1.3 Brexit Flashcards
Free Trade Policies
Remove tariffs, quotas and taxes on trade between certain countries, which lowers FDIs fixed costs and encourages globalisation.
Foreign Direct Investment (FDI)
A foreign company/investor investing in business in another country, everyone benefits as the profit helps grow the countries economy and the country/company/investor get the profits.
Free Trade Blocs
An agreement between multiple governments, where barriers to trade are reduced/eliminated
European Union (EU)
Has its own currency and provides funds and freedom of movement for those participating countries.
Free Market Liberalisation
Where trade barriers between different countries are removed and free trade is encouraged.
Privatisation
When a company is no longer involved with the government, once a company is privatised, FDIs can have stakes in their services and infrastructure.
Positives Of A Trade Bloc
Market is bigger - more passengers.
Firms could merge together.
You protect yourselves from other parts of the world.
Negatives Of A Trade Bloc
You lose some sovereignty
Interdependence
Some things will be compromised.
Sovereignty
Protection and legislation laws
Why Don’t Mans Want FDI
Creates competition for domestic companies.
Allows migrants and cultural diversity
Offshoring
Some TNCs build their own production facilities in offshore low-wage economies.
