how the Canadian economy is determined by the United States economy
The Canadian economy is determined largely by the United States economy threw the North American Free Trade Agreement (NAFTA) and the Free Trade Agreement (FTA). The North American Free Trade Agreement was an agreement that came into effect on January 1,1995 which involves Mexico, Canada and the United States of America. This agreement is said to produce 1 billion to 3 billion dollar gains in each country. NAFTA ensures that a certain amount of goods produced and traded between the three countries has to have a minimum percentage of its parts produced in North America. The Free Trade agreement is between the United States and Canada. The Free trade agreement came into effect in 1989 even though three fourths of trade between Canada and the United States was already free. This agreement to Canada is huge because it set up a free trade zone between the U.S and Canada, which is the largest free trade zone in the world. The Free Trade agreement is huge to Canada because 20 per cent of Canada's GDP comes from exports to the United States. This agreement eliminated "all trade restrictions such as tariffs, quotas, and non tariff barriers." The Canadian economy gains access to the U.S economy that is ten times its size. While t
he U.S economy will gain the lower-priced Canadian goods. Most recently Wal-Mart has invaded Canada and in a short period of time it has become a very successful chain. Wal-Mart is believed to have some 200 stores in Canada in 1997. Wal-Mart is a highly profitable organization in Canada where it is believed that Wal-Mart will make 125 billion dollars by the year 2000. Wal-Mart a United States corporation has set up camp in Canada and has made Wal-Mart Canada. Wal-Mart Canada has "created numerous Canadian jobs and are supporting Canadian manufactures." With a huge successful United States corporation coming up to Canada it has produced many jobs for Canadians and has made Wal-Mart Canada, which is run by Canadians and staffed with Canadians, a successful business. These two agreements show how much the Canadian economy relies on the United States economy and threw these two agreements the Canadian producers can export and import U.S goods easily and at an affordable and profitable price. In this paper I will show you how the FTA and the NAFTA help the Canadian economy export and import into the U.S economy and will show you how much the Canadian economy needs the American economy to do business. The main advantages of the FTA and the NAFTA are. Canada will gain free trade into the market that it relies on the most the U.S. These agreements are suppose to generate 3 billion dollars of annual gains. Canada will be able to "obtain more total output from its scarce resources." The disappearance of tariffs will increase Canadian imports and exports into and from the U.S. That Canadian unemployment will decrease. That a percentage of parts will have to be made in North America.
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Approximate Word count = 2140
Approximate Pages = 9 (250 words per page double spaced)
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