Continuing a trend since the mid-1980s, Chile has recently implemented a series of simplifications of capital market reforms, including the shift from its foreign exchange margin to a floating system, the removal of most controls on foreign capital, including the one-year reserve requirement, and the reduction and compensatory treatment of capital gains on domestic and foreign investments. (4) Changes in capital controls and exchange rate management have been essential in stimulating Chile`s export-oriented growth. Privatization and deregulation have also overtaken financial services, including telecommunications, energy and a selection of public infrastructure, with Chile also citing Latin America in the sale of state-owned enterprises. Second, a slight shift towards a production-based value-added approach to export promotion may limit long-term economic growth, a point developed by a study by the Inter-American Development Bank (TSA), which argues that the relatively low income growth of commodity-exporting countries is due to this lack of export diversification. Although many Latin American countries have expanded their intra-regional trade, deeper integration with developed economies appears necessary to achieve greater export diversification. Additional ancillary agreements have been adopted to allay concerns about the potential impact of the treaty on the labour market and the environment. Critics feared that U.S. and Canadian companies in Mexico would have generally low wages, which would lead to a shift of production to Mexico and a rapid reduction in manufacturing employment in the United States and Canada. Meanwhile, environmentalists were concerned about the potentially catastrophic effects of rapid industrialization in Mexico, which does not have experience in implementing and enforcing environmental legislation. Possible environmental problems were raised in the North American Environmental Cooperation Agreement (NAAEC), which established the Commission for Environmental Cooperation (CEC) in 1994. The ITC identified the main sectors that would likely benefit most from the free trade agreement, based on quantitative estimates of the likely increase in U.S.
exports and imports for 2016, if tariff reductions are fully felt. The estimated growth sectors of U.S. exports for the most affected sectors are: 1) motor vehicles and transportation equipment (35-215%); 2) textiles, clothing and leather goods (29%-101%) 3) Coal, oil, gas and other minerals (26%-72%).