Professional Documents
Culture Documents
of international organizations to
minimize such barriers
3 sections
Section 1:
Muhammad Amad
Fahad Jan
Section 2:
Azam Zahid
Section 3:
Shahid Rafiq
Khanzada Muhammad Shakir
Introduction
• Protectionism?
• Protectionism is the policy of protecting
domestic industries against foreign competition
by means of tariffs , subsidies, import quotas, or
other restrictions placed on the imports of foreign
competitors.
• Mankiw, N. Gregory., 2008. Smart Taxes: An Open Invitation to Join the Pigou
Club[Online] (Updated September 14 2009)
http://en.wikipedia.org/wiki/Protectionism#Arguments_for_protectionism
• Lubin, D., 2006. Protectionism (Economics) [Online] (Updated March 22 2007)
http://www.britannica.com/EBchecked/topic/479643/protectionism
PROTECTIONISM
• Protectionism refers to policies or
doctrines which protect businesses
and workers within a country by
restricting or regulating trade with
foreign nations.
ARGUMENTS IN FAVOR OF
PROTECTIONISM
• Protect jobs
• Protect infant industry
• Reduce reliance on imports
• Encourage investments in domestic
industry
• Reduce BoP problems
• Promote exports
PROTECTIONISM (contd)
• In Favor of Protectionism
They raise the price of imported
articles, making them more
expensive and therefore less
attractive than domestic products.
It can also serve as a means of
developing and also improving self-
sufficiency.
• Protection of an infant industry.
E.g., Japanese AC is more expensive than
Pakistani brands.
• National Defense.
E.g., America does not provide Pakistan F22 or
Cruise missile technology to maintain its defense
superiority.
PROTECTIONISM (contd)
• Against Protectionism
It destroys the jobs created in an
economy where there is free trade.
It can make difficulties for
countries who want to specialize in
the production of goods and services.
• Resource Conservation.
The natural resources are depleting globally.
• Decrease in FDI
Barriers repel FDI, because no one would invest
in a strict and uncertain environment. They would
rather go somewhere else to invest.
• Capital Accumulation
Money would only be accumulated in the hands
of the rich/industrialists.
References
• Philip R. Cateora and John L. Graham(2007),
International Marketing 13th edition, pp. 37.
Links:
• http://www.infoplease.com/cig/economics/barrie
• http://www.econlib.org/library/Topics/HighSchoo
• http://news.bbc.co.uk/2/hi/business/533208.stm
General Agreement on Tariffs
and Trade
• The General Agreement on Tariffs and Trade (GATT) was
first signed in 1947 and lasted till 1994
Uruguay September 87 months 123 Tariffs, non-tariff measures, creation of WTO, and extended the
1986 rules, services, intellectual range of trade negotiations,
property, dispute settlement, reductions in tariffs ( 40%) and
textiles, agriculture, WTO agricultural subsidies, allow full
access for textiles & clothing ,
extension of intellectual property
rights.
Doha November ? 141 Tariffs, non-tariff measures, The round is not yet concluded.
agriculture, labor standards,
2001 environment, competition,
investment, transparency, patents
etc
General Agreement on Tariffs and
35
trade
Effects of GAAT
static effects: the shifting of resources from
inefficient to efficient firms as trade barriers fall
-trade creation: production shifts from less
efficient domestic producers to more
efficient regional producers
-trade diversion: trade shifts from more
efficient external sources to less efficient
suppliers within the bloc following the
imposition of common external barriers
dynamic effects: the gains from overall market
growth, the expansion of production, the
realization of greater economies of scale and
scope, and the increasingly competitive nature
of the market
General Agreement on Tariffs and
36
trade
RESEARCH FINDINGS
• Michal Tomz June 14, 2004, Stanford University.
WORLD TRADE ORGANISATION
40
World Trade Organization
(WTO)
• Creation of WTO on 1st of January, 1995 HQ in
Geneva, Switzerland. Presently having 150
member countries, of which around 100 are
developing countries.
• The WTO deals with the rules of trade b/w
member countries.
• WTO agreements set the legal ground rules for
international commerce for member countries.
• Its top level decision making body is Ministerial
conference headed by Director General, and the
body meets at least once every two years.
41
WTO….
It is a place,
47
Technical regulations and
standards
• Technical regulations and industrial standards
are important, but they vary from country to
country. Having too many different standards
makes life difficult for producers and
exporters.
• Standards can become obstacles to trade.
• Technical Barriers to Trade Agreement
(TBT) tries to ensure that regulations,
standards, testing and certification procedures
do not create unnecessary obstacles.
48
Impact of WTO on Pakistan
• In Pakistan, almost every second businessman
appears to be suffering from an unknown fear of the
World Trade Organization. The smaller the trader,
the greater the fear and vice versa.
• WTO dictates the governments on issues such as
food safety, subsidies, health care etc.
• The WTO is essentially designed to protect the vital
interests of the core capitalist states, such as the
US, EU and Japan and not developing economies like
Pakistan.
49
• WTO---unbalanced agreement, favors rich
countries, triad corporations & not small,
comparatively poor ones.
•Sam, Phan Van and Thu, Vo Thanh “Managing the Challenges of WTO Participation”, Case
Study 45, Preparation by Vietnams Banking Sector for WTO Accession, (2003).
•Tsogtbaatar, Damedin “Managing the Challenges of WTO Participation”, CASE STUDY 29,
Mongolia’s WTO Accession: Expectations and Realities of WTO Membership, (2003).
•The General Council “Established Working Parties To Examine, Respectively, The
Membership Applications Of Afghanistan And Iraq”. WTO news: News Items, (13 December
2004).
•Azeem, Syed Book-“Multi National Corporations”, Vol 5, pp. 164-179, 225-260, (2007).
•Azeem, Syed Book- “WTO and Globalization”, Vol 3, pp. 17-35, (2003).
•Das, Bhagrait Lal Book- “What is WTO”, (1998).
•Lanoszka, Anna. "Trade Liberalization, the WTO, and the Environment: Developing
Countries and the Issues of Trade and Development" Paper presented at the annual meeting
of the International Studies Association, Le Centre Sheraton Hotel, Montreal, Quebec, Canada,
Mar 17, 2004 <Not Available>. 2009-05-26.
links
• http://www.profesores.ucv.cl/mberthelo
n/Hoekman%202002.pdf
• http://aic.ucdavis.edu/oa/Smith.pdf
• http://www.globalexchange.org/campaig
ns/wto/update.html
• http://www.wto-pakistan.org
• http://uk.reuters.com/article/idUKN0614
109220100106
• http://www.wto.org/english/thewto_e/ac
c_e/acc_e.htm
links
• http://www.sindhpnd.gov.pk/aboutus/pd
f/wto.pdf
• http://www.3dthree.org/pdf_3D/Guide-
075Ch1.pdf
• http://www.meti.go.jp/english/report/do
wnloadfiles/2004WTO/Overviewe.pdf
• http://www.allacademic.com/meta/p_ml
a_apa_research_citation/0/7/3/3/7/p733
75_index.html