Embassy of the United States

NAFTA brings prosperity Op-Ed by Amb. Antonio O. Garza published in Spanish by Mexican newsgroup "Milenio" January 31, 2008

We all appreciate the fact that the United States and Mexico are linked by much more than economic ties -- we are tied together by our common border and increasingly mixed populations, and a multitude of shared values and interests. However, no shared interest is more important to both countries than providing for the prosperity of our peoples, which is why our two governments are working hard to spur economic growth and ensure that the ensuing benefits are enjoyed by all our citizens. President Bush acknowledged in his State of the Union Address on Monday that the U.S. economy is undergoing a period of uncertainty. But, he affirmed, "In the long run, Americans can be confident about our economic growth." The fundamentals of the U.S. economy remain sound. Our economy has experienced six years of uninterrupted growth, averaging 2.8 percent a year since 2001. Since August 2003, 8.4 million jobs have been created; in 2007 alone, the economy added 1.3 million new jobs. Real after-tax per capita personal income rose by 2.1 per cent over the past 12 months and by 11.7 percent - an average of more than $3,550 per person - since January 2001. Despite all this positive news, recent turbulence in the U.S. real estate market has created uncertainty that could damage business and consumer confidence if left unchecked. We have vigorously addressed this problem: the Federal Reserve cut a key interest rate by 1.25 percentage points; the House approved President Bush's $150 billion stimulus package; and, the President has called on Congress to make earlier enacted tax cuts permanent. Beyond our efforts to keep our domestic economy strong, we are also generating new trade and investment by integrating our markets with those of our hemispheric neighbors via free trade agreements. As President Bush has stated, "Trade brings better jobs and better choices and better prices." These translate into tangible benefits for farmers, workers, entrepreneurs, and consumers across the Americas. NAFTA is the best example of the positive effects of free trade. Since its inception, Mexico has quintupled its exports to the United States. Prosperity has increased and families have unprecedented access to previously unavailable or unaffordable goods and services. For example, according to the UN, chicken consumption in Mexico more than doubled in the last decade. And, according to the World Bank, wages and employment in regions of Mexico with increased trade have risen dramatically since NAFTA. Mexico, Canada and the U.S. are continuously streamlining NAFTA's procedures so more people can take advantage of its opportunities and realize its benefits. NAFTA's success has inspired other free trade agreements (FTAs). Throughout the hemisphere, from the Arctic to the Antarctic, countries are extending the advantages of free trade to their people. Mexico has entered into FTAs with other partners in the region and the European Union. The United States has FTAs with Chile, Central America, the Dominican Republic, and Peru. In the State of the Union address, President Bush urged Congress to approve pending FTAs with Colombia and Panama, saying "We must come together ... and show our neighbors in the region that democracy leads to a better life." Additionally, while immigration reform is sometimes a heated and contentious subject of discussion, it is necessary to address this issue in order to acknowledge that foreign workers are a critical component of our economy. President Bush highlighted this in his State of the Union by recognizing the need to "create a lawful way for foreign workers to come here and support our economy." The vast benefits from free trade cannot be fully realized without public policies that ensure these benefits are shared widely within our societies. Here in Mexico, the Calderon administration is working hard to enact such policies. I am proud that we are working with President Calderon and others across the political spectrum in these efforts in many critical areas such as improving Mexico's infrastructure network, strengthening rule of law, raising farmer productivity, protecting the rights of artists and inventors, promoting business contacts, and expanding access to credit for small businesses. Just as the state of the U.S. economy is important to Mexico, so too it is in the best interests of the United States for the Mexican economy to grow in a way that improves the quality of life of its people. Working together, I know we can bring ever greater prosperity to the people in both of our countries.