Mexican Maquiladoras and the North American Free Trade Area

Abstract

The maquiladora program has been in existence for nearly three decades. Understanding the concept of maquiladoras, how they are established, their benefits and harms to the US., Mexico and to other countries and how they are impacted by the Free Trade Agreement between the United States, Canada and Mexico, are of utmost importance to international marketers and policy makers all over the world In this paper, the history, the present state and the future potential of the maquiladora program is discussed and the process of establishing a maguiladora is presented. Maquiladoras influence the process of Mexican-American-Canadian multilaleral invesanent and trade relationshin Even though the North American Free Trade Area (NAFTA) is expected to reduce their importance for American and Canadian companies, we argue here that maquiladoras will remain a significant part of the Mexican manufacturing sector and will continue to attract Pacific and European investments seeking inexpensive labor, oil and other basic resources, god manufacturing environment and significant consumers markets, all in one place. Maquiladuras may indeed change ownership but will remain a significant contributor to the economy of Mexico for years to come.

KEYWORDS:

• Maquiladoras
• Foreign trade zones
• Mexico