1994 - Detail

January 1, 1994 - The North American Free Trade Agreement (NAFTA) goes into effect, creating a free trade zone between Canada, the United States, and Mexico.

There was a desire to combat new trade arrangements around the world (i.e. the European Union) by the three North American countries, so representatives of Canada, Mexico, and the United States began to meet to discuss the possibility of joining in a free trade zone to encompass the entire North American continent. There had been an agreement between the United States and its northern neighbor, the U.S.- Canada Free Trade Agreement, since January 1, 1989. The attempt would be to bring those principles to bear, with the progressive elimination of most tariffs and restrictions on the amount of trade of certain goods, with some exceptions.

It had been a goal of President Ronald Reagan since his first campaign, but while he had been able to achieve this by 1988 with Canada, it had been elusive with Mexico. With the effects of the Latin American debt crises of 1982 still lingering once President George H.W. Bush came into office in 1989, he proposed the same with Mexico, with negotiations beginning in 1990, now including all three nations. They would reach an agreement in principle by December 17, 1992.

Controversy and Ratification

While the idea of free trade had many proponents, it was not an easy sell. Free trade versus no free trade advocates in Canada had been battling in national and provincial elections since the passage of the first United States and Canada agreement. The issue of whether to pass or not also became a big issue in the 1992 Presidential campaign between incumbant President Herbert Walker Bush, Democratic rival Bill Clinton, and third party nominee Ross Perot. Perot had been vibrantly against the bill.

"We have got to stop sending jobs overseas. It's pretty simple: If you're paying $12, $13, $14 an hour for factory workers and you can move your factory South of the border, pay a dollar an hour for labor,...have no health care - that's the most expensive single element in making a car - have no environmental controls, no pollution controls and no retirement, and you don't care about anything but making money, there will be a giant sucking sound going south...when [Mexico's] jobs come up from a dollar an hour to six dollars an hour, and ours go down to six dollars an hour, and then it's leveled again. But in the meantime, you've wrecked the country with these kinds of deals," Ross Perot, 1992 Presidential Debate.

After the Presidential campaign was over, with Bill Clinton winning election, the debate in Congress continued throughout 1993 until the House of Representatives voted 234 to 200 to pass the North American Free Trade Implementation Act on November 17, 1993. It was a bipartisan vote. The Senate agreed on November 20, 1993, 61 to 38. A bipartisan vote as well. President Clinton signed the legislation on December 8, 1993. He had supported NAFTA throughout the 1992 campaign.

Full Text, Preamble and Part One, North American Free Trade Agreement

North American Free Trade Agreement - Preamble

The Government of Canada, the Government of the United Mexican States and the Government of the United States of America, resolved to:

STRENGTHEN the special bonds of friendship and cooperation among their nations;

CONTRIBUTE to the harmonious development and expansion of world trade and provide a catalyst to broader international cooperation;

CREATE an expanded and secure market for the goods and services produced in their territories;

REDUCE distortions to trade;

ESTABLISH clear and mutually advantageous rules governing their trade;

ENSURE a predictable commercial framework for business planning and investment;

BUILD on their respective rights and obligations under the General Agreement on Tariffs and Trade and other multilateral and bilateral instruments of cooperation;

ENHANCE the competitiveness of their firms in global markets;

FOSTER creativity and innovation, and promote trade in goods and services that are the subject of intellectual property rights;

CREATE new employment opportunities and improve working conditions and living standards in their respective territories;

UNDERTAKE each of the preceding in a manner consistent with environmental protection and conservation;

PRESERVE their flexibility to safeguard the public welfare;

PROMOTE sustainable development;

STRENGTHEN the development and enforcement of environmental laws and regulations; and

PROTECT, enhance and enforce basic workers' rights;

HAVE AGREED as follows:

Chapter One: Objectives
Article 101: Establishment of the Free Trade Area
Article 102: Objectives
Article 103: Relation to Other Agreements
Article 104: Relation to Environmental and Conservation Agreements
Article 105: Extent of Obligations
Annex 104.1: Bilateral and Other Environmental and Conservation Agreements
Article 101: Establishment of the Free Trade Area

The Parties to this Agreement, consistent with Article XXIV of the General Agreement on Tariffs and Trade, hereby establish a free trade area.

