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Showing posts with the label International Trade

Improving Economic Activity Through Tariff Reductions

Trade is at the root of economic development. The easy movement of products and services across borders helps create an interconnected world where opportunities for international goods and companies abound. A paper by Dzerniek-Hanouze & Doherty (2013) discussed the significant advantages that can be found by opening trade routes at a national and regional level to ensure that products and services move smoothly to their destinations.  All trade is based on selling products from one entity to the next. According to Black’s Law Dictionary Trade is ,” The act or business of exchanging commodities by barter; or the business of buying and selling for money; traffic; barter.” A value laden product must transfer hands from one person to the next while a reciprocal value laden item (i.e. money) is exchanged in return.  Before revenue can be earned through the selling of products these products must be available and present for purchase. This means that the product is avail

American Automakers Win WTO Complaints-Are Tariffs a Wise Chinese Policy?

The economy is a hot topic in today’s society as the American economy starts to show signs of sputtering to life. Recently, American automakers won a significant WTO case concerning Chinese tariffs on American-made cars and sport utility vehicles. According to the complaint, tariffs ranged from 2% to 21.5% on large cars starting in 2011 that impacted nearly two-thirds of $8.5 billion worth of U.S. Auto Exports ( 1 , 2 ).   American manufacturers and officials lodged the complaint as an unfair practice within the global economy and sought a level trading field. It is believed that the duties were implemented by China in retaliation for an American 2009 enactment of an anti-dumping duty of up to 35% on imported tires ( 3 ). The WTO also backed the U.S. anti-dumping program due to the unfair practice related to pushing cheap Chinese products on the market. Lower than cost products are viewed as an attempt to game the free market and damage American manufacturing capacity. I