International Trade Essay Example | Topics and Well Written Essays - 2500 words

International Trade - Essay Example Up course it not new phenomena, instead similar strategies have been pursued by countries from the past few years (1). Countries were taking steps to reduce trade barriers such as tariffs to encourage trade, and opening their markets to the world and gain maximum advantage of it. If we go through the modern history, we can see that there was a shift in world trading system among bilateralism, regionalism and multilateralism. In the late 19th and the early 20th century, there was a dominance of bilateral trading system as the trade agreements were negotiated on a bilateral basis between individual countries. Such activities were initiated by England in the 1860s and 1870s as it pushed its trading partners to sign trade agreements. But, after Second World War, trade at multilateral and regional level was gained importance in place of bilateral system. During the period 1940-1990, multilateral trade system gets importance as more and more nations joined the GATT or its successor, the WT O. But, in contrast post 1990 period once again witnessed the dominance of bilateralism which is dubbed as the failure of WTO negotiations at the 1999 Seattle ministerial conference. In addition, regional trade agreements were also gets importance during the period (2). ... ountervailing duties, taxes, environmental, health and safety certification requirements, duties, anti dumping measures, laws, quotas, customs, and licensees are the main hurdles in the way of international trade. Generally, these trade barriers were necessary for countries to protect domestic producers from foreign competition. But, in modern years, international organisations such as WTO were introduced several measures for improving free trade, and as a result the role played by tariffs in international trade has been declined. World Trade Organisation, which came in place of General Agreement on Tariffs and Trade (GATT) generally, deals with regulation of trade between the participating countries. Countries are using barriers in these days to evade free trade rules framed by international trade agreements such as WTO, North American Free Trade Agreement (NAFTA), or European Union (EU) as they restrict the use of tariffs. Moreover, usage of these barriers in international trade ha s been raised sharply after the WTO rules led to a very significant reduction in tariff use. Sometimes countries voluntarily restrict imports of goods from outside as a safe guarding measure in limiting the competition that domestic industries have to face from the imported goods. Some times it is a retaliation technique for countries in case they think that a trading partner has not played by the rules. Many a time’s governments intervened in international trade to safe guard their national security. Generally, almost all countries arranged their defence system from military attack and they cannot leave it to the private sector as the national security is a public issue. So, this is a major issue for any country, and taken into account whenever it starts trade with other trade barriers