🌍 3.2.1.3 - International Trade and Access To Markets Flashcards
What is an import license?
A license issued by a national government authorising the importation of goods from a specific source
What are import quotas?
A physical limit on the quantity of goods that can be imported into a country
What are subsidies?
Grants or allowances usually awarded to domestic producers to reduce their costs and make them more competitive against imports
What are voluntary export restraints?
A diplomatic strategy offered by the exporting country to appease the importing country and deter it from opposing trade barriers
What are embargoes?
Partial or complete restriction of commerce and trade within a particular country.
Put into practice for political rather than commercial reasons
What are the main barriers to trade?
Import license
Import quotas
Subsidies
Voluntary export restraints
Embargoes
What are trade restrictions?
Other import restrictions may be based on technical or regualtory obstacles such as:
- the quality standards of goods being imported
- how they are produced
WHat is an example of an EU trade restriction?
The import of goods knowingly produced using child labour
WHat is FDI?
Foreign Direct Investment, the amount of capital invested in foreign countries
WHat are the main global causes of FDI?
Natural resources and size of a country’s population/market
WHat is a transition economy?
One that is changing from a centrally planned economy to one driven by market forces
What are some of the top FDI giving countries?
US, UK, Germany, France, Switzerland
What are some of the top FDI receiving countries?
Hong Kong, China, US, UK, Germaby
What are trade relationships?
Alter how and why places trade with each other
What are some examples of trade relationships?
TTP, TTIP,G7, G20, Pacific Alliance
How is China investing in Africa?
Their investing in old copper mines in Zambia and Botswana needed to support the ‘industrail explosion’ in China
How has China’s investment supported African countries?
They have been able to develop infrastructures as well as healthcare and education
What does China rely on African markets for?
A steady flow of natural resources to sustain manufacturing
What does China export to Africa?
Cheap manufactured goods, FDI, much needed infrastructure and billions of dollars
How much of China’s FDI is distributed in Africa?
50%
How are Chinese infrastructure programs exploiting Africa?
They are carried out by the Chinese workers instead of giving local companies and citizens vital opportunity to grow in experience + capital. They bring huge profits to Chinese companies
How has China compromised human rights in Africa?
2011, Human Rights Watch released a scathing review of the treatment of Zambian workers in Chenes-owned copper mines, with unsafe conditions, exploitative hours, and threats to those who posed complaints
What have Chines infrastructure programmes created?
Roads, bridges, railways, schools and hospitals
How is China benifitting politically from Africa?
It is gaining power as Africa carries great diplomatic weight shifting China’s diplomatic inluence away from the US
How has China demonstrated its political power in Africa?
It built its first overseas military base on the coast of Djibouti (less than 10 miles away from US AFRICOM) giving access to the Red Sea and Indian Ocean
How does inequality occur within MERCOSUR?
There are different levels of membership, unlike with EU, NAFTA
What is SDT?
Special and differential treatment
WHy were SDTs set up?
To ensure that protectionist policies wouldn’t exclude many developing countries from trading freely with more developed nations due to tarriffs and quota barriers
What were the aims of introducing SDTs? (3)
- Tackle the structural handicaps that characterise LDCs
- Engage in world trade on a more advantageous level
- Promote faster income growth and development
What are LDCs?
Least Developed Countries, a category created by the UN general assembly
WHat was the view of creating LDCs?
To provide the least developed among developing countries with special support measres to overcome their specific disadvanatges
WHat are the structurak handicaps of LDCs?
- A low level of income
- A concentration on export of primary goods
- Vulnerabilityto export price volatility
Special and differential tratement is an…
…acquired political right
Developing countries should enjoy privileged access to the markets of…
…their trading partners, particularly in developed countries
Developing ocuntries should have the right to restrict imports….
…to a greater degree than developed countries
Developing countries should be allowed flexibility in…
…the application of certain WTO rules, or to postpone the application of rules
What are some of the issues with SDTs?
Not all LDCs are members of the WTO and application can vbe lengthly
LDCs are not fully aware of SDTs and so not make productive use of them
There is no ceoncern among richer nations that markets will be flooded with cheap imports and undermine their own industrial base
Which country is currently the greatest exporter?
China, followed by US and Germany
What is the most exported product?
Oil, followed by cars and processed petroleum oil
Which countries are tehe biggest importers?
US, China, Germany
What is Fair Trade?
A social movement to try and achieve better trading conditions and promote sustainability. Traditionally, products are exported to richer nations from developing ones
What standards does Fair Trade set?
Social, economic and environmental, for both companies and farmers/ workers
What do Fair Trade standards ensure?
- Protection of worker’s rights
- Protection of the environment
- Payment of the Fair Trade
What is the FAir Trade Premium?
An additional price to invest in business or community projects of the community’s choice
How do FAir Trade ensure standards are met?
Independent checks
What do members of the FAir Trade movement advocate?
The payment of higher prices to producers as well as helping them achieve improved social and environmental standards
How are FAir Trade producers organised?
International organisations organise them into co-operatives to combine their produce
How do co-opertaives benifit producers?
It gives them more influence in governing market conditions and the power to negotiate better deals with suppliers or supply direct
What are alternative trading organisations?
