Ethical Issues in International Trade

This assignment delves into the growing ethical concerns surrounding international trade. It examines the United States' current trade practices, particularly its focus on increasing corporate taxes and potential implications for free trade with Canada. The discussion highlights the contrasting perspectives between developed and developing nations, emphasizing the potential consequences of protectionist policies on global economic stability and job creation. The assignment concludes with recommendations for fostering ethical and sustainable international trade practices.

GLOBAL UNETHICAL PRACTICES THAT NEED
POLITICAL ATTENTIONS

Table of Contents
Introduction:...............................................................................................................................3
Discussion:.................................................................................................................................3
Critical analysis:.........................................................................................................................3
Application of ethical theories in that context:..........................................................................5
Conclusions and recommendation:............................................................................................8
Reference list:.............................................................................................................................9

Introduction:
In this post-globalisation era, the increasing level of unethical practices in businesses among
different countries are creating more issues by creating more wealth for the wealthy
countries, whereas, less wealth for poor economic countries. Presently, different developed
countries especially USA develops the trade by bypassing the fair play of conducting
businesses’. After the Second World War, an effective rule was developed for conducting an
ethical business and helps different other countries in conducting their business freely.
However, in the present5 time US president Trump is establishing different policies by
reducing the free trade. Different developed nations are concentrating on their own
profitability rather than concentrating on the development of the nations. However, despite of
the fact, political leaders do not concentrate on the development but they only focus on the
trade development. This study provides a clear overview regarding different unethical
practices and it also describes how political leaders are avoiding this issue and only focuses
on the trade development. For conducting the study, first a brief overview regarding the
ethical issues has been provided and then different types of ethical theory is applied in that
contexts in order to understand the ethical issues with betterment.
Discussion:
Critical analysis:
In the present era, along with the development of time, different developed countries are
facing dog-eat dog world of the compromise along with the opacity. However, developed
nations such as USA are not shifting towards the isolationist nation but they are mainly
associated with following the protectionist’s trade policies before the economic health of
world. It has been observed that trades are mainly reverts the rule book that were established
in 19th century and the present American president Donald Trump is mainly responsible for
this shifts. Donald trump has developed a bargain with the Mexico and Canada for facilitating
a Nafta free trade deal. Along with that, Donald Trump has promised a tariff on every metal
of different countries by 10 and 25% (NAFTA, Trump and Canada: A guide to the trade file
and what it could mean for you, 2018). This situation can create negative impact on different
countries that supplies metal to USA because it increases their export costs and create lesser
level of profitability for the organisation and country that supply material to USA. This
situation has highly affected Canada because they are the country that supplies large amount
of metals. Therefore, charging tax despite of the exemptions can create higher level of impact

on Canada because it can negatively impact different Canadian industries. It has been
observed that Donald Trump is mainly elevating USA above their neighbour’s and mainly
thinks about the profitability of the USA irrespective of the development of global economic
factors (NAFTA, Trump and Canada: A guide to the trade file and what it could mean
for you, 2018).
In the contrary, different developing countries such as India is mainly concentrated on the
development of the country rather than gaining profitability in the organisation. The same
strategy is followed by the president of China for reducing poverty in the country. However,
Donald trump do not have any concentration on the reduction of poverty or development of
the economy, the only thing that are considered by them is the achievement of the
profitability. UK also participates in the dog-eat-dog works for earning more profit in their
country by outdo their rivals along with bringing more profitability by reducing the
outsourcing of different sectors such as service sectors along with the manufacturing sectors.
Though, Britain has not implemented any kind of levy on different foreign country for
importing any goods, however, they have makes decision for increasing employability along
with the profitability to stop different outsourcing. Therefore, it can be said that different
developed countries has taken various types of measures in developing their earning but
none of them has no interest in developing the global economy (Scotti, 2018). Therefore, it
can be said that these countries are avoiding the ethics to follow a free trade policies with
several countries with whom they have a good relationship. However, this scenario is not
applicable in every context because EU is one of the economic fortresses that has maintained
their free trade policies and has not restricted the access of the free trade policies.
For discussing the ethics that were strictly followed in the earlier times and is still following
in different countries, deontological ethical theories can be followed that mainly holds
different types of actions that are rights in a moral ways and mainly follows irrespective of
the consequences. From the ethical theories, it can be said that in the earlier times when the
ethical practices of free trade was implemented especially among different developed
countries such as there were a free trade policy among USA and Canada in the year of 2014
that mainly called as the 1994 agreements or NAFTA and the trade relationship was
implemented irrespective of the point of view that tax involved in trade mainly creates higher
level of earning (NAFTA, Trump and Canada: A guide to the trade file and what it could
mean for you, 2018). However, in the present time, USA has break the ethics with Canada
and other country because they want to reduce the trade related deficit and for this reason,

