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• Case | HBS Case Collection | June 2018 (Revised August 2019)

  Renegotiating NAFTA

  Laura Alfaro, Haviland Sheldahl-Thomason, Sarah Jeong, Laura Alfaro, Haviland Sheldahl-Thomason and Sarah Jeong

  January 1, 2019 marked the 25th anniversary of the North American Free Trade Agreement (NAFTA). Twenty-five years after the landmark trade pact was signed by the United States, Canada, and Mexico, considerable debate surrounded it. Trade and trade agreements were a focal point of the 2016 U.S. presidential election. NAFTA came into effect on January 1, 1994, after being backed by the Republican administration of U.S. President George H. W. Bush and the Democratic administration of U.S. President Bill Clinton during its implementation. It created the largest free trade area in the world at the time. Since implementation, total trade between NAFTA countries grew 280%; in comparison while trade to non-NAFTA partners grew by 195%. Critics of NAFTA claimed that it had contributed to a loss of manufacturing jobs to Mexico, increased inequality in all countries, and undercut environmental laws. Those who supported NAFTA, however, noted that in addition to trade, output, and overall employment, investment among the three nations increased, and productivity also grew. Furthermore, the agreement led to lower prices. By 2018, all countries experienced low unemployment rates. With changes in NAFTA looming, many questioned whether the accord had brought more benefits than costs to its signatories. Could the costs be minimized under a new agreement without reducing the benefits? Did buying local goods help create the most jobs in a country? What was the role of business? Everyone wondered what the potential ramifications of the new NAFTA, or lack of, would be.

  Keywords: Trade; Negotiation; Agreements and Arrangements; Cost vs Benefits;

  Citation:

  Alfaro, Laura, Haviland Sheldahl-Thomason, and Sarah Jeong. "Renegotiating NAFTA." Harvard Business School Case 318-143, June 2018. (Revised August 2019.)  View Details

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• Case | HBS Case Collection | June 2018 (Revised August 2019)

  Renegotiating NAFTA

  Laura Alfaro, Haviland Sheldahl-Thomason, Sarah Jeong, Laura Alfaro, Haviland Sheldahl-Thomason and Sarah Jeong

  January 1, 2019 marked the 25th anniversary of the North American Free Trade Agreement (NAFTA). Twenty-five years after the landmark trade pact was signed by the United States, Canada, and Mexico, considerable debate surrounded it. Trade and trade agreements were a focal point of the 2016 U.S. presidential election. NAFTA came into effect on January 1, 1994, after being backed by the Republican administration of U.S. President George H. W. Bush and the Democratic administration of U.S. President Bill Clinton during its implementation. It created the largest free trade area in the world at the time. Since implementation, total trade between NAFTA countries grew 280%; in comparison while trade to non-NAFTA partners grew by 195%. Critics of NAFTA claimed that it had contributed to a loss of manufacturing jobs to Mexico, increased inequality in all countries, and undercut environmental laws. Those who supported NAFTA, however, noted that in addition to trade, output, and overall employment, investment among the three nations increased, and productivity also grew. Furthermore, the agreement led to lower prices. By 2018, all countries experienced low unemployment rates. With changes in NAFTA looming, many questioned whether the accord had brought more benefits than costs to its signatories. Could the costs be minimized under a new agreement without reducing the benefits? Did buying local goods help create the most jobs in a country? What was the role of business? Everyone wondered what the potential ramifications of the new NAFTA, or lack of, would be.

  Keywords: Trade; Negotiation; Agreements and Arrangements; Cost vs Benefits;

  Citation:

  Alfaro, Laura, Haviland Sheldahl-Thomason, and Sarah Jeong. "Renegotiating NAFTA." Harvard Business School Case 318-143, June 2018. (Revised August 2019.)  View Details

  CiteView DetailsEducatorsPurchase

  Related

• Case | HBS Case Collection | June 2019 (Revised August 2019)

  Malaysia: An 'Asian Tiger' Reawakens

  Richard Vietor

  On May 9, 2018, in an extraordinary upset, Mahathir Mohamad again became Malaysia’s Prime Minister. Najib Razak, who had headed the government since 2009, had been swept up in the 1MDB scandal—perhaps the biggest state-corruption incident in history. Although Malaysia’s growth had remained solid since the financial crisis, the scandal undermined the budget, the country’s debt position, and foreigners’ willingness to invest. What was it in the history, culture, and institutional structure of the country that had allowed 1MDB to happen. And could the 93-year-old Mahathir get the country back on track?

  Keywords: Government and Politics; Crime and Corruption; Financial Crisis; Business and Government Relations; Economy; Leading Change; Malaysia;

  Citation:

  Vietor, Richard. "Malaysia: An 'Asian Tiger' Reawakens." Harvard Business School Case 719-073, June 2019. (Revised August 2019.)  View Details

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