Oxfam Trading etc other organisations whtich focus on application of Fair Trade
What is the main goal of Fair Trade?
To achieve better trading conditions and promote sustainability, empowering the poorest people
WHat is the main goal of free trade?
Increase economic growth
What does FAir Trade focus on?
Social, economic and environmental standards, trade among individuals
What does free trade focus on?
Trade policies between countries
Who does FAir Trade primarily benefit?
Farmers, workers, communities in LICs
Who does Free Trade primarily benfit?
powerful businesses
WHat are some of the criticisms of Fair Trade?
Interferes with free market, ineffective, imapct too small scale
What are the major actions of free trade?
Countries lower tariffs, labour and environmental standards
What are the major actions of FAir Trade?
Long term relationships, higher labour and environemental standards
What are the key advocate organisations of free trade?
Worl Bank
IMF
WTO
WHat are the key advocate organisations of FAir Trade?
Cafedirect
Oxfam Trading
World Fair Trade Organisation
What are the benifits of Fair Trade?
- Raises labour and environmental standards
- Forms long term relationships with producers
- Encourgaes community development
- Benefits the poorest people and prevents exploitation
WHat are the issues with FAir Trade?
- Encourages higher prices for consumers
- Interfere with free market
- Inefficient
- Impact is small scale
- People don’t buy as much of a product
What are some of the largest TNCs?
Ford
Vodaphone
Shell
Why do TNCs base their operations in LEDCs?
Production costs are less
Governments want to host TNCs and so offer financial incntives
LEDCs often have fewer environmental restrictions
Why might TNCs base opertaions in MEDCs?
- A place has history of the industry e.g engineering for car companies
- Cheap land in declining areas
- Well-developed transport
- High unemployment, available labour
What are some of the benifits of TNCs to host countries?
EMployment
Improved technology
Infrastructure development
Financial support
Inward Investment
Multiplier effect
What is inward investment?
Local economy is improved withiut using taxpayer’s money
WHat is the multiplier effect?
The local econoomy is boosted by increase personal income generating more ‘buying power’
What are some of the drawback of TNCs in host countries?
Labour force
Foreign decision markers
Profits return to country of origin
Grants given to TNC rather than directly
Health and safety issues
Environmental issues
How do TNCs positively impact developing NEEs?
Provides jobs through manufacturing
Brings financial attention to areas
Contributes to infrastructure development
Investment into the area/ country
How do TNCs negatively impact developing NEEs?
Can negatively impact environment
Can exploit cheap labour
Bad working conditions/ rules
How do TNCs positively impact development in LICs?
Raw materials extracted
Materials needed to fuel factories
Provides income/ economy
Increased infrastructure to transport materials
How do TNCs negatively impact development in LICs?
Can damage environment
Products not available in LICS
Inequality created within HICs
How do TNCs positively impact employment in HICs?
Creates high-paid, high-skilled jobs
Attract other TNCs to area
Attract highly skilled workforce
Enhances reputation
Infrastructure development jobs
How do TNCs negatively impact employment in HICSs?
Loss of lower-skilled jobs
Often employ foreign nationals
Sufficient work not provided
Tax moved elsewhere
How do TNCs positively impact opinions of global sysstems?
TNCs can increase trade between LICs/HICs
Can reduce poverty levels - IMF
Increase infrastructure + jobs
Decreased inequality - World Bank
How do TNCs negatively impact opinions of global systems?
Human rights may be violated (UN)
Environmental damage (Greenpeace)
Tax avoidance (WTO)
How do TNCs positively impact product creation and development?
Creates new jobs indesign
New technology development
Creates jobs in manufacturing
Improved reliability of products
How do TNCs negatively impact product creaion and devlopment?
Can cause increased price
New laws/ regulations needed
More secrecy with workers
Creates social divide
How do TNCs positively impact global inequlity?
Jobs for people in NEEs/ LICs otherwise unemployed
Brings global investments to NEEs
Infrastructure development
Contributes to economies
How do TNCs negatively impact global inequlity?
New products increase inequality
Technology not availiable in LICs
Prices of products can cause inequality
Creates social divide
What are the millenium development goals?
8 goals put in place to be achieved in 2015, replaced by sustaianable development goals, with a deadlines of 2030 for 17 goals
How many millenium development goals were met?
1 out of 8
What is the UNDP?
United Nations Developmetn Programme
What is the role of the UNDP?
Advocates for change and connects countries to knowledge, experience and resources
Helps countries develop strong policies, skills, partnerships and institutions so they can sustain this progress
Create jobs, register votes and put disaster risk reduction plans in place
What is the UNEP?
United NAtions Environmental Programme
What is the role of the UNEP?
Co-ordinating organisations’ environmental activies and assit developing contries in implementing environmentally sound practices and policies. Works with Greenpeace and World Bank/IMF
What is the WWSD?
World Summit on Sustainable Development
What is the role of the WSSD?
An intergovernmental conference on sustainable development focuses on direct action towards meeting difficult challenges, including conserving natural resources
What is the UNFCCC?
United Nations Framework Convention on Climate Change
What is the role of the UNFCCC?
To support the global responses to the threat of climate change
