By Roger V. Lucy
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21 NAFTA was the first formal arrangement among the three countries and the first trade pact involving industrialized and developing states. The initial overtures for trilateral economic collaboration came from the United States in 1979, most notably from Republican presidential contender 11 12 Donald Barry and Ronald C. Keith Ronald Reagan. Contributing to these initiatives were the oil shocks of the 1970s, which highlighted American dependence on unstable foreign supplies, and weakness in the American economy as shown in persistent balance of payments deficits and slumping productivity.
The Transatlantic Economic Partnership," European Union News, 18 May 1998; "Prime Minister Announces Further Canada-European Union Cooperation," Globe and Mail, 15 July 1998; news release, Prime Minister's Office, 17 December 1998. Part 1 Regionalism, Globalism, and the State This page intentionally left blank 1 A Matter of Synergy: The Role of Regional Agreements in the Multilateral Trading Order Michael Hart The last decade of trade negotiations has considerably enlarged and strengthened the framework of rules governing cross-border business dealings.
The positions of the United States, the leading trade and investment partner for most Latin American countries, and Brazil, which boasts the region's second-largest economy, are pivotal in this process. American decision makers, attracted to the economic gains but pressed by domestic opponents, will likely pursue NAFTA expansion on an incremental basis as political circumstances permit. Should the United States fail to play a leadership role, an increasingly assertive Brazil could become the prime mover in transforming the Southern Cone Common Market (MERCOSUR) into a South American Free Trade Agreement (SAFTA).