Non-tariff barriers to trade NTBs or sometimes called " Non-Tariff Measures NTMs " are trade barriers that restrict imports or exports of goods or services through mechanisms other than the simple imposition of tariffs. They may take the form of import quotas, subsidies, customs delays, technical barriers, or other systems preventing or impeding trade. Purposes, Examples, and Consequences.
There are several different variants of division of non-tariff barriers. Some scholars divide between internal taxes, administrative barriers, health and sanitary regulations and government procurement policies. Others divide non-tariff barriers into more categories such as specific limitations on trade, customs and administrative entry procedures, standards, government participation in trade, charges on import, and other categories. The first category includes methods to directly import restrictions for protection of certain sectors of national industries: Under second category follow methods foreign trade policy issued by the national weather are not directly aimed at restricting foreign trade and more related to the administrative bureaucracy, whose actions, however, restrict trade, for example: The third category consists of methods that are not directly aimed at restricting the import or promoting the export, but the effects of which often lead to this result.
The non-tariff barriers can include wide variety of restrictions to trade. Here are some example of the popular NTBs. The most common instruments of direct regulation of imports and sometimes export are licenses and quotas. Almost all industrialized countries apply these non-tariff methods.
The license system requires that a state through specially authorized office issues permits for foreign trade transactions of import and export commodities included in the lists of licensed merchandises.
Product licensing can take many forms and procedures. The main types of licenses are general license that permits unrestricted importation or exportation of goods included in the lists for a certain period of time; and one-time license for a certain product importer foreign trade policy issued by the national weather to import or export. One-time license indicates a quantity of goods, its cost, its country of origin or destinationand in some cases also customs point through which import or export of goods should be carried out.
The use of licensing systems as an instrument for foreign trade regulation is based on a number of international level standards agreements. Licensing of foreign trade is closely related to quantitative restrictions — quotas - on imports and exports of certain goods.
A quota is a limitation in value or in physical terms, imposed on import and export of certain goods for a certain period of time. This category includes global quotas in respect to specific countries, seasonal quotas, and so-called "voluntary" export restraints.
Quantitative controls on foreign trade transactions carried out through one-time license. Quantitative restriction on imports and exports is a direct administrative form of government regulation of foreign trade. Licenses and quotas limit the foreign trade policy issued by the national weather of enterprises with a regard to entering foreign markets, narrowing the range of countries, which may be entered into transaction for certain commodities, regulate the number and range of goods permitted for import and export.
However, the system of licensing and quota imports and exports, establishing firm control over foreign trade in certain goods, in many cases turns out to be more flexible and effective than economic instruments of foreign trade regulation. This can be explained by the fact, that licensing and quota systems are an important instrument of trade regulation of the vast majority of the world.
An import quota can be unilateral, levied by the country without negotiations foreign trade policy issued by the national weather exporting country, and bilateral or multilateral, when it is imposed after negotiations and agreement with exporting country.
An export quota is a restricted amount of goods that can leave the country. There are different reasons for imposing of export quota by the country, which can be the guarantee of the supply of the products that are in shortage in the domestic market, manipulation of the prices on the international level, and the control of goods strategically important for the country.
In some cases, the importing countries request exporting countries to impose voluntary export restraints. In the past decade, [ when? The specifics of these types of restrictions is the establishment of unconventional techniques when the trade barriers of importing country, are introduced at the border of the exporting and not importing country.
Thus, the agreement on "voluntary" export restraints is imposed on the exporter under the threat of sanctions to limit the export of certain goods in the importing country.
Similarly, the establishment of minimum import prices should be strictly observed by the exporting firms in contracts with the importers of the country that has set such prices.
In the case of reduction of export prices below the minimum level, the importing country imposes anti-dumping duty, which could lead to withdrawal from the market. Problems arise when the quotas are distributed between countries because it is necessary to ensure that products from one country are not diverted in violation of quotas set out in second country.
Import quotas are not necessarily designed to protect domestic producers. For example, Japan, maintains quotas on many agricultural products it does not produce. Quotas on imports is a leverage when negotiating the sales of Japanese exports, as well as avoiding excessive dependence on any other country in respect of necessary food, supplies of which may decrease in case of bad weather or political conditions.
