Trade barriers may be loosely defined as laws, regulations, policies, or practices on the part of a government to either protect domestic PRODUCTs from foreign COMPETITION or artificially stimulate EXPORTING of a particular domestic product. The most straightforward way that this can be done is to institute a duty on the IMPORTS of an item. However, most countries have entered into agreements that limit such activity, and such a direct action can result in a trade war in which other countries place their own duty on imports from the original offending country. To be less obvious and to avoid direct retaliation, countries have invented a vast array of what is referred to as technical trade barriers (or barriers to trade). Countries hope that using technical trade barriers will protect their domestic goods without appearing to directly violate trade agreements and, therefore, precipitate a trade war. Following is a list of some of the technical trade barriers that some countries use.
� Standards, testing labeling and certification. This includes refusing to accept a manufacturers� test or other outside product testing such as the testing done by Underwriters Laboratories. By instituting unjust or unnecessary safety standards, countries hope to limit the imports of foreign goods and to advance domestically manufactured goods.
� Government procurement. This is when a government limits its own purchases to domestically manufactured goods.
� Export subsidies. These can be direct or hidden in the form of preferential financing or agricultural subsidies.
� Lack of INTELLECTUAL PROPERTY protection. This takes such forms as inadequate PATENT, COPYRIGHT, and TRADEMARK protection.
� Services barriers. These impose limits on the range of SERVICES that can be offered by foreign companies. They are most often seen in the financial and banking industries.
� Investment barriers. This is usually seen in limits on foreign ownership of domestic business or limits on transferring earnings and CAPITAL to foreign owners.
� Trade restrictions affecting electronic commerce. This relatively new trade barrier may impose limits on such things as access to the INTERNET or certain Internet sites.
� Toleration of anticompetitive practices. This is seen in the toleration of such practices as BRIBERY, monopolies, CARTELs, etc.
Unfortunately in many cases it is difficult to distinguish between trade barriers and legitimate public-policy actions not motivated by trade protectionism. For example, countries should be able to limit certain types of imports based on safety, environmental, or child labor issues. These issues may not be considered relevant to the exporting country, and thus legitimate concerns get lost in discussions relative to trade barriers. Many countries use environmental and safety concerns as trade barriers. These concerns are especially notable in such organizations as the WORLD TRADE ORGANIZATION. The WTO is a massive trade alliance whose purpose is to advance FREE TRADE among its members. However, often the advancement of free trade and the removal of trade barriers, which are admirable economic objectives, puts the WTO at odds with other admirable goals such as environmental protection and those fighting child labor, who in turn are often rebuffed by countries hiding behind WTO antitrade barrier rules to excuse their inappropriate behavior.
Mack Tennyson