grew to 4.7%, which was a nation-leading figure (“Labor,” 2009). British Columbia and Quebec also witnessed growth in jobs, especially in the services sector. As for Canada’s current economy, there is much evidence to support NAFTA’s influence in the country. Statistics show that unemployment declined to 8.4% in September, 2009 (“Canadian Unemployment,” 2009). Jobs creation also improved and concentrated on preparing youth and female workers. On the other hand, 395,000 jobs were lost since October, 2008, especially in the transportation and warehousing sector (“Canadian Unemployment,” 2009). Accordingly, there is a fine balance between performance and productivity, which is measured by careful analysis. Labor market analysts state that the current employment rate for the whole country is 65.1% (the lowest since 2001) (“September Employment,” 2009). Additionally, Argitis (2009) asserts, “Canadian employees added jobs for the second straight month in September, and the unemployment rate unexpectedly fell, adding to evidence the U.S.’s largest trading partner is emerging from its recession” (para. 1). This is great news for NAFTA supporters who feel that the agreement is partly responsible for the boon in Canadian economy. According to the 2006 Census, Canada’s labor market has changed dramatically since the 2001 Census. “Canada’s employment growth averaged 1.7% in each of the five years, higher than the average among members of the Group of Seven (G7) (“Labor,” 2009, para. 15). More workers with differences are entering the workforce. For instance, older workers are still influential on the job site as well as young workers who need to be trained. Women and minorities are another group that is entering Canadian workplaces in record numbers. Moreover, unemployment rates continued to fall in 2007 (See Appendix D). For example, for people who could not find jobs, time spent unemployed was only 14 weeks (“Labor,” 2009). This statistic suggests that most Canadian workers fare better than Americans in terms of job security. As a result, Canada’s economy is thriving as workers retain their positions and earn good livings. NAFTA and Canadian Imports/Exports Canada’s main trading partners outside the members of NAFTA are Japan and China. Not surprisingly, the U.S. is Canada’s number one trading partner. The U.S. accounts for more than three quarters of the exports and more than half of the imports (“U.S. Still Canada’s,” 2009). Likewise, Mexico is also a major trading partner, especially in terms of imports. Thus, NAFTA has a powerful effect on Canada’s international trade. Canada’s trade with the U.S is phenomenal. For example, “Canada exported US$303.4 billion worth of merchandise to the United States in 2006” (Workman, 2007, para. 2). Some of the most expensive products exported to the U.S. include: petroleum, cars, car parts, aluminum, lumber, plastics, and telecommunications. On the other hand, products imported to the Canada from the U.S. include: cars, trucks, engines, plastics, computer accessories, iron and steel. As shown by Appendix E, Canada has a large variety of exported products, as merchandise exports rose 2% to a record $463.1 billion in 2007 (“Statistics Canada,” 2008). The automotive and forestry industries suffered some losses; whereas, the agricultural and fishing industries grew. Consequently, the country’s imports also fared well in 2007. Because every sector showed growth, imports increased 3% to a total of $415.1 billion (“Statistics Canada,” 2008). Appendix F illustrates the advancement of imports in all sectors. Some products that were successfully imported include: household furnishing, clothing, machinery, and pharmaceutical products. Due to economic growth, many Canadians are seeing significant progress in income and investments. “From 1997 to 2006, the median after-tax annual income of families composed of two or more people grew 18% from $49,400 to %58,300” (“Statistics Canada,” 2008, para. 2). These statistics pinpoint the upward mobility and high standard of living in Canadian society twelve years after NAFTA. As a result, Canadians are investing in their futures. There have been a record number of contributions to retirement savings plans. For instance, citizens are reporting that they have investment incomes, which are steadily increasing. In 2006, the amount of investments grew 16% and reached $40.9 billion (“Statistics Canada,” 2008). NAFTA: Advantages, Disadvantages, & Challenges The main advantage of NAFTA is that it opens up the level of trade between the U.S., Canada, and Mexico. With that said, there are still several secondary advantages to this agreement that facilitate better relations between its members. As a result of NAFTA, there is a renewed sense of patriotism for North Americans who live in a vast land of opportunity. Because of NAFTA there is a higher quantity and quality of traded goods on the market. This has a positive effect on U.S., Canada, and Mexico citizens because their standard of living is improving. Along with a high standard of living comes the responsibility of the country