Trade Barriers Of International Trade

1659 Words7 Pages
Introduction Trade barriers refer to the measures and policies that public authorities implement with the objective of controlling imports and exports to protect goods and services that are produced locally as well as regulating their quality on the market. They also tend to affect both the free flow of international trade and investments. Consequently, the measures adopted may either take the form of legislation or economic strategies. Examples of economic strategies employed to impose trade barriers include tariffs, customs procedure, quotas, embargos, and technical standards that are set primarily to control the quality of import. As much as trade barriers are imposed to protect the local industries and its products and services within…show more content…
For this reason, specific rules, consideration, and tactics have been placed alongside the economic arguments in knowing whether the pursuit of FTAs should be developed and implemented (World Bank 8). Additionally, the proponents for trade barriers believe that quotas, tariffs and embargos will successfully protect the local industries and products from the unfair competition brought by foreign companies. Furthermore, they admit that once the importation of some foreign superior goods is banned, it will provide a chance for local industries to grow as the level of competition will be minimal. However, this idea can be successful, but not for every country as the policy is not applicable with a developed nation because of high cost of production. In other words, trade barriers tend to offer more harm than good for the less developed nations as they usually have a low capitalism to manage the cost production. To solve this issue, the developing country ought to be in the frontline of eliminating trade barriers to boost its foreign direct investment as well as introduce modern technologies to its economy. This concept relates to Adam Smith’s understanding of international cooperation and trading among the nations, which Smith states that: It is the axiom of every particular master of a domestic, never to try to make at homegrown what it will cost him more to make than to buy. If an overseas country can fund us with a
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