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Tariff & non-tariff barriers

Please provide 800-1,200 words on the following:

1. Define tariff and non-tariff barriers

2. Analyze tariff and non-tariff barriers

3. Explain how tariff and non-tariff barriers are used in global financing operations

4. Describe the importance of tariff and non-tariff barriers

Solution Preview

Please provide 800-1,200 words on the following:

1. Define tariff and non-tariff barriers
Tariff barrier is a duty imposed on goods when they move to another country. On the other hand a non-tariff barrier is a trade barrier that reduces imports but is not in the form of a duty.

2. Analyze tariff and non-tariff barriers
There are several types of tariffs imposed and are sometimes related to some cause. A protective tariff is imposed to increase the price of imported goods so that domestic industries are protected. Similarly, a prohibitive tariff is one that is so high that the particular item is not imported. Overall, protective barriers are the most common types of barriers. Other types of tariff barriers include barriers set to restrict imports from countries that have a poor record of environmental protection. This is an environmental tariff. There can be a tariff set to increase the overall income of the government. This is a revenue tariff. This is not common now. The method of setting the tariff also varies across countries. For instance, if the duty is calculated on the value of the goods, it is called ad valorem tariff and if the duty is fixed for a particular goods irrespective of its price, it is called specific tariff.
There is a large variety of non-tariff barriers and most countries use one type or other of the non-tariff barriers. The country may promote buy national policy; this reduces the sales of imported goods. The country may overvalue its currency restricting imports. The government may issue import licenses and only those persons that have licenses are able to import goods. The government may keep requirements for the import of goods like the certificate of origin, or other certificates that ...

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