to not only maintain wealth, but to also share it, in some cases. By establishing a cooperative social, economic, and political climate, NAFTA members aid each other. People in NAFTA countries are benefiting from not only trade and commerce, but they are also benefiting from a reduction in protectionism. These countries are moving toward a decentralized and democratic capitalism (Griswold, 2002). Therefore, in addition to socioeconomic factors, NAFTA also has many political implications. As each government seeks to reap the most rewards from NAFTA, each country’s citizens are the real winners. People in every Canadian province have received benefits due to the agreement. For instance, the integration of North American agriculture helps the workers as well as the consumers. For the producers or workers market integration leads to new sales territories, access to cheaper inputs, and new opportunities for foreign direct investment (FDI) (Zahniser and Crago, 2009). For the consumers, market integration causes better purchasing power due to lower prices and also improves the selection of goods and services. Therefore, all echelons of society will benefit as an atmosphere of mutual prosperity develops between producers and consumers. Opponents of NAFTA have much to say about the disadvantages of the agreement. They tend to focus on the U.S. For example, McIntosh (2003) exclaims, “NAFTA, a treaty that was sold to U.S. audiences as a job booster, has done exactly what its critics said it would—led to job losses in the United States” (para. 6). Unfortunately, NAFTA has received mixed reviews since 2003. However, the job situation in America must not overshadow the growth in the other two countries. Furthermore, depending on the job sector, the U.S. has improved jobs creation. U.S. agricultural exports to Canada and Mexico helped to create 243,000 jobs in 2006 (Zahniser and Crago, 2009). This remarkable feat gives NAFTA proponents hope. Moreover, opponents contend that NAFTA is lacking in its ability to realize its goals. From the beginning of its inception, critics have warned that multinational corporations might take power away from citizens and undermine their living standards (Day, 1992). However, this has not happened, especially in Canada where the standard of living is so high. Other critics have warned that NAFTA will upset environmental protections efforts. Some denounce NAFTA for being too narrow. They say that more needed to be done to reduce inequalities between the U.S., Canada, and Mexico before economic integration occurred (McIntosh, 2003). Thus, a final disadvantage of NAFTA is that it does not strictly enforce the improvement of social and economic standards within its participating countries.#p#分页标题#e# There are many challenges to the continued success of NAFTA. After fifteen years, both proponents and opponents agree that NAFTA must be carefully regulated and adjusted according to the changing times. Many people believe that member countries need an even higher form of economic integration, which would require some external tariffs. Therefore, further negotiations would also be necessary. Common external tariffs would decrease administrative costs related to NAFTA’s rules of origin and help participating firms (Zahniser and Crago, 2009). Another challenge deals with the issue of elevating NAFTA’s status to either a customs union or a common market. This action would definitely appeal to laborers as well as environmentalists. Lastly, there is a challenge to avoid political entanglements associated with this treaty. Each country must protect its own governmental interests, while it maintains NAFTA efforts and fosters the success of future alliances between its members or other countries. Conclusion This paper has thoroughly examined Canada’s contributions to NAFTA by focusing on the economy and analyzing the agreement’s strengths and weaknesses, and explaining the challenges that NAFTA members now face. Many feel that Canada is a stronger country because of NAFTA. Due to economic integration, Canada, Mexico, and the United States have witnessed increases in job growth and creations as well as in the standard of living. In particular, Canada has rising employment rates and declining unemployment. These statistics show how NAFTA has ameliorated the North American economy. Despite its critics, NAFTA has made many accomplishments that the whole world has noticed. Consequently, it remains to be a noteworthy political and socioeconomic achievement. Without NAFTA, many of Canada’s economic successes may not have come to fruition. Although this treaty only includes one continent, in the global marketplace there are many of prospects for Canadian businesses and industries. NAFTA helps by giving Canada more exposure to prospective consumers from all over the world. Likewise, it helps to strengthen the Canada-U.S. partnership that is very productive. All in all, Canada’s contribution to NAFTA has been overwhelmingly positive and, as a result, Canada has a better economy. |
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