Forces and Factors Shaping North American Economic Integration

There are eight forces and factors that are interactively shaping North American economic integration; and all of these, to greater and lesser degrees, will determine the future success and sustainability of a fully implemented nafta. Given the symbiotic relationship between Canada, the us, and Mexico, macroeconomic factors will have a significant impact at both the regional and global levels. Policy stimuli, exchange rate developments, the ability to harness the gains from global trade, and ongoing developments in business regulation and corporate reorganization will pose daunting challenges within and among the nafta partners. Increasing competition from Asia, migratory pressures, and the factors of technological capacity and workforce skill levels will confront government, business, and labor with difficult choices. Nevertheless, despite the numerous vulnerabilities that nafta members share—such as weak infrastructure in Mexico, high taxes and labor costs in Canada, and huge fiscal deficits in the us—all three nations possess specific competitiveness strengths and corporate cultures that recognize and respond to the promise of broader and deeper regional economic integration.