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North America has consistently economically integrated since the
1980s, when Mexico entered the General Agreement on Tariffs and
Trade and the maquila regime. The integration was boosted with the
entry into force of the North American Free Trade Agreement
(“NAFTA”) in 1994. The NAFTA accelerated the process of
integration by eliminating tariffs for goods originating from North
America, opening the services sector to foreign investment, and
providing businesses with a rules-based system including a binding
dispute settlement mechanism for investor-State disputes. After
over 25 years of operation, the NAFTA needed to be reviewed and
updated to reflect the circumstances of the XXI century, which
resulted in the negotiation of the United States -Mexico-Canada
Agreement and is scheduled to enter into force on July 1,
This integration process has resulted in the creation of value
and supply chains that span the entire North America region.
Businesses have looked for efficiencies within the region and set
up production facilities accordingly. Goods are produced and traded
freely, crossing the border a number of times, gaining value at
each production stage, before finally being offered to final
consumers. The free movement of goods and services is fundamental
for an efficient supply chain, but freedom of movement has been
fundamentally altered by the pandemic.