With market forces supporting near-shoring, is NAFTA still necessary?

Much has changed in the business landscape since the North American Free Trade Agreement (NAFTA) was enacted two decades ago. Always controversial, NAFTA has been credited with GDP, trade, and wage growth, but also blamed for shuttered factories and outsourced jobs.

In truth, more jobs moved to China, where affordable labor trumped NAFTA perks. Recently, though, volatile transportation costs, rising wages, and other issues have narrowed the savings gap. Now, U.S. manufacturers planning new operations are looking closer to home, trading off-shoring for near-shoring.

By operating in the same time zone, corporate offices, R&D, and the factory floor can communicate better, innovate faster, and create better products. And contrasted with the bottlenecks and lag times encountered abroad, shipping from Mexico to the states is inexpensive, reliable, fast, and flexible.

NAFTA adds to these inherent benefits with NAFTA Visas for project managers who need to travel back and forth, legal protections against intellectual property theft, tariff-free borders, and guidelines to promote sustainability region-wide.

The U.S. and Mexico are both ready for large-scale economic growth. The cultural affinity we’ve built over twenty years has primed us to create collaborative, integrated, skilled manufacturing partnerships– making NAFTA more valuable now than ever before.