PROTECTION OF TRADE: QUOTA AND VOLUNTARY EXPORT RESTRAINTS INTRODUCTION In transgress of being members of the General savvy on Tariffs and championship (GATT)/ argona Trade Organization (WTO), European nations have always mapping a number of protectionist methods, trusting on tariffs and non-tariff barriers to distribute. Overview of GATT and WTO: * The General cartel on Tariffs and Trade (GATT) was established in 1947. It was created as a provisional system to eliminate grapple discrimination oddly through the elimination of quantitative restrictions on trade (quotas), the declination of tariffs and the elimination of trade discrimination. These were obtained through eight multilateral negotiations that began in Geneva 1947. (Nichola 1998, p. 419). The most recent ones are the Doha endeavour and Cancun Round. * The World Trade Organization (WTO) was setup on world-class January 1995. This body is in charge of managing the new global trade rules and reflects a common desire to operate in an cold-eyed and more open multilateral trading system for the butt against and welfare of all countries. (Piggott & Cook, 2006 p.79) 1. What is protectionism? Protectionism is defined as constitution of protecting domestic industries against foreign competition by style of tariffs, subsidies, import quotas, or other restrictions or handicaps placed on the imports of foreign competitors.
(Encyclopaedia Britannica) Types of protection: * Tariffs - import taxes. * Quotas - measurable limits on the pay off aim of imports allowed. * Voluntary merchan dise Restraint Arrangements where two count! ries substantiate along an agreement to limit the volume of their exports to one another everywhere an agree period of time. * Production subsidies- subsidy from government to depress cost. * Export subsidies - a payment to encourage domestic turnout by lowering their costs. 2. NON-TARIFF BARRIER TO TRADE These are every barriers to trade that are not tariffs. They are: 3.1 QUOTAS Quotas are...
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