Article 102: Objectives

1. 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:

(a) eliminate barriers to trade in, and facilitate the cross-border movement of, goods and services between the territories of the Parties;

(b) promote conditions of fair competition in the free trade area;

(c) increase substantially investment opportunities in the territories of the Parties;

(d) provide adequate and effective protection and enforcement of intellectual property rights in each Party's territory;

(e) create effective procedures for the implementation and application of this Agreement, for its joint administration and for the resolution of disputes; and

(f) establish a framework for further trilateral, regional and multilateral cooperation to expand and enhance the benefits of this Agreement.

2. 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.

Article 103: Relation to Other Agreements

1. The Parties affirm their existing rights and obligations with respect to each other under the General Agreement on Tariffs and Trade and other agreements to which such Parties are party.

2. In the event of any inconsistency between this Agreement and such other agreements, this Agreement shall prevail to the extent of the inconsistency, except as otherwise provided in this Agreement.

Article 104: Relation to Environmental and Conservation Agreements

1. In the event of any inconsistency between this Agreement and the specific trade obligations set out in:

(a) the Convention on International Trade in Endangered Species of Wild Fauna and Flora, done at Washington, March 3, 1973, as amended June 22, 1979,

(b) the Montreal Protocol on Substances that Deplete the Ozone Layer, done at Montreal, September 16, 1987, as amended June 29, 1990,

(c) the Basel Convention on the Control of Transboundary Movements of Hazardous Wastes and Their Disposal, done at Basel, March 22, 1989, on its entry into force for Canada, Mexico and the United States, or

(d) the agreements set out in Annex 104.1,

such obligations shall prevail to the extent of the inconsistency, provided that where a Party has a choice among equally effective and reasonably available means of complying with such obligations, the Party chooses the alternative that is the least inconsistent with the other provisions of this Agreement.

2. The Parties may agree in writing to modify Annex 104.1 to include any amendment to an agreement referred to in paragraph 1, and any other environmental or conservation agreement.

Article 105: Extent of Obligations

The Parties shall ensure that all necessary measures are taken in order to give effect to the provisions of this Agreement, including their observance, except as otherwise provided in this Agreement, by state and provincial governments.

Annex 104.1: Bilateral and Other Environmental and Conservation Agreements

1. The Agreement Between the Government of Canada and the Government of the United States of America Concerning the Transboundary Movement of Hazardous Waste, signed at Ottawa, October 28, 1986.

2. The Agreement Between the United States of America and the United Mexican States on Cooperation for the Protection and Improvement of the Environment in the Border Area, signed at La Paz, Baja California Sur, August 14, 1983.

Photo above: Montage of the Third Presidential Debate (Bill Clinton, George Bush, Ross Perot), October 19, 1992, George Bush Presidential Library and Museum, and the NAFTA flag, 2009. Courtesy Wikipedia Commons. Below: Initialing ceremomy in October 1992 with President Bush (standing center), Mexican President Carlos Salinas de Gortari (standing left), and Canadian Prime Minister Brian Mulroney (standing right). Seated were Mexican Secretary of Commerce and Industrial Development Jaime Serra Puche, U.S. Trade Representative Carla Hills, and Canadian Minister of International Trade Michael Wilson, October 1992, George Bush Presidential Library. Courtesy Wikipedia Commons. Info source: https://can-mex-usa-sec.org/, the Secretariat, Canada-Mexico-United States; Office of the United States Trade Representative; en.wikiquote.org; Wikipedia Commons.

History Photo Bomb

President George H.W. Bush, Vice President Dan Quayle and school children in conversation with astronauts at NASA. January 24, 1992. Photo: Photographic Office.

Official Souvenirs
America's Best History

Towers of the World Trade Center. Courtesy National Archives.

Timeline History

Want a copy of the Timeline. Now available in easy to search digital format for your Kindle, Nook, or pdf format. Also comes in paperback, too.

Christopher Columbus, by Ridalfo Ghirlandaio, 1520. New U.S. preserve, Salt River Bay, on land Columbus actually visited dedicated in the Virgin Islands. Courtesy Wikipedia Commons.

ABH Travel Tip

If you've never been there, or it's been awhile since you've taken a trip to Washington, D.C., the nation's capitol is a treat for anyone interested in the USA and its history. From the spectacular museums of the Smithsonian, to the recent addition of the Holocaust museum and the Newseum, too, there's so much to see and do. One of the best new attractions is the World War II Memorial. It will make you wonder what took them so long and just why there was any controversy about adding this museum to the space between the Washington Memorial and the Lincoln Memorial.