1. NAFTA Economy Mark Kasoff Three things to know about NAFTA: 1. What it is and is not 2. Size of economy and trade 3. CDA-U.S. Trade

2. North American Free Trade Agreement Successor to 1988 Canada-U.S. Free Trade Agreement (CUSTA). In force since 1994. Removes Most Tariffs (import taxes). Rules of Origin prevent cheating by other countries. Equal Treatment for Direct Investment. Ma Maision est Votre Maison, My House is Your House, Mi Casa es Su Casa Environmental Side Accord Labor Side Accord

3. NAFTA Why Join a Trade Bloc? Everybody Else is Doing It! (EU) Referees Make Better Calls than Players (Trade Dispute Remedies) Don’t Slam that Door! (Assured Access) Bigger Really is Better (Economies of Scale)

4. What NAFTA Doesn’t Do Barriers to Free Movement of People and Goods Remain The Border: Remains a customs checkpoint Agriculture & Textiles: Still subsidized & protected Cultural Industries: “Protected” Energy & Softwood Lumber: Managed via separate accords Trucking: Drivers are restricted Harmonized Standards: Different weights, measures, labeling rules, etc.

5. Share of North American Economy & Population GDP (Gross Domestic Product): Total final output of national economy.

6. Relative Standard of Living GDP per Capita: Total final output of national economy divided by total population.

7. NAFTA and the U.S. (US$ Billions) Exports toImports from $230.6$303.4 $134.2$198.3 Mexico U.S. Canada 2006 U.S. trade with Canada and Mexico set record highs. Since NAFTA, trade between Canada and Mexico has tripled but remains small.

8. Canadian GDP

9. Canada-U.S. Two Way Merchandise Trade That’s no small change! $534 billion/year $1.5 billion/day $1 million/minute Motor Vehicles Oil & Coal Machinery Electronics Plastics

10. Exports to Canada by State (1) (2) (3) (Rank)

11. Oregon-Canada Trade 18% ($2.7 bn) of Oregon exports go to Canada. Canada is Oregon's biggest growth market, in dollar terms. Export shipments to Canada increased $1.3 bn since 2002.