The FTA eliminated many things and one of those things was Tariffs. Under the FTA, one group of tariffs was eliminated on January 2, 1989 another group in 1994 and all the rest of the tariffs were removed in 1999. By eliminating the tariffs the goods that weren"t being traded before between Canada and the U.S are now being traded. The goods that weren"t being trade before between Canada and the U.S were petrochemicals and woven fabrics; these goods were not traded before because there was such a high tariff on them. Since Canada does a lot of exporting of raw material these materials use to have such a high tariff and were not being as traded to their potential now they are being traded frequently to the U.S because of the FTA.

             The FTA has allowed Canada and the U.S to "reduce trade obstacles by standardizing their product standards, testing and approval processes." The FTA now states that Canada can"t restrict oil and natural gas exports to the United States therefore Canada can"t charge Americans higher prices in Canada. The FTA has excluded some industries from the agreement these industries are Agricultural, Cultural Industries, Social Insurance programs and Regional development programs. Since there are so many rules and regulations under the FTA a binational panel will settle the disputes. The panel settles these disputes by determine whether each country"s regulators are applying to their trade laws. Canada or the U.S can end the FTA by giving six months notice. Since U.S exports to Canada only account for a small 1.3 per cent of its GDP and Canadian exports to the U.S account for 20 per cent of its GDP, Canada can"t afford to lose this agreement while the end of this agreement would hardly even effect the U.S.

             The NAFTA set up free trade over North America. Since Canada already had free trade with the U.S the NAFTA set up free trade with Mexico. The NAFTA has been controversial both in Canada and in the U.