USA want to increase exports and want to reduce the imports from the Mexican along with
the Canadian organisation. along with that USA has took several steps in making their
country profitable with the help of several ways such as making telecommunication
organisation of USA to operate in the NAFTA countries, creating more contract with the
government of NAFTA countries etcetera. However, USA did not have implemented any
kind of policies regarding the development of the world economy and they only consider the
individual profitability (NAFTA, Trump and Canada: A guide to the trade file and what it
could mean for you, 2018).
Application of ethical theories in that context:
In that consequence, positive and the negative rights theory can be applicable. Here, the
negative rights theory mainly demonstrated that an action is right if it can protect any
individual from harm from other people or government of different countries that mainly
exercising their rights (What are Deontological Ethical Theories? definition and meaning -
Business Jargons, 2018). Therefore, by applying the theory in that consequences, it can be
said that this theory is mainly applicable in the earlier time while free trade policies were
effectively applied among different countries and when different countries carets more
agreement among each other in order to generate an effective profitability by ensuring the
mutual advantages. However, in the present time, USA is developing those policies that
charge a higher level of tax with different countries with which they have a good relationship
(Scotti, 2018). Therefore, this situation mainly harms the other developed countries such as
Canada and Mexico. Moreover, UK is also takes an effective step in reducing their
outsourcing of different sectors. Therefore, it can be said that this new strategy of the UK
government can harm the developing or developed countries to which they mainly outsource
their different sectors. Therefore, according to the theory, this practice can be said as
unethical because the decision of the political leaders in different developed countries mainly
harms other countries with which they currently have an effective agreement. This is because,
as per the theory, it has been observed that the action is only rights in that consequences when
it protects any individual from the harm but in that cases, the action of developed countries is
harming the other countries which is unethical (NAFTA, Trump and Canada: A guide to the
trade file and what it could mean for you, 2018).
In the contrary, the positive rights theory mainly demonstrated the fact that any action of
individual or entity is right if it tends to provide the things to other entity or individual those

are effectively needed by them (What are Deontological Ethical Theories? definition and
meaning - Business Jargons, 2018). In that case, the thing that are needed by every
developing as well as developed countries are the trade related facilities, therefore, if free
trade policy would be continuously maintained among different developed countries, then it
can be said that it is ethical practices which were applicable in the earlier times. On the other
hand, if it has been observed that the need of other entity is not considered and only the
profitability of different nations are considered by the developed nations, then it can be said
to be an unethical practices. After the Second World War, the ethical practices were
implemented by considering an effective bi-lateral trade relationship with the other countries
so that both the countries can achieve advantages. Therefore, it can be said that during that
time, an effective and ethical relationship were established. Among countries but in the
present time, USA has developed the policy that can only profitable for their nation but it can
harm the other countries under the NAFTA trade relationship. USA has developed the policy
to increase the tax on different products such as tax but they have makes it mandatory that the
NAFTA countries need to buy “American products”, which is one of the terrible policies
without considering the benefits of others (NAFTA, Trump and Canada: A guide to the trade
file and what it could mean for you, 2018).
On the other hand, social contract theories are there that mainly demonstrated that people
that in contract with each other need to be abide by every political along with the moral
obligations towards the society (What are Deontological Ethical Theories? definition and
meaning - Business Jargons, 2018). Therefore, as per the theory, it can be said that if there is
not any kind of law or order then it can create unlimited freedom. Therefore, according to the
theory, ethics is following free trade among different countries by following a moral as well
as political overview (Scotti, 2018). Though, this theory may be used in the wrong way which
may create higher level of crime if it is applicable in the inappropriate ways. However, it has
been observed that in that particular case, this ethical theory can helps in understandings the
necessity of free trade so that it can be applicable in the developed countries for developing
benefits for different countries. However, in this era of post globalisations most of the
developed countries are mainly consider their own profitability along with benefits. As a
result, they are thinking about the reduction of the free trade. As USA is one of the strongest
countries among all of the nations so that they are creating pressures on different partnership
countries for providing taxes, they even creating pressure on Canada who is the largest buyer
of products of USA (NAFTA, Trump and Canada: A guide to the trade file and what it could

