The Rise of Mexican Corn Production in the Face of Cheap...

The Rise of Mexican Corn Production in the Face of Cheap Imports Mexico has completed sweeping changes in its economy and trade relations with the rest of the world. NAFTA is both a symbol and a means to insure the changes remain permanent. Mexico had hoped to generate economic growth through increasing trade with the United States. Economists expect there will be winners and losers when trade develops. Corn producers were expected to be one of the losing sectors. The NAFTA agreement was structured to help phase in the effects, but the sector felt the full pressure of international prices and trade flows very quickly. Despite this, production, as a measure of winners and losers, has increased. Economists also predict that the†¦show more content†¦General data tables in Zahniser and Nadal articles have been sorted by geographic regions as outlined by Chiquiar. Sorting this date by region shows that national aggregate data can sometimes be misleading but is consistent with economist predictions on a regional basis. The north and border regions are closest to the United States and are also most closely affected by NAFTA and respond appropriately. The south region is the least affected and loses the most to corn trade because of pricing without the manufacturing and horticultural gains from trade. This paper is not an argument against free trade. It is widely accepted that free trade should improve consumption and decrease constraints on production. NAFTA Background The North American Free Trade Agreement (NAFTA) is ten years old this year. The agreement was born with controversy. Large blocks of citizens opposed the trade agreement in all three countries. NAFTA was meant to accelerate the lowering of trade restrictions and tariffs. Negotiations between the United States (US) and Mexico leading up to the NAFTA agreement had many areas of special concern. One of these areas was corn production and trade. The Mexican government feared that the sudden opening of their domestic market to competition and international prices would be extremely disruptive. The competitive pressures would displace many small-scale producers. The U.S was concerned aboutShow MoreRelatedEssay Pest Analysis on Nafta2946 Words   |  12 Pagesgross domestic products measuring at 3.6%, growing faster than the United States at 3.3% and Mexico at 2.7%. NAFTA trade now accounts for 30% of all U.S. trade. Introduction The NAFTA secretariat is an organisation compromising of a Canadian, Mexican and a United States section. The North America Free Trade Agreement is an agreement for free trade between the three countries. It became effective in 1994 for 10 years and continues today. 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