Preconditions and Reasons for Mexico’s Joining NAFTA

Abstract

The paper is devoted to identifying the preconditions and reasons for Mexico’s joining the North American Free Trade Agreement (NAFTA). As a result of the research, three groups of factors that influenced that process can be named: economic, internal political and foreign policy.

It is shown that the greatest influence on the signing NAFTA by Mexico had the economic group of factors, among which the main reason was the large-scale neoliberal change in the Mexican economic policy of the 1980s, which essence was in moving away from the long-term protectionist policy. Such a radical change of course in the methods of managing the national economy was caused by the ruinous consequences of the financial and economic crisis of 1982, significant increase of external debt and inflation, a drop during the 1980s in prices of oil, Mexico’s main export commodity, and low level of diversification of Mexican economy. The main reason among the economic factors of Mexico’s joining NAFTA was the gradual transformation of the economy of this country from almost completely closed for foreign investment to one of the most open in the world.

The author has found out that among the internal political factors influenced Mexico’s joining NAFTA, special features of Mexican political system played a major role and were characterized by the actual monopoly of one party power and large amount of president power, and therefore the Mexican political elite had the insignificant degree of dependence on the state of the opinion of the socio-political groups of the population. Such a situation made impossible the emergence of an influential opposition and renouncing the foreign policy and the economic course chosen by the government. Thus, the most influential internal factor that provided the movement of Mexico to NAFTA was the evolution of the outlook of Mexican rulers who, at the end of the 1980s, began to unconditionally adhere to neoliberal economic management principles and believed that joining the process of economic integration in North America was a prerequisite for the dynamic development of Mexico.

It has been established that among the foreign policy components of Mexico’s joining NAFTA the main were the existence of close trade and economic links between Mexico and the United States and their gradual increase during the 1980s. It made Mexico international trade significantly dependent on the northern neighbor and reduced for Mexican leadership the room for maneuver in the foreign policy sphere. The main foreign policy reason that had affected the signing NAFTA by Mexico was the fundamental changing of the international relations system in the late 1980s and early 1990s, in particular the collapse of the socialist camp and the end of the bipolarity period, which made the foreign policy orientation of Mexico on the USA essentially choiceless.