Globalization and Trade Liberalization Flashcards
Trade Liberalization
is the process of achieving free international trade with fewer restrictions such as tariffs
Globalization
is the growing interdependency between nationals that result from increasing free trade and movement of capital between countries
Objectives of CSME
1) Improve SOL at work
2) Full employment of labour and resources
3) Economic development
4) Expansion of trade and Economic relations with developing countries
5) Enhanced levels of international competitiveness
6) Increased production and productivity
7) Movement of labour,capital,goods, services
8) CET
9) Rights if business establishment
10) Common trade policies
11) Harmonization of laws
12) Monetary policy measures
GATT
General aggreement on tariff and trade in 1947
WTO
World Trade Organization
Two main principles of WTO
1) Riaproty- tariff reductions in return for other tariff reductions
2) Most favoured nation rule - a country should apply its lowest tariff to supplier countries of a particular product
Functions of WTO
1) Administering and implementing multi trade agreements
2) Acting as a forum for multi-lateral trade
Impact of Globalization on Consumers
1) Increased Choice
2) Increased Competition
3) Employment
4) Threat to culture
Impact of Globalization on Business
1) Competition
2) Economies of Scale
3) Levels of Technology
4) Ecommerce
5) Linkages
6) Transfer of Knowledge and expertise
Protectionism
Attempt to restrict the importation of goods and services to protect from dumping and unfair comperition, protect interets of local employees, infant industries, correcting BOP
Protectionism Policies
1) tariffs - tax on imports
2) Quotas - placed on the quanitiy that can be imported
3) Embargos - Complete ban on trade between countries
4) Export
5) Exchange controls
