In the mid-1980s, the 1982 debt crisis brought Mexico`s economy to the brink of collapse, during which the Mexican government was unable to meet its external debt obligations. Much of the government`s efforts to address these economic challenges have been put in place on privatization of public industries and on trade liberalization. Mexico had few opportunities to open up its economy through trade liberalization. In the late 1980s and early 1990s, Mexico implemented a series of economic restructuring measures, which included unilateral trade liberalization, replacing the import substitution policy with others, aimed at attracting foreign investment, reducing trade barriers and making the country competitive in non-exporting oil. In 1986, it joined the General Agreement on Tariffs and Trade (GATT) in order to initiate new trade liberalization measures that resulted in closer relations with the United States. In June 2010, Mexico and Bolivia replaced their existing free trade agreement with a new complementary economic agreement (ACE 66). The agreement allowed the free movement of goods to continue without altering the preferential tariff treatment agreed in the previous free trade agreement. On the other hand, uniform tariffs apply to countries that are not members of a free trade agreement but still trade – trade between China and the United States is a good example. A third-party source sets these rights, usually the World Trade Organization (WTO), and applies on a case-by-case basis.
The free trade agreement between Japan and Mexico was Japan`s first comprehensive agreement with a single country. Signed in 2004 and imposed in 2005, Japan has become, ten years later, Mexico`s fifth largest export destination, with $4.4 billion in exports. The Free Trade Agreement between Japan and Mexico, commonly known as the Economic Partnership Agreement (EPA), has eased tariffs on goods and services. In 2011, the application of lower tariffs on certain agricultural products from Japan and on Mexican imports on auto parts and jet printing paper was revised. The partnership has increased Japanese investment in Mexico through its access to wider markets – the United States.