Policies designed to limit competition from low cost foreign countries are mistaken. We should not worry about cheap foreign imports. Discuss.

In this assignment I will be answering it in two parts. The first part will be on why the policies are brought about and how they are implemented. In the second part I will discuss whether it is a benefit or not to international trade.

Policies are introduced by governments, and are designed to limit competition from foreign products or services. These are made up of mostly duties, tariffs and quotas designed to limit the amount of foreign products in the domestic market, in addition governments subsidise their own exports in order to give their own industries a boost. An examples of a trade barrier is import tax duties, these are imposed to increase the price of a foreign product so it is priced out of the market as the costs involved are driven up and no longer can it stay competitive in the market, other trade policies are shown below….(short extract)