Benefits of NAFTA for Canada
NAFTA is the North American Free Trade Agreement existing between three countries, including United States, Canada and Mexico. This agreement has created a significant connection between the involved nations, which has resulted in other advantages. The following article discusses the benefits of NAFTA for Canada.
1. Generates jobs
In all of the nations linked to the NAFTA, it is acknowledged that the living standards have been steadily rising since the agreement came into effect. These improvements in conditions of living are due to the creation of jobs. Businesses have gotten more profits under NAFTA and the healthy competition has led to the creation of jobs in Canada. The enhanced economic activity caused by trade is an advantage as well since the activity assists create jobs. Canada benefits directly from NAFTA because many Canadian jobs are linked to trade.
2. Enhance trade
NAFTA’s main objective is to ease and enhance trade between involved nations. Since this agreement was signed, Canada has experienced huge advantages due the enhanced trade generated. NAFTA benefits Canadians because products manufacture in Mexico can be brought to Canada as well as America duty free, which helps lower costs. Not only has the trade of products in Canada grown due to NAFTA, but Canadians have also benefited from a significant increase of services trade.
3. Increases investment
Another major benefit of NAFTA for Canada is that it enhances investment, especially foreign investment. This is attributed to the protection offered by NAFTA and the reduced risks as well. Foreign investors are basically granted similar protection as domestic or local investors. Canadian firms also benefit from the opportunity of bidding on government contracts in Mexico and America, creating more opportunities.
There are certain shortcomings of NAFTA for Canada as well. This agreement has led to large amounts of poisonous waste being dumped in Canada, which could possibly contaminate drinking water.