The North American Free Trade Agreement
The North American Free Trade Agreement (NAFTA)
was conceived and negotiated during the late 1980s and early
1990s in an era of expanding trade blocs, most notably the
European Union. In North America, NAFTA built on the
1988 Canada-United States Free Trade Agreement.1
NAFTA was pursued in both the United States and Mexico
but was particularly promoted by Mexican President Carlos
Salinas.2 Salinas pursued NAFTA as part of a development
plan that aimed to lift the country into the ranks of the industrialized world by increasing foreign investment and trade.
After suffering economic turmoil during the 1980s, Mexican
policymakers also hoped that NAFTA would create jobs, increase wages, and reduce poverty.
Mexico’s desire to emulate the rapid development of
Spain within the European Common Market also influenced
its decision to join an international trading bloc.3 But since it
was implemented in 1994, assessments of NAFTA’s impact
on the Mexican economy vary. 4
www.bread.org
Andrew Wainer
ation program that would slow immigration. But NAFTA’s
policies reinforced support for large, export-oriented producers at the cost of small farmers, and rural employment continued to diminish. Between 1991 and 2007 Mexico lost 20
percent (2.1 million) of its agricultural jobs. The loss of rural
jobs and the inability to generate income impacted family
farms in particular: non-salaried agricultural family employment declined 58 percent between 1991 and 2007. Many of
these displaced farmers ended up in the United States, sometimes working in U.S. agriculture as field laborers.34
After NAFTA, the operation of the Mexican small family
farm became the vocation of older Mexicans, while youth
migrated to the cities or the United States. Almost a quarter of rural Mexicans ages 15-24 in 1990 had left by 2000.
Throughout 30 years of increasing emigration, the Mexican
government also has done little to slow the exodus. Its leading program for small agricultural producers—PROCAMPO—does not target areas of high migration.35
Although the Mexican government is primarily responsible for addressing the country’s rural poverty, the United
States can provide critical support for programs that address
migration pressures at their source. Because of its potential
for long-term impact, such a strategy requires commensurate, sustained policy attention and resources. Furthermore,
by supporting economic development projects with rural
Mexican organizations, Mexican government agencies—particularly at the local and regional levels—can be drawn into
development projects that reduce migration pressures.
A comprehensive, smallholder-based approach to development would by its very nature generate rural employment.
Without support for Mexico’s small and medium farmers,
the country’s rural economy will continue to be increasingly
Small farmers till their land in preparation for planting maize in the
poor, migrant-sending Mexican state of Oaxaca.
dependent on migration and remittances. While the link
between supporting smallholder farmers and poverty reduction is proven, the next logical step with respect to its impact
on migration pressures is less recognized.36
The Contemporary Mexican Countryside
The village of Avila Camacho, about 200 miles south of El
Paso, Texas, is the perfect site for a Hollywood Western (see
map on page 7). Along the village’s dirt road a cow grazes
in front of abandoned, half-ruined adobe homes. But closer
investigation reveals a less cinematic environment.
Up the hill from the ruined buildings, about 160 farming families struggle to maintain the small-scale agricultural
production—mostly apple orchards—that are the community’s economic mainstay. For decades they’ve been losing
Foreign trade and investment increased under NAFTA
and the pact helped stabilize Mexico’s economy. But growth
has been slow and many analysts state that its benefits are
unevenly distributed among the Mexican population.
NAFTA’s impact on Mexican agriculture is particularly
controversial. While NAFTA accelerated Mexico’s transition to capital-intensive agricultural production and assisted
large-scale, mechanized producers, it didn’t generate sufficient rural employment. Mexico lost 2.1 million agricultural
jobs between 1991 and 2007.
The decline of rural employment and the falling fortunes
of small farmers in Mexico was only partly due to NAFTA’s
removal of agricultural import barriers and the influx of
subsidized U.S. agriculture exports. Also consequential were
Mexico’s domestic policies since the early 1980s that decreased government support for small farmers. Nevertheless,
NAFTA intensified a process that resulted in increased poverty and migration pressures for millions of small Mexican
farmers.5
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