I n t e r n a t i o n a l M a r k e t i n g
I n t e r n a t i o n a l M a r k e t i n g
The Dynamic
Environment
of International
Trade
Protectionism
Protectionism
•
Tariffs, quotas, and nontariff barriers are
designed to protect markets from intrusions by
foreign countries
•
Nations utilize barriers to restrain entry of
unwanted goods
– Legal
– Exchange
– Psychological
Protection Logic and Illogic
Protection Logic and Illogic
•
Arguments concerning protectionism on trade
– Protection of infant industry – Protection of the home market – Need to keep money at home
– Encouragement of capital accumulation
– Maintenance of the standard of living and real wages – Conservation of natural resources
– Industrialization of a low-wage nation
Types of Nontariff Barriers
Types of Nontariff Barriers
General Agreement
on Tariffs and Trade
General Agreement
on Tariffs and Trade
•
Paved way for first effective worldwide tariff agreement
•
Basic elements of the GATT
– Trade shall be conducted on a nondiscriminatory basis
– Protection shall be afforded domestic industries through customs tariffs, not through such commercial measures as import quotas
– Consultation shall be the primary method used to solve global trade problems
•
Eliminating international trade barriers – Uruguay
Round
World Trade Organization
World Trade Organization
•
WTO is an institution – not an agreement
– Sets many rules governing trade between its 148 members
– Provides a panel exports to hear and rule on trade disputes between members
– Issues binding decisions
– All member countries will have equal representation
The World Bank Group
The World Bank Group
•
Institution created to reduce poverty and improve
standard of living
– By promoting sustainable growth and investment in people
•
The World Bank has five institutions which
perform the following services:
– Lending money to the governments of developing countries
– Providing assistance to governments for developmental projects to the poorest developing countries
Protests against Global Institutions
Protests against Global Institutions
•
The basic complaint against the WTO, IMF and
others is the amalgam of unintended
consequences of globalizing
– Environmental concerns
– Worker exploitation and domestic job losses
– Cultural extinction
– Higher oil prices
– Diminished sovereignty of nations
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