North American Free Trade Agreement

A while ago, I had no idea of what NAFTA meant. I mean, I had heard that word before either on the news or some conversations, however, I never really knew what it was and to be honest, I was too shy to ask because I had heard it so much I was embarrassed. The lesson of the day: seriously, ask all you need, life is about asking, that way when someone asks you, you will know the answer.


NAFTA stands for North American Free Trade Agreement (Tratado de Libre Comercio de América del Norte – TLCAN). One day like today (August 12) in 1992, United States (further on US), Canada and Mexico announced the creation of this trade agreement, after 14 months of negotiations. One year and two months, omg. It was finally signed on December 17th.

Anyway, this agreement created a trade bloc where some barriers to trade and investments between the three countries were eliminated, [1] for example eliminating tariff barriers to agricultural, manufacturing and services, removing investment restrictions and protecting intellectual property rights.

This “trilateral partnership” became the largest free market in the world.[2] It had very good consequences: the combined economies of the three nations at that time measured $6 trillion and directly affected more than 365 million people, it generated economic growth and helped to raise the standard of living for the people in all member countries. It actually set a good example worldwide, because after NAFTA several trade agreements were promoted.

I am so not going to explain every part of the agreement even though I just read most of it. It has 2206 articles and MANY annexes.[3] However, I am going to copy relevant articles and explain each part just to satisfy your curiosity:

Article 102: Objectives

The objectives of this Agreement, as elaborated more specifically through its principles and rules, including national treatment, most-favored-nation treatment, and transparency, are to:

  1. Eliminate barriers to trade in, and facilitate the cross-border movement of, goods and services between the territories of the Parties;
  2. Promote conditions of fair competition in the free trade area;
  3. Increase substantially investment opportunities in the territories of the Parties;
  4. Provide adequate and effective protection and enforcement of intellectual property rights in each Party’s territory;
  5. Create effective procedures for the implementation and application of this Agreement, for its joint administration and for the resolution of disputes; and
  6. Establish a framework for further trilateral, regional and multilateral cooperation to expand and enhance the benefits of this Agreement.
  7. The Parties shall interpret and apply the provisions of this Agreement in the light of its objectives set out in paragraph 1 and in accordance with applicable rules of international law.


NAFTA consists of eight main Parts (each divided into various chapters and sections) which are the following:


General Part >> it includes the objectives of the agreement and general definitions used across the entire document.


Trade in Goods >> it determines the rules to be applied in exchange of goods such as tariff measures, rules of origin, customs procedures and some specialized measures for specific goods (such as petrochemicals).


Technical Barriers to Trade >> it details the standards-related measures for each country that may affect trade in goods or services between them.


Government Procurement


Investments, Services and Related Matters >> Were investments treatment is established as well as cross-border trade in services, telecommunications, financial services and general rules regarding competition policy, monopolies and state enterprises.


Intellectual Property >> it focuses on each country obligation to give adequate and effective protection and enforcement of intellectual property rights, while ensuring that measures to enforce intellectual property rights do not themselves become barriers to legitimate trade.


Administrative and Institutional Provisions >> it deals with publication, notification and administration of laws as well as dispute settlement procedures.


Other Provisions >> such as general exceptions, taxes, cultural industries, etc.

As extra data, NAFTA has two supplements: the North American Agreement on Environmental Cooperation (NAAEC) and the North American Agreement on Labor Cooperation (NAALC).

I seriously hope this was useful. As always I copy the sources of my information. I try to use official pages and reports so that information is concise and true.


[1] Foreign affairs, trade and development Canada. Link:

[2] NAFTA. Inc. Link:

[3]  Foreign Trade Information System. Organization of American States. Link:

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