e-mail: david.vanzetti@elspl.com.au website www.elspl.com.au

Vanzetti, D., Hester, S. and Andrews, N. (1992) 'North American Free Trade Agreement: implications for Australian agriculture', Agricultural and Resources Quarterly, 4(3), 355-67.

Under the North American Free Trade Agreement (NAFTA), trade barriers between Canada, the United States and Mexico are to be phased out over a specific period. A static, partial equilibrium model, SWOPSIM, is used to analyse the effects on the US, Mexico and 'Rest of World' region of a removal of  border protection within the NAFTA area. Trade in agricultural products between the United States and Mexico is estimated to increase significantly. It is also estimated that increases in investment and income growth, which would accompany the trade liberalisation, would significantly reduce Mexican exports of live cattle to the United States. There is a small estimated effect on world prices and trade, but the overall impact on Australian agriculture is found to be small.