While the three North American countries, Canada, Mexico, and the United States, together acccount for a large share of TPP GDP and intra-TPP trade, their trade is also already governed by NAFTA. Though NAFTA is a far-reaching and long-standing mega-regional agreement, there is a large unfinished agenda in the integration of the North American economy, a gap which TPP could help fill.
This paper compares TPP and NAFTA as they affect the trade of the NAFTA countries. It will argue that TPP is likely to advance trade of the NAFTA block with the other TPP members, and within the NAFTA block, and make the whole TPP block, including NAFTA, more attractive as an investment destination.
The paper also examines the motivation of NAFTA countries in joining TPP as well as the additionality of market access commitments, followed by an assessment of how the rules negotiated in TPP modify pre-existing NAFTA commitments. Finally, the paper briefly considers how TPP might help promote other crucial interests of the NAFTA countries, including integration in North and South America, and the vitality of the WTO.
About the Authors
Mexico Institute
The Mexico Institute seeks to improve understanding, communication, and cooperation between Mexico and the United States by promoting original research, encouraging public discussion, and proposing policy options for enhancing the bilateral relationship. A binational Advisory Board, chaired by Luis Téllez and Earl Anthony Wayne, oversees the work of the Mexico Institute. Read more
