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Americas - Institutions
In
January 1994, Mexico joined Canada and the
United States in the North
American Free Trade Agreement (NAFTA), which will phase out all tariffs over
a 15-year period.
The highest starting tariff was 20% and it is being
reduced each year in accordance with the NAFTA program. Since its
implementation in 1994, tariffs have been eliminated on 84.5% of all non-oil
and non-agricultural Mexican exports to the United States and 79% of exports
to Canada. The current duty free temporary import programs were eliminated
as of January 1, 2001 for trade between Mexico, have been United States and
Canada.
Ten years after the implementation of this FTA, in January 2004,
only 1% of products will be subject to tariffs and, after 15 years, there
will be no more tariffs on products traded by the 3 countries.
Under the NAFTA, all non-tariff barriers to agricultural trade between the
United States and Mexico were eliminated. In addition, many tariffs were
eliminated immediately, with others being phased out over periods of 5 to 15
years. This allowed for an orderly adjustment to free trade with Mexico, with
full implementation beginning January 1, 2008.
The agricultural provisions of the U.S.-Canada Free Trade Agreement, in
effect since 1989, were incorporated into the NAFTA. Under these provisions, all
tariffs affecting agricultural trade between the United States and Canada, with
a few exceptions for items covered by tariff-rate quotas, were removed by
January 1, 1998.
Mexico and Canada reached a separate bilateral NAFTA agreement on market
access for agricultural products. The Mexican-Canadian agreement eliminated most
tariffs either immediately or over 5, 10, or 15 years. Tariffs between the two
countries affecting trade in dairy, poultry, eggs, and sugar are maintained.
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