key term - North American Free Trade Agreement (NAFTA)

Definition

NAFTA was a trade agreement between Canada, Mexico, and the United States that aimed to reduce trading costs, increase business investment, and help North America be more competitive in the global marketplace. It was in effect from 1994 until it was replaced by the United States-Mexico-Canada Agreement (USMCA) in 2020.

Related terms

Tariff:

A tax imposed on imported goods and services which is intended to increase the price of foreign products making local products more attractive.

Globalization:

The process by which businesses or other organizations develop international influence or start operating on an international scale, leading to increased interconnectedness.

Trade Barrier: Any regulation or policy that restricts international trade, including tariffs, quotas, and import bans