JOBS

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Group 8: Đinh Quang Hoan Tống Duy Hưng 3. Huỳnh Lê Ngọc Hằng 4. Nguyễn Thị Kim Hân Unit 10: Jobs

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PROTECTIONISM & FREE TRADE

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- Economic policy of restraining trade through methods such as tariffs on imported goods, quotas and other government regulations designed to discourage imports. 1. Protectionism

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Protectionist policies Tariffs Quotas Anti – dumping legislation

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For example: - Limit imports from foreign countries To protect their industries To prevent foreign take-over of native markets and companies

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2. Free trade Is a system of trade policy that allows traders to act and transact without interference from government

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Some features Trade of goods and services without taxes or other trade barriers - Free access to markets and market information - The free movement of labor and capital between and within countries

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3. Absolute advantage - Refers to the ability of a country to produce more of a good or service than competitors, using the same amount of resources - Attributed to Adam Smith

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In one hour For example:

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4. Comparative advantage - Refers to the ability of a country to produce a particular good or service at a lower opportunity cost than another one - Attributed to David Ricardo

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For example In one hour

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5. Factors of production - Factors of production (or productive inputs) are the resources employed to produce goods and services In general * land * labor * capital goods

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TARIFFS

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To make imports more expensive than home-produces substitutes, and thereby reduce a balance of payment deficit

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Protection against dumping

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To retliate against restrictions imposed by other countries To protect “infant insustries” until they are strong enough to archive economies of scale and strong enough to complete internationally

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QUOTAS Set the limit of imported products

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EFFECT OF QUOTA: -Affect the domestic price -Cause the waste of labourhood -Create exclusive suppliers

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TARIFFS QUOTAS Impossible to know the quantity Limited Quantitiy Provide revenue for the government Provide no revenue for the government

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TARIFFS

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To make imports more expensive than home-produces substitutes, and thereby reduce a balance of payment deficit

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Protection against dumping

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To retliate against restrictions imposed by other countries To protect “infant insustries” until they are strong enough to archive economies of scale and strong enough to complete internationally

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QUOTAS Set the limit of imported products

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EFFECT OF QUOTA: -Affect the domestic price -Cause the waste of labourhood -Create exclusive suppliers

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TARIFFS QUOTAS Impossible to know the quantity Limited Quantitiy Provide revenue for the government Provide no revenue for the government

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NON-TARIFF BARRIER: Non-tariff barriers to trade are official rules or policies, but not a tax, that a government uses to make it difficult for imports of particular goods to come into the country. - Non-tariff barriers that some countries use include so-called safety norm, and the deliberate creation of customs difficulties and delays.

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SAFETY NORM: Norm: A required or agreed standard, amount, maximum, etc. Ex: Safety standards of agricultural products: -Cheese made from pasteurized milk is not more than nine months. -Fat in milk and cream is from 1% to 6%.

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CUSTOMS DIFFICULTIES: difficulties about regulations that collects and protects import-revenues, and regulates the flow of goods in and out of the country. Ex: On customs dossiers:- Currently, the customs procedures for goods exported / imported (if separate types), the company must pay so many papers, documents…

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Non-tariff barriers to trade can be: - Rules of Origin - Packaging conditions - Safety and health regulations - Employment laws - Import licenses - Product standards

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Some examples of non-tariff barriers when importing into Japan: Quality certification mark: beverages, food processing, oil and fat products and some agricultural and forest products and seafood processing. Food hygiene law: related to food, spices, food container, food processing machinery. - Law against infectious diseases: regulation on production such as eggs, milk, honey, meat, fat,…

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-GATT stands for General Agreement on Tariffs and Trade.

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was first signed in 1947. was designed to provide an international forum that encouraged free trade between member states by regulating and reducing tariffs on traded goods and by providing a common mechanism for resolving trade disputes.

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FormationJanuary 1, 1995 HeadquartersCentre William Rappard, Geneva, Switzerland Membership153 memberstates Official languagesEnglish, French, Spanish[1]Director-GeneralPascal Lamy Budget189 million Swiss francs (approx. 182 million USD) in 2009 Staff 625 Website www.wto.int

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The World Trade Organization (WTO) is an international organization designed by its founders to supervise and liberalize international capital trade. The organization officially commenced on January 1, 1995 under the Marrakesh Agreement, replacing the General Agreement on Tariffs and Trade (GATT), which commenced in 1947. The World Trade Organization deals with regulation of trade between participating countries; it provides a framework for negotiating and formalising trade agreements, and a dispute resolution process aimed at enforcing participants' adherence to WTO agreements which are signed by representatives of member governments and ratified by their parliaments.

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GATT is provisional. GATT Agreement has never been ratified by the parliament member of the countries and also has no provision which stipulated the establishment organization. WTO and its agreements are permanent. WTO has a solid legal basis as an international organization, because member countries have ratified the WTO WTO has members (members), only the GATT has Contracting (Contracting parties), that demonstrates GATT is a treaty, not a permanent organization. GATT only adjusted trade in goods, WTO adjust the trade in services and intellectual property. Mechanism of the WTO solves the dispute quickly and are more automatic than those of the GATT

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FAVORABLE: - promising, positive, pleasant SUPERSEDE : - annual, displace, repeal, set aside, substitute, or void by

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Import substitution : government strategy that emphasizes replacement of some agricultural or industrial imports to encourage local production for local consumption, rather than producing for export markets. Import substitutes are meant to generate employment, reduce foreign exchange demand, stimulate innovation, and make the country self-reliant in critical areas such as food, defense, and advanced technology.

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Infant industry : - new industry in its early stages of development, and in need of protection from predatory competition through tariff and non-tariff barriers until it is established.

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Treaty: - formal agreement between countries a peace treaty. -legally binding contract between two or more sovereign states