Mexico Says NAFTA has Harmed Mexico
In some cases, Nafta produced results that were exactly the opposite of what was promised (to Mexico). For instance, domestic industries were dismantled as multinationals imported parts from their own suppliers.
Local farmers were priced out of the market by food imported tariff-free. Many Mexican farmers simply abandoned their land and headed north.
Although one-quarter of Mexicans live in the countryside, they account for 44 percent of the migrants to the United States. The contradictions of Nafta are apparent in Guadalajara and the rich farmland around it.
After Nafta, the new factories imported parts from their global suppliers, wiping out local companies that had sold printed circuit boards or assembled computers under tariff protection, said Kevin P. Gallagher, a Boston University professor who has written about the Guadalajara information technology industry.
Things grew worse when the tech bubble burst, the American economy cooled and the companies moved to China, where they could pay even lower wages. Once China entered the World Trade Organization, Mexico lost much of the edge in exporting to the United States that Nafta had given it. Employment in Guadalajara’s I.T. factories dropped 37 percent in 2001 and continued to slide for two years.
“A new phenomenon has grown up under Nafta — high-productivity poverty,” said Harley Shaiken, chairman of the Center for Latin American Studies at the University of California, Berkeley.
Low wages means low purchasing power. “It is not a successful strategy for globalization,” Mr. Shaiken said.
read more at: http://www.nytimes.com/2009/03/24/business/worldbusiness/24peso.html?partner=rss&emc=rss
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