ABSTRACT
North American Free Trade Agreement (NAFTA) provides an example of transnational new regionalism, based around trading blocs, with profound implications for economic and social organization. It is a largely neo-liberal variant of new regionalism, with only modest concessions on labour and the environment. Critics decried NAFTA for facilitating the free movement of capital and production to the detriment of labour and the environment. North American integration in labour matters was shaped by the balance of economic power, domestic institutions and social context in which NAFTA and North American Agreement on Labour Cooperation were negotiated. NAFTA was built around asymmetrical bilateral relations of the United States with Canada and Mexico with one dominant partner and two trade-dependent countries, which entered free trade for defensive purposes, to limit harmful unilateral action by their powerful neighbour. The inclusion of the labour and environmental side agreements in NAFTA indicates potential for resolution of North-South divisions on a social dimension to trade pacts.
