Impact of NAFTA on Marketing of U.S. Products

Any attempts to facilitate free trade have a beneficial effect on marketing, particularly in today's global economy. Increasingly, U.S. firms, whether they like it or not, will be forced to become part of world markets. The United States has traditionally been a self-contained, continent-sized market. But a major development in world trade since World War II has been the growth in regional groupings: "The nation state is increasingly a nostalgic fiction" (Ohmae, 1995, p. 12). The best known and most successful regional grouping is the European Community (EC), but it is only one of many. Regional groupings result from agreements between nations in the same region to cooperate in various economic matters.

The major benefit sought through economic integration is faster economic growth. By joining together, member nations can access larger resources, larger markets, and economies of scale: "The trilateral trade area created by NAFTA now stands as the largest free trade market in the world--larger than the European C

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ess, U.S. exporters will reap some benefits in this regard since Mexican tariffs on U.S. products were appreciably higher than U.S. tariffs on Mexican goods. Neither critics nor supporters of NAFTA can uncover radical changes attributed to the passage of the agreement. Granted, some American firms have experienced dramatic increases in sales to Mexico. As a chief executive of one such firm whose Mexican sales have jumped more than 20 percent in the past three years notes, "This cross-border activity is really being driven by Nafta. Without Nafta, we'd still be seeing this . . . on a smaller scale" (Cooper, 1997, p. A20). But overall, trade increases for the United States have not lived up to expectations. After the agreement was passed by Congress, it was common for NAFTA supporters to predict that U.S. exports would rise as much as 30 percent in certain industries, e.g., pharmaceuticals and apparel (Root, 1994, p. 11). Probably the most appreciable marketing impact of NAFTA has been its diversion of trade from Asia to Mexico. By the end of the year, Mexico is predicted to surpass Japan as the second-largest market for U.S. products, the first being Canada. Thus NAFTA will have been instrumental in the reinforcement
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