Export quotas can be set in order to provide domestic consumers with sufficient stocks of goods at low prices, to prevent the depletion foreign trade policy issued by the national weather natural resources, as well as to increase export prices by restricting supply to foreign markets.
Such restrictions through agreements on various types of goods allow producing countries to use quotas foreign trade policy issued by the national weather such commodities as coffee and oil; as the result, prices for these products increased in importing countries.
Embargo is a specific type of quotas prohibiting the trade. As well as quotas, embargoes may be imposed on imports or exports of particular goods, regardless of destination, in respect of certain goods supplied to specific countries, or in respect of all goods shipped to certain countries. Although the embargo is usually introduced for political purposes, the consequences, in essence, could be economic. Standards take a special place foreign trade policy issued by the national weather non-tariff barriers.
Countries usually impose standards on classification, labeling and testing of products in order to be able to sell domestic products, but also to block sales of products of foreign manufacture. These standards are sometimes entered under the pretext of protecting the safety and health of local populations. Among the methods of non-tariff foreign trade policy issued by the national weather should be mentioned administrative and bureaucratic delays at the entrance, which foreign trade policy issued by the national weather uncertainty and the cost of maintaining inventory.
For example, even though Turkey is in the European Customs Uniontransport of Turkish goods to the European Union is subject to extensive administrative overheads that Turkey estimates cost it three billion euros a year. Another example of foreign trade regulations is import deposits. Import deposits is a form of deposit, which the importer must pay the bank for a definite period of time non-interest bearing deposit in an amount equal to all or part of the cost of imported goods.
At the national level, administrative regulation of capital movements is carried out mainly within a framework of bilateral agreements, which include a clear definition of the legal regime, the procedure for the admission of investments and investors. It is determined by mode fair and equitable, national, most-favored-nationorder of nationalization and foreign trade policy issued by the national weather, transfer profits and capital repatriation and dispute resolution.
Foreign exchange restrictions and foreign exchange controls occupy a special place among the non-tariff regulatory instruments of foreign economic activity. Foreign exchange restrictions constitute the regulation of transactions of residents and nonresidents with currency and other currency values. Also an important part foreign trade policy issued by the national weather the mechanism of control of foreign economic activity is the establishment of the national currency against foreign currencies.
One of the reasons why industrialized countries have moved from tariffs to NTBs is the fact that developed countries have sources of income other than tariffs. Historically, in the formation of nation-states, governments had to get funding. They received it through the introduction of tariffs. This explains the fact that most developing countries still rely on tariffs as a way to finance their spending.
Developed countries can afford not to depend on tariffs, at the same time developing NTBs as a possible way of international foreign trade policy issued by the national weather regulation. The second reason for the transition foreign trade policy issued by the national weather NTBs is that these tariffs can be used to support weak industries or compensation of industries, which have been affected negatively by the reduction of tariffs.
The third reason for the popularity of NTBs is the ability of interest groups to influence the process in the absence of opportunities to obtain government support for the tariffs.
With the exception of export subsidies and quotas, NTBs are most similar to the tariffs. After lowering of tariffs, the principle of protectionism demanded the introduction of new NTBs such as technical barriers to trade TBT.
Increasing consumer demand for safe and environment friendly products also have had their impact on increasing popularity of TBT. NTBs in the field of services have become as important as in the field of usual trade.
Most of the NTB can be defined as protectionist measures, unless they are related to difficulties in the market, such as externalities and information asymmetries between consumers and producers of goods. An example of this is safety standards and labeling requirements.
The need to protect sensitive to import industries, as well as a wide range of trade restrictions, available to the governments of industrialized countries, forcing them to resort to use the NTB, and putting serious obstacles to international trade and world economic growth.
Thus, NTBs can be referred as a new form of protection which has replaced tariffs as an old form of protection. The scarcity of information on non-tariff barriers is a major problem to the competitiveness of developing countries.
As a result, the International Trade Centre conducted national surveys and began publishing a series of technical papers on non-tariff barriers faced in developing countries.
By it launched the NTM Business Surveys website listing non-tariff barriers from company perspectives. From Wikipedia, the free encyclopedia. This article has multiple issues. Please help improve it or discuss these issues on the talk page. Learn how and when to remove these template messages. This article includes a list of referencesrelated reading or external linksbut its sources remain unclear because it lacks inline citations.
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