mean for you, 2018). Therefore, this practice of USA is unethical in nature because they are
not following the ethics that need to be followed to help their partnership countries.
In the contrary according to the social justice theory, any action is considered to be
appropriate as well as right if it shows the fairness in the retributive, distributive along with
the compensatory dimensions of the rewards as well as costs (What are Deontological
Ethical Theories? definition and meaning - Business Jargons, 2018). Among this entire
dimension, distributive dimension clearly shows the fact regarding perceived fairness’s for
the distribution of the social benefits along with the burden among the member of groups.
Therefore, by applying the dimension it can be said that after forming any group, there should
not be any kind of burden among the group member but it has been observed that different
free trade related burden are developing among the team countries of free trade. This is
because UK and USA are creating burdens regarding trade (Scotti, 2018). However, it is seen
that UK was a country that were a member of EU but they have left the EU for gaining more
profitability and developing trade relationship with several developing nations of Asia.
However, after the Brexit, UK has faced inflation and in that consequence for reviving their
economic condition, the country has decided to stop the outsourcing of the service and the
manufacturing sector for gaining more profitability. In the contrary, the case of USA is
completely different; they have restricted the free trade policy among the NAFTA countries
because they want to achieve more profitability (NAFTA, Trump and Canada: A guide to the
trade file and what it could mean for you, 2018). Therefore, this situation creates ethical
issues because the strategy of these strong developed countries are not following fairness’s in
trade. In the contrary, the retributive dimension mainly considers the punishments that are
mainly proportionate to the extent of the crime. However, in that case, developed nations are
not doing any crime, the only thing that they are doing is not following the ethics for
businesses and charge some extra levy that can create restriction in free trade and develop an
ineffective trade related decision that can harm those countries that are doing huge businesses
with the USA, however, for this unethical behaviour of the USA, punishments are not
effective because legally the current level of attitude of the USA cannot be called as the
illegal. There are huge differences in the unethical and the illegal behaviour. In the contrary,
compensatory dimension mainly demonstrated the ways by which people are generally
compensated based on the injuries they have faced. From the case, it is seen that the political
leaders of different developed nations are creating policies for developing their own economy
and they have a lack of focus on the development of the world economy. USA is establishing

the law for increasing the corporate tax by 15 to 20% and for this reason; they have decided
to not provide any kind of compensation because they believe that for gaining more
profitability in the country, it is always necessary in reducing the trade deficit by
implementing an effective level of tax.
Conclusions and recommendation:
From the above discussion, it is clear that ethical issues that in the present time, ethical issues
in trade are continually increasing that can create a constant ethical issue and for the activity
of several developed countries, a long term trade issues can be generated among different
countries. It is seen that USA want to stop free trade for Canada which in turns can generate a
stoppage of the free trade by Canada for different countries that mainly conducts their
business in Canada. These situations can ultimately generate a complete stoppage of the trade
and as a result cost of operation can be increased in the world. For this reason, some smaller
companies especially from the developing countries may face issues in expanding their
business in the overseas countries. Therefore, the situation can ultimately generate the
termination of different organisation and the countries that may suffer are the developing
countries because they may get an economically downturn industries. Moreover, stopping
outsource of the service sectors of the UK in several developed along with the developing
countries can create more loss of jobs. This situation can create an ultimate downturn
condition in the economy of the world. Therefore, it can be said that the currently focuses of
the political leaders of different developed countries can ultimately generate a terrible word
economy. Therefore, for reducing the impact, it is necessary to follow different
recommendations such as:
Developing tax rate by consulting with the member countries is necessary so that certain
implementation of the tax rates cannot create a bad trade relationship. The tax rate needs to
be established in that way so that it cannot destroy the trade relationship with the countries
with which they have a good relationship. Along with that, it is necessary to establish a
constant tax rates for every sector and for every country so that it can reduce the confusion
regarding the trade and create a good bond among different countries. However, there is one
ultimate solution that can reduce at these issues that is implementing free trade among
different set of countries so that mutual benefits of those countries can be secured.

Reference list:
NAFTA, Trump and Canada: A guide to the trade file and what it could mean for you.
(2018). The Globe and Mail. Retrieved 15 March 2018, from
https://www.theglobeandmail.com/news/politics/trump-nafta-canada-mexico-trudeau/
article33715250/
Scotti, M. (2018). A year of Trump: How Canada has been affected by the ‘predictably
unpredictable’ president. Global News. Retrieved 15 March 2018, from
https://globalnews.ca/news/3845581/donald-trump-one-year-later-how-canada-has-been-
affected/
What are Deontological Ethical Theories? definition and meaning - Business Jargons.
(2018). Business Jargons. Retrieved 15 March 2018, from
https://businessjargons.com/deontological-ethical-theories.html