Assignment About The International Economics.

Running head: International Economics
International Economics
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International Economics1
What are the outstanding trade problems facing the world economy today?
Free trade is associated with the concept of removing the barriers that are faced by
modern economy. Developing countries has to face highly subsidised US and European
countries. The developing countries may be highly efficient compared to highly subsidised
developed nations but some other kinds of problems in the form of weak government policies
and weak infrastructure is mainly creating a menace. The DOHA round is mainly aimed in
mitigating the problems that are mainly associated with WTO and its agreements. However,
in the DOHA round one of the main problem that has been highlighted is the provision of the
subsidy (Rivoli, 2014). Some of the countries like France and US are highly depending on the
subsidy from the government especially in the agricultural field. Tariffs, Quota and
intellectual properties are one of the main problem that has been faced by modern economies.
Free trade has forced WTO to remove the barriers and it has been seen that with the removal
of barriers the developing countries has got immense help in developing their infrastructure
and through the unhindered export and imports the countries has focussed mainly on the
collection of foreign exchanges through the export and import of the products. Most of the
developing nations are selling agricultural products (Hall, 2015).
Even the developing countries faced problems in exporting the products to the other
countries in earlier days due to the existence of tariffs and quotas in form of product quota.
Tariffs used on them was extra burden on these countries and this tariffs would have
increased the price of exports or terms of trade for developing countries. Getting access to the
markets of EU and US, the developing or less industrialised countries had to depend largely
on the government policies. On the other hand, developed or highly industrialised countries
are having huge amount of money as the government is playing a crucial role there. From the
point of view of global subsidisation, it is highly important for WTO and IMF to reimburse
the policies of international trades with most monetary favours to be channelled towards the
developing nations (Monshipouri et al. 2017). Even some of the factors like competition
policies, investment and production procurement is also hampering the benefits of free trade.
Both the import and export quotas that had been previously established by WTO had
disrupted the domestic economy.
Most of the developing nations had taken the strategy of using local resources as the
developing countries have less access to the foreign reserves. Most of developing countries,
like India, South Africa is being given tough competitions from the developed nations in