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Figure 5.1 Agriculture and income in selected countries, 2000

value added agriculture as percent of GDP

60

Central African Republic

50

Mali

TanzaniaCameroon Uganda

40

Togo Nigeria

Ghana

30

Nicaragua Burkina Faso Guyana

Paraguay India Côte d'Ivoire Bangladesh Pakistan

Guatemala

20

Kenya

Iran Egypt

Indonesia Philippines China

10

0

M a l a y s i a S i n g a p o r e Ecuador Algeria Brazil Thailand H o n g K o n g C h i l e C o s t reece South Korea a R i Peru Uruguay c a S a u d i A r a b i a Venezuela Spain G P o r t u g a l F r a n c e I t a l y J a p a n U n i t e d S t a t e s C a n a d a Kuwait Mexico South Africa

0

2

4

6

8 10 12

log income per capita in dollars (World Bank Atlas method)

y = –55.2Ln(x) + 127.7 t-statistic = –12.55 R2 = 0.71

Note: The sample consists of 76 countries, both early and late growers. Source: World Bank, World Development Indicators (2003).

about 25 percent in 1970 to 5 percent in 2000. Mexico will be following the same path for at least the next two decades. Agricultural production has been increasingly centered on large-scale farms, factory-type livestock lots, and capital-intensive food processing, putting pressure on small- scale farms, particularly on subsistence household farmers in Mexico.

Overview of Agricultural Trade in NAFTA

Trade and Agriculture

Media reports on NAFTA and agriculture tend to highlight the negative:4 small farmers driven from the land, huge income disparities within the

4. See, for example, “Controversial Study Says NAFTA Has Little Direct Impact on Problems of Mexican Agriculture Sector,” SourceMex Economic News, April 14, 2004; “US Consumer Group Report: NAFTA Has Hurt Farm Sector,” Reuters, June 26, 2001; and “Agriculture Can Take No More: Demands Reconsideration of NAFTA,” Corporate Mexico, March 3, 2003.

286

NAFTA REVISITED: ACHIEVEMENTS AND CHALLENGES

Institute for International Economics | www.iie.com

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