Trade protectionism put to the test essay

Protectionism Protectionism represents any attempt that imposes restrictions on trade in goods and services. It aims at cushioning domestic businesses and industries from overseas competition and prevents the outcome resulting from the inter-play of free market forces of supply and demand to take place.

Trade protectionism put to the test essay

Protectionism Protectionism represents any attempt that imposes restrictions on trade in goods and services. It aims at cushioning domestic businesses and industries from overseas competition and prevents the outcome resulting from the inter-play of free market forces of supply and demand to take place.

Protectionism can come in forms of tariffs, quotas, voluntary export restraint arrangements, intellectual property laws, technical barriers to trade, preferential state procurement policies, export subsidies, domestic subsidies, import licensing, exchange controls, financial protectionism and murky or hidden protectionism.

I think protectionism is justified and would like to throw some light on the countries which flourished from protectionism and those which did not.

Recently the average tariff rates have fallen, as we have come closer to free trade. However, there are still many protectionist measures, with tariffs on specific goods.

These are a few modern day examples of protectionism in the form of short case studies. The reason to this fall ion import tariffs is the closer move to free trade. A solution can be found by understanding the theory of comparative advantage.

WTO has taken a step forward in reducing the tariffs as the move to free trade and globalization has created an impact on the protectionist measures ,it has demised the strength of these measures as a result of this its seen that in most cases the goods are not produced in one country leading to the emergence of global supply chains by importing raw materials and assembled goods.

This case can be further supported and understood with examples of a global supply chain. Apple is designed in California but its built in China and ford cars produce their tyres in Indonesia and their engines are produced in Europe.

Trade protectionism put to the test essay

Case 2 The agricultural industry is facing a problem in spite of the reduction in tariff rates. They say that their aim is to increase prices so that the domestic farmers of Europe can have an increased income.

As a solution to this, an agreement was made in The agreement has reduced the tariffs.

The banana price is is expected to fall up to 11pc after the historic agreement was signed between the European union and 10 Latin American countries which will further ion lead to the end of the banana war which existed for almost 20 years.

The Obama administration is going to fight for their business by ensuring jobs. They are going to use the trade laws to stand up for their workers and address harm to them. This protectionist measure has safe guarded the U.

Trade protectionism put to the test essay

Case 5 Argentina has their food tariffs on products which includes over a dozen of agricultural good under the Common External Tariff CET. The import tariffs of milk powder was increased to 9 percent which gives rise to a fear of the Argentinean farmers having a decrease in their incomes.

Measures have been taken by the authorized committee to restrict imports,customs,tariffs and trade on Argentina milk powder.

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These tariff alterations are initially valid for 90 days and it can be renewed for another two years. These trade restriction actions are expected to protect the jobs of ,00 small scale farmers producing milk in the country.

Escalated tariffs occur when higher tariffs are place on processed food and it creates a disincentive for countries to process and add value to the raw commodity. Extensive barriers on the trade policies in agriculture have been tempered by a variety of preference schemes which gives favorable access to developing countries.

In broad terms there are three types of agricultural protection Firstly, the access to the market is restricted to protect domestic agriculture. Secondly, global prices have been suppressed and domestic consumers may pay a higher price than foreign consumers for the same product.

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This scenario has occurred due to export subsidies which act as financial benefits conferred on exporting firms by the Government in order to encourage exports as opposed to domestic consumption.

Thirdly, Trade distorting payments tied to level of production which is called coupled direct payments is encouraging over production and driving down world prices.

Moreover, Government gives domestic support to the farmers by paying direct subsidies and price supports. Case 7 Anti-dumping is occurring in china due to tariffs on imports of stainless steel tubes from EU and Japan. In this case, countries can justify tariffs on the grounds they are preventing this damaging effect of dumping.

As a solution to this, China has imposed anti-dumping tariff on the imports of stainless steel tubes from the European Union EU and Japan.Essay on Trade Protectionism Put to the Test Words | 8 Pages.

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ESSAYS, term and research papers available for UNLIMITED access. The idea behind trade protectionism as policy is that domestic industry cannot or should not have to compete with imports from foreign producers and that domestic workers’ jobs are at risk when trade is unrestricted.

Most economists, and a large portion of the public would agree when looking at.

Trade protectionism