Trade Terms

Trade

Economic globalisation

T he growing economic interdependence of countries worldwide through increasing volume and variety of cross-border transactions in goods and services, free international capital flows, and more rapid and widespread diffusion of technology.(IMF definition)

Trade liberalisation

Removal of obstacles to free trade, such as quotas, nominal and effective rates of protections and exchange controls.

Privatisation

transfer of ownership of State Owned Enterprises (SOEs) to the private sector

Protectionism

Advocacy of trade barriers such as tariffs and non-tariff barriers such as quotas or health and safety standards to restrict the import of goods and protect domestic producers and workers from competition

Free trade

When the international exchange of goods and services is neither restricted nor encouraged by government-imposed trade barriers

Fair trade

Fair Trade is an alternative approach to conventional international trade. It is a trading partnership, which aims at sustainable development for excluded and disadvantaged producers. It seeks to do this by providing better trading conditions, by awareness raising and by campaigning.

Subsidies

Grants, low-interest loans and other forms of assistance that governments provide to industry – some permissible, some prohibited (by WTO?)

Tariff/ Non-tariff barriers

Customs duty on an imported product at the time of import. Used for reasons of revenue, protection, or to ease/rationalise use of limited foreign exchange

Non-tariff barriers (NTBs) measures other than tariffs used by governments to restrict imported goods, eg variable import levies, import quotas, labelling and package requirements, domestic content requirements.

Tariffs are preferred over NTBs

Market deregulation

The removal of government controls from an industry or sector to allow for a free and efficient market place.

Export promotion

A strategy for economic development that stresses expanding exports, often through policies to assist them such as export subsidies. The rationale is to exploit a country's comparative advantage, especially in the common circumstance where an over-valued currency would otherwise create bias against exports.