NAFTA set out separate bilateral undertakings on cross-border
trade in agriculture, one between Canada and Mexico, and the other between
Mexico and the United States. As a general matter, U.S.-Canada FTA provisions
continued to apply on trade with Canada.24 Regarding U.S.-Mexico agriculture
trade, NAFTA eliminated most non-tariff barriers in agricultural trade, either
through their conversion to tariff-rate quotas (TRQ’s)25 or ordinary tariffs. Tariffs
were phased out over a period of 15 years with sensitive products such as sugar
and corn receiving the longest phase-out periods. Approximately one-half of
U.S.-Mexico agricultural trade became duty-free when the agreement went into
effect. Prior to NAFTA, most tariffs, on average, in agricultural trade between the
United States and Mexico were fairly low though some U.S. exports to Mexico
faced tariffs as high as 12%. However, approximately one-fourth of U.S.
agricultural exports to Mexico (by value) were subjected to restrictive import
licensing requirements.