Coming Together? Mexico-United States Relations

Coming Together? Mexico-United States Relations

Coming Together? Mexico-United States Relations

Coming Together? Mexico-United States Relations

Synopsis

The signing of the North American Free Trade Agreement (NAFTA) was expected to signal the beginning of a new era of close co-operation between Mexico and the United States. Subsequent events, however, have introduced new tensions into the relationship. The 1995 economic collapse in Mexico sharply curtailed economic growth and lowered the demand for U.S. exports. The result has been a substantial deficit in U.S. trade with Mexico and renewed arguments that trade with Mexico reduces the employment opportunities of low-skilled workers in the United States. Immigration, both legal and illegal, has grown as a subject of contention between the two countries. Mexico has also come under increased focus as a conduit for the flow of drugs into the United States. In this book, scholars from the United States and Mexico examine the major elements of the bilateral relationship. The economic dimension is highlighted in two papers that focus on the effects of NAFTA on trade and financial transactions. The political and social dimensions are taken up in three papers on immigration, drug trafficking, and environmental concerns. The contributors include J. Enrique Espinosa and Pedro Noyola, SAI Consultores, Mexico; John Williamson, Institute for International Economics; Juan Carlos Belausteguigoitia, Ministry of the Environment, Mexico; Peter Smith, University of California, San Diego; and George Borjas, Harvard University.

Excerpt

In mid-1997 the Clinton administration must present Congress with a three-year review of the North American Free Trade Agreement (NAFTA). This will reignite the debate on the agreement's benefits that occurred during its negotiation and ratification. the review is coming at a time of increased tensions between the Mexican and U.S. governments--tensions that are likely to contribute to a decline in public support for expanding the economic and social links between the two countries.

The 1995 economic collapse in Mexico complicated the issues. Although not caused by nafta, the sharp recession in Mexico contributed to a surge of illegal immigration into the United States. Contrary to expectations when nafta was approved, the U.S. trade balance with Mexico has slid into substantial deficit--fueling claims that nafta has destroyed jobs and depressed wages in the United States. Furthermore, many politicians blame foreigners for the American drug problem. As a result, Mexico has come under increasing focus as a major conduit for the flow of drugs into the United States.

Unfortunately, debates on Mexico-U.S. issues are often based on misinformation. To contribute to a more balanced and informed debate, the Brookings Institution held a conference on July 25, 1996. the purpose of the conference was to evaluate recent development in the U.S.-Mexico relationship with the participation of researchers from the two countries. Five papers were presented at the conference, each concentrating on a particular subject: bilateral trade flows, movements of financial capital, immigration, drug trafficking, and environmental issues. This book includes revised versions of those papers, together with the remarks of the commentators on each paper and a summary of the discussion that followed. the introductory chapter presents a brief overview of the main issues and summarizes the five chapters and discussion. Because of time constraints, the book was not subjected to the formal review and verification procedures established for research publications at Brookings.

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