Automotive Products Trade Agreement

Automotive Products Trade Agreement

A 1965 treaty between Canada and the United States eliminating tariffs on motor vehicles and auto parts. Almost immediately, the agreement resulted in significantly more automotive trade. Proponents of the treaty (and free trade in general) argue the agreement created thousands of jobs in Canada while eliminating its trade deficit with the United States. Critics, however, point out that Canada's own car companies were entirely replaced by American counterparts. The World Trade Organization declared the agreement illegal in 2001, though by that time it had been largely replaced by NAFTA. It was informally called the Auto Pact and APTA.