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Why do developed countries rely more and more on non-tariff trade barriers? The reasons behind it are beyond your imagination!
With the rapid development of global trade, more and more developed countries have begun to rely on non-tariff trade barriers (NTBs) instead of traditional tariffs to protect their domestic markets. This trend not only reflects changes in global trade policies, but also reveals the complex interactions of economic structures, domestic policies and various interest groups. This article will explore why developed countries choose non-tariff barriers and the impact of these barriers on global trade.
Definition of non-tariff trade barriers
Non-tariff trade barriers refer to trade barriers that restrict the import and export of goods or services through other mechanisms besides tariffs. According to the Southern African Development Community (SADC), non-tariff barriers are “any obstacle to international trade that is not an import or export tariff”. These measures may include import quotas, subsidies, customs delays, technical barriers, etc., often for protectionist reasons.
Developed countries increasingly rely on non-tariff measures
According to reports from the World Trade Organization (WTO), the use of non-tariff trade barriers has increased significantly in recent years. One of the important reasons is that developed countries no longer rely on tariff revenue because their economic sources have been diversified and their fiscal conditions are relatively stable. Therefore, these countries have more flexibility to implement non-tariff measures to protect their domestic markets.
“According to a 2019 United Nations Conference on Trade and Development report, trade costs associated with non-tariff measures are more than double those of traditional tariffs.”
Types of non-tariff barriers
Non-tariff barriers can be divided into several types, including administrative and bureaucratic delays, standards and testing requirements, import quotas, etc. For example, in some cases, countries may require all imported products to meet specific technical standards, often to protect local consumers and the environment. On the surface, these standards may appear to be based on reasonable considerations, but in fact they may become part of a protectionist strategy.
Protectionist effects of non-tariff measures
Many non-tariff measures are considered protectionist. However, this does not mean that all non-tariff barriers are harmful. In some cases, they can be used to protect vulnerable industries in domestic markets and provide the necessary support to overcome competition in the market. With the increasing awareness of environmental protection, more and more consumers are beginning to require products to meet environmental protection standards, which has also promoted the growth of technical trade barriers.
The challenge of managing information scarcity
For developing countries, insufficient management and transparency of non-tariff barriers often become a major challenge in global trade. As a result, the International Trade Center launched a series of investigations and began to publish reports aimed at helping these countries better understand and respond to various non-tariff barriers to improve their competitiveness in global trade.
Future Outlook
As the global economy changes, developed countries' reliance on non-tariff trade barriers is likely to continue to increase. However, as the international trade environment becomes more and more complex, this dependence may also trigger reactions from other countries, resulting in trade frictions and new policy challenges. Therefore, in future trade policies, how to balance the relationship between protectionism and free trade will become an important issue that governments need to face.
In this context, the positive and negative aspects of non-tariff trade barriers will continue to trigger heated discussions. Do you think such trade barriers will bring more benefits or problems to the global economy?
