The World 's Biggest Trader

974 WordsMar 16, 20154 Pages
Introduction Accounting for 20 percent of global imports and exports, the European Union (EU) is the world’s biggest trader. This should not come as a surprise because free trade among its members is one of the founding principles of the EU. With trade policy being in the exclusive jurisdiction of the EU, this creates new market opportunities for European exporters, workers and investors. The creation of this global market also creates the need for the EU to protect the interest of its 28 members from serious injury by resolving trade issues that go far beyond tariffs. The Safeguards Agreement (SG Agreement) sets forth the rules for application of Safeguard measures pursuant to Article XIX of the Global Agreement on Tariffs and Trade (GATT) 1994. These measures are temporary, emergency actions resulting in import restrictions that a country is allowed to impose on a product if imports of that product are or have the potentiality to cause a serious injury to a domestic injury of a directly competitive product. Safeguards are one of three types of contingent trade protection measures, along with anti-dumping and countervailing measures, available to WTO Members. Imagine Company X, who exports sneakers to a country Y. If country X imports sneakers in numbers in such ways that it affects the level of sales for the domestic producer of sneakers in Country Y. Country Y may consider implementing a raise in tariffs on sneakers so that Country Y’s domestic producers may keep
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