The United States has pursued several fundamental objectives in pursuing a free trade agreement with Canada and Mexico. This included promoting the following measures: although removing trade barriers is generally a step towards free trade, there are situations where a reduction in a tariff can effectively increase the effective protection rate for a domestic industry. Jacob Viner cites an example: “Suppose there are import duties on both wool and wool, but despite duty no wool is produced at home. The abolition of the obligation of wool on the wool shroud without this being important for wool farming.  Many U.S. companies predict that expansion in the region will be less painful if trade barriers in Asia are removed. However, many admit that the success of navigation by Asian distribution systems will remain difficult. Intellectual property piracy remains an obstacle in many Asian countries, particularly in China. Many leaders believe that the great cultural differences in Asia are the main obstacle to everyone`s trade. There is no doubt that an in-depth knowledge of Asian markets and a good understanding of business habits are a prerequisite for activity in that country. Businesses that take the time to position themselves well will instead benefit from the trade and investment opportunities of the 21st century.
Companies that generate revenue could recruit more labour and perhaps increase dividends paid to shareholders. This money is distributed several times by the economy, as a result of what economists call the multiplier effect of money, which says that for every dollar an individual receives as income, part is spent (i.e. consumption) and part is saved. If individuals save 10 per cent of their income, 90 cents will be spent on each $1 and 10 cent income. The 90 cents that are then spent are paid for another person, and another 90 per cent of them are spent on consumption. This will continue until there is nothing left of the original $1. On January 1, 1989, the United States and Canada implemented the U.S.-Canada Free Trade Agreement. On September 25, 1990, former President Bush informed Congress that the United States and Mexico intended to begin free trade negotiations. On February 5, 1991, the United States, Canada and Mexico issued a joint communiqué formally proposing a North American pact that “unites our three economies in a bold and different way.” Formal NAFTA negotiations began on June 12, 1991 and ended on August 12, 1992. The agreement was ratified on November 18, 1993 by the U.S. House of Representatives and two days later by the Senate. Former President Bush and former Mexican President Salinas have defined a free trade agreement between the United States and Mexico as a process of gradual and comprehensive removal of trade barriers between the United States and Mexico, including the total and phasing out of import duties; Eliminate or remove non-tariff barriers, such as import quotas, licences and technical barriers to trade, as much as possible; The establishment of clear and binding protection of intellectual property rights; Fair and timely settlement procedures and other ways to improve and increase the flow of goods, services and investment between the United States and Mexico.