North American Free Trade Agreement (NAFTA)

Definition

The North American Free Trade Agreement was a treaty entered into by the United States, Canada, and Mexico; it came into force on January 1, 1994, aimed at eliminating most tariffs and barriers to trade and investment among the three countries. Its goal was to encourage economic integration and increase prosperity across North America.

Related terms

Tariff: A tax imposed by a government on imported or exported goods.

Economic Integration: The process by which different countries agree to remove trade barriers between them to enhance economic cooperation and development.

Global Governance: The coordination of international rules, norms, and regulations by international organizations to manage global issues efficiently