Which trade framework has governed North American trade in recent decades?

• A. European Union
• B. NAFTA/USMCA
• C. ASEAN
• D. Mercosur

Answer: (B)

North American trade over the past few decades has been shaped by a regional free-trade agreement among Canada, the United States, and Mexico. This framework began with NAFTA in the 1990s to reduce tariffs and align trade rules, and it continued with the update to USMCA in 2020, which kept those regional protections while adding modern provisions on digital trade, labor, environmental standards, and auto manufacturing. Because these agreements specifically coordinate North American trade, they are the framework that has governed economic exchange in this region for many years. By contrast, the European Union governs Europe, ASEAN covers Southeast Asia, and Mercosur covers parts of South America, so they do not suit the North American context.