2. Whose interests should be the paramount concern of government trade policy – the interests of producers (businesses and their employees) or those of consumers?
Trade policy is a collection of rules and regulations when pertain to trade. Every nation has some form of trade policy, to help a nation’s international trade run more smoothly by setting clear standards and goals which can be understood by potential partner. Trade policy is a part of import and export taxes, tariffs, inspection regulations and quotas. The purpose of trade policy is to protect their local industries from heavy burden on importers and allowing domestics producers of goods and services to get ahead in the market with lower prices or more availability.
Implementation on trade policy hurts the consumer more than the producers. It is because the consumers need to pay higher prices on the import products due to limits on the competition of foreign countries. Meanwhile, the producers win because they are getting more money for the higher price goods due to foreign competition. Globally, business win because of trade policy which controlled by government and more concerned on producer and not as much for the consumer. By establishing tariffs to protect the competition from foreign country will causes higher prices due to restriction. The importation items have a reverse effect on producing goods efficiently by a domestic business when tariffs are involved. For those countries receiving the importation items much costly compare to the country that exporting the items.
For my point of view, the government should balance the policy on the interest of both businesses and consumers. Due to the economy is changing and the small business is very important for growing sector because it represents growing income for country economy. Thus, it will have an entirely different influence on building policy. Therefore, the government should continue to enforce policies that will protect businesses....
References: Athukorala, Prema-Chandra (2005). Academic Journal article from ASEAN Economic Bulletin, Vol. 22, No. 1. Retrieved from http://www.questia.com/library/1G1-133572618/trade-policy-in-malaysia-liberalization-process#articleDetails
Malaysia and the WTO (2007). Master Builder. Retrieved from http://www.mbam.org.my/mbam/images/@WTO%20%2870-77%29.pdf
Malaysia Competition Comission (2012). Retrieved from http://www.mycc.gov.my/legislation.asp?page=policy
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