NAFTA - Managerial Economics Essay Example | Topics and Well Written Essays - 500 words

NAFTA - Managerial Economics - Essay Example In addition to labor concerns, opposition to NAFTA was strong among environmental groups, who contended that the treatys anti-pollution provisions were inadequate. To ease concerns that Mexicos low wage structure would cause U.S. companies to shift production to that country, and to ensure that Mexicos increasing industrialization under the Treaty would not create environmental pollution to a harmful degree, special side agreements were included in NAFTA. Under those agreements, the tri-national grouping agreed to establish appropriate commissions to handle labor and environmental issues. The commissions had the power to impose steep fines against any of the member governments that failed to consistently impose its laws. There have been criticisms regarding NAFTAs implementation of environmental protection provisions. Mexico, together with Canada, has been repeatedly cited for environmental malfeasance. Also, many observers have charged that the three governments have been lax in ensuring environmental safeguards since the agreement went into effect (Wikipedia). The NAFTA members are autonomous states that have yielded some of their sovereignty to establish and effectuate a treaty that would economically benefit some 365 million people in the region, but they have retained their power to determine their principal economic and social policies. In other words, the free trade arrangement does not include a supranational government that would enforce policies from the center. Consequently, each state is free to determine its policies, subject only to agreements it has committed itself to implement. An important consideration in this analysis is the fact that Mexico, unlike the United States (and Australia), is a signatory to the Kyoto Protocol to the United Nations Framework on Climate Change (UNFCCC) which aims to limit greenhouse gas emissions (GHG). The Kyoto protocol is concerned with the reduction of global pollution but requires less