non tariff barriers in developing economies
I. INTRODUCTION
Domestic trade happens between two units in one country under the same political governance and directly influencing only one national market. On the other hand international trade happens between two units being under two different political systems, each controlling and caring for its own domestic trade, and directly influences both national markets. Trade between countries increases the variety of goods on local markets, lowers the prices on those products and gives chance for local companies to sell abroad. Those are the positive effects, but still as much as countries do not mind exporting, they do not like importing. Exporting of goods is connected to bigger inflow of money to the country and development of local industries. Imports mean money outflow, bigger variety of products on the market and, as a result, higher competition for domestic companies. It also might lead to a situation, when economical dependence might allow endangering political independence of a country, as it happens, for example, with Russia influencing other governments and their decisions by controlling the prices and flow of oil and gas they sell.
Trade Barriers can be defined as: “Restrictions and obstacles impeding free international exchange of goods and services.”
II. WORLD TRADE ORGANIZATION AND GENERAL AGREEMENT ON TARIFFS AND TRADE
GATT itself is not an organization, but a treaty with the signatories being contracting parties. Its objective is to achieve multipartite and free world-wide system of trading. The four basic principles of GATT are:
1. Member countries will consult each other concerning trade problems.
2. The agreement provides a framework for negotiations and embodies results of negotiations in a legal instrument.
3. Countries should protect domestic industries only through tariffs, when needed and permitted. There should be no other restrictive devices such as quotas prohibiting imports.
4. Trade should be conducted
Domestic trade happens between two units in one country under the same political governance and directly influencing only one national market. On the other hand international trade happens between two units being under two different political systems, each controlling and caring for its own domestic trade, and directly influences both national markets. Trade between countries increases the variety of goods on local markets, lowers the prices on those products and gives chance for local companies to sell abroad. Those are the positive effects, but still as much as countries do not mind exporting, they do not like importing. Exporting of goods is connected to bigger inflow of money to the country and development of local industries. Imports mean money outflow, bigger variety of products on the market and, as a result, higher competition for domestic companies. It also might lead to a situation, when economical dependence might allow endangering political independence of a country, as it happens, for example, with Russia influencing other governments and their decisions by controlling the prices and flow of oil and gas they sell.
Trade Barriers can be defined as: “Restrictions and obstacles impeding free international exchange of goods and services.”
II. WORLD TRADE ORGANIZATION AND GENERAL AGREEMENT ON TARIFFS AND TRADE
GATT itself is not an organization, but a treaty with the signatories being contracting parties. Its objective is to achieve multipartite and free world-wide system of trading. The four basic principles of GATT are:
1. Member countries will consult each other concerning trade problems.
2. The agreement provides a framework for negotiations and embodies results of negotiations in a legal instrument.
3. Countries should protect domestic industries only through tariffs, when needed and permitted. There should be no other restrictive devices such as quotas prohibiting imports.
4. Trade should be conducted
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