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Scott Jagow: The free trade agreement, NAFTA, took effect January 1, 1994. But not all the trade barriers between Mexico and the U.S. were dissolved at that time. Mexican sugar farmers, for example, were protected. They were given time to modernize so they could compete with U.S farmers. They were given until the beginning of 2008.
So, are Mexican farmers ready now? From our Americas Desk at WLRN, Dan Grech reports.
Dan Grech: In many parts of Mexico, sugar cane is still harvested the old-fashioned way: with machetes. Meanwhile, U.S. sugar farmers use high-tech machines. That’s helped make American sugar cheaper, despite Mexico’s low labor costs.
Dennis Olson’s an economist at the Institute for Agriculture and Trade Policy in Minnesota. He says Mexico has 160,000 small and medium-sized farmers that may be unable to compete against the U.S.
Dennis Olson: That’s one of the reasons you see these Mexican sugar workers occupying the plant and saying, “We don’t want to lose our jobs when we open the border.”
Olson says history may be repeating itself. After trade barriers were lowered on corn, 1.7 million Mexican farmers abandoned their fields because they were unable to compete.
I’m Dan Grech for Marketplace.