Essay from the year 2006 in the subject Economics - International Economic Relations, grade: 2,0, Tecnológico de Monterrey, course: International Political Economy, language: English, abstract: The North American Free Trade Agreement is an agreement between Mexico, Canada and the USA, which is based on the principles of the European Union. It was established in January 1, 1994 and has the purpose to lower trading barriers as much as possible to reach a more fluent international trade, which means more gains from trade for each of the countries. Even though the three countries are neighbors it is remarkable that two first world countries and the third e.g. second world country, Mexico, are responsive to such a close agreement. One wonders how the interaction between those countries works. Indicators for poverty in Mexico are for example that in 2002 half of the population in Mexico was living in poverty and one fifth in extreme poverty. As we can see by taking a closer look to their GDP as an indicator for their financial and economic situations we recognize large differences between the two richer countries and Mexico, which of course does not belong to the poorest of the poor but still does not take in one of the first places in the world rank. [...]