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1.3 Trade Protectionism

Reasons for Trade Protectionism

In contrast with free trade where government barriers to trade are kept to a minimum degree,trade protectionism is the economic policy of restraining trade between countries through methods such as tariffs on imported goods, restrictive quotas, and a variety of other government regulations designed to allow imports to complete fairly against goods and services produced domestically. Two major purposes are involved in trade protectionism. One is to protect the goods or services produced domestically from the fierce competition by foreign participation.The other is to enhance the competitiveness of the domestic products in the international market by beneficial policies.

The specific reasons for implementing trade protectionism can be summarized as follows:

◆ To keep economic diversity

Many countries are implementing protectionism to keep economic diversity so as to avoid over dependence on other countries both economically and politically.

◆ To protect infant industries

Infant industry refers to emerging domestic industries that should be protected until they become stable and mature. Usually, the infant industry is protected in its early stage of development by the preferential policies issued by the country’s government. The normal method is to limit or ban the foreign participation in the same area. Nowadays, as service trade such as banking and insurance in most developing countries is still in its infancy, the governments are taking measures to prohibit the engagement of foreign enterprises in this area.

◆ To protect the vital and strategic business sectors

The vital and strategic business sectors are closely related to a country’s stability and economic development. For many countries, the important business sectors such as transportation,telecommunications, and steel are all under strict control and protection of government.

◆ To reduce the high pressure of unemployment

Employment is crucial to a country’s stability. Without protection, the flooding in of foreign labor and goods at a low cost will put the workers in certain industries, especially the labor-intensive industry under big pressure of job losses. That’s why most governments are making efforts to protect the domestic labor market and create more job opportunities.

Forms of Trade Protectionism

Varieties of methods are used by different countries to restrain foreign trade, mainly including tariff barriers and non-tariff barriers.

◆ Tariff barriers

Tariff barriers are the main and typical form of protectionism. Typically, tariffs (or taxes) are imposed on imported goods. Tariff rates usually vary according to the type of goods imported.Import tariffs will increase the cost to importers, and increase the price of imported goods in the local markets, thus lowering the quantity of goods imported. Tariffs may also be imposed on exports, and in an economy with floating exchange rates, export tariffs have similar effects as import tariffs. However, since export tariffs are often viewed as a negative impact on local industries, while import tariffs are taken as a positive impact on local industries, export tariffs are seldom implemented. Tariff duties levied for income purpose is known as revenue tariff, while those levied for protection is known as protective tariff. As a penalty measure, countervailing duty is levied against bounty or grant during production, transport and export. Anti-dumping duty is also punitive. It is collected when the importing country holds that there is a dumping.

The import tariff duties are mainly levied in three ways: specific, ad valorem and compound.

◇ Specific duty is levied per physical unit-according to weight, volume, measurement and quantity, etc.

◇ Ad valorem duty is levied according to the value or price of products.

◇ Compound duty is a combination of specific duty and ad valorem. It is collected according to either of the two first, then the other.

◆ Non-tariff barriers

◇ Import quotas

Import quotas are used to reduce the quantity and therefore increase the market price of imported goods. The economic effect of an import quota is similar to that of a tariff, except that the tax revenue gained from a tariff will instead be distributed to those who receive import licenses. There are two types of import quotas: absolute quota and tariff-rate quota. Absolute quota sets a limit on the quantity of imports to a specified level during a period of time specified. Tariff quota sets a limit within which low and no duties are levied,otherwise high duties or penalty will be imposed.

◇ Import license

An import license is a permit for import granted by the government. It can be independent or combined with quotas.

◇ Exchange rate manipulation

A government may intervene in the foreign exchange market to lower the value of its currency by selling its currency in the foreign exchange market. Doing so will raise the cost of imports and lower the cost of exports, leading to an improvement in its trade balance. However, such a policy is only effective in the short run, as it will most likely lead to inflation in the country, which will in turn raise the cost of exports, and reduce the relative price of imports.

◇ Technical standard barriers

As a new hidden method of import control, technical standard barrier is widely used by governments of countries(usually developed ones) to control import through setting technical standards that foreign countries(usually developing ones) are not familiar with or hard to meet.

◇ Green barriers

Green barriers are also a newly used method for import control. With the excuse of protecting environment and the safety of human beings, a series of strict ecological, health and sanitary standards much higher than those in the developing countries are set as the condition for market access by developed countries to protect their domestic market and industries. Green barriers normally take on two forms: green label and green packing.

◇ Direct subsidies

Government subsidies (in the form of lump-sum payments or cheap loans) are sometimes given to local firms that cannot compete well against imports. These subsidies are purported to protect local jobs, and to help local firms adjust to the world markets.

◇ Export subsidies

Export subsidies are often used by governments to increase exports. Export subsidies are the opposite of export tariffs by which exporters are paid a percentage of the value of their exports. Export subsidies increase the amount of trade, and in a country with floating exchange rates, have effects similar to import subsidies.

NOTES

1. rich in some resources but poor in others 某些资源丰富,但其他资源贫乏。注意:① rich和poor后面用介词in;② others此处指other resources。

2. lack在此处是及物动词,和宾语metal reserves之间不用介词。lack用作不及物动词时一般以现在分词形式出现。如,He is lacking in courage. 他缺乏勇气。lack也可用作名词,这时如要表达缺乏的东西,则需在lack后面用介词of。如,Production decreased for lack of raw material. 生产因缺乏原料而下降。

3. farm produce 农产品。produce此处用作名词,一般用以指农副产品,表达工业产品一般用products。

4. primary commodities 初级产品,主要指未经加工或仅经初步加工的农、林、牧、渔、矿等产品。

5. there arose another incentive for trade,i. e. international specialization 产生了另一个刺激贸易的因素,即国际专业化。本句中incentive是主语,arose是谓语,there是引导词。

6. absolute advantage 绝对利益。按照这一理论,一种产品的生产将在生产该产品成本最低的国家内进行,成本包括资本、士地、劳动力等要素。表面看来,这一理论作为生产专业化的基础有很大的吸引力,但真正构成国际贸易思想基础的是比较利益学说 (见下一条)。

7. comparative advantage 比较利益,也称comparative cost比较成本学说。本学说是由英国著名古典政治经济学家李嘉图提出的。按照这一理论,即使一个国家不具备生产某种产品的绝对利益,它也可以生产对自己相对有利的产品与其他国家交换,从中得到利益。这是构成国际分工的重要理论基础。

8. in terms of 在……方面。

9. capital,land and labour资本、土地、劳动力,是生产的三要素。

10. per是“每”的意思,在国际经贸等专业英语中常用,如,15 dollars per kilo每公斤15美元,per capita income按人口平均收入等。注意在日常英语中一般不用per,而用a (an)或every,each. 如,He earns 40 dollars a day. 他每天挣40美元。另外在商业英语中一般不用per year而用per annum。per month和per day是可以用的,但严格地说该用per mensem和per diem。

11. 5 times less efficient in computers 生产计算机的效率要低五分之四 (或……是甲国的五分之一)。注意英语可用倍数表示减少,但汉语却只能用分数表示减少。英语中若说n times less than译成汉语则为“减少了(n-1)/n”或“相当于原来的1/n”,如,The birth rate is now 4 times lower than 40 years ago. 现在出生率比40年前低四分之三。(或:是40年前的四分之一)。

12. Where comparative advantage exists在句中作状语从句,where为关系副词。可译作“只要存在比较利益”。

13. has a strong intuitive appeal 有很强的直觉吸引力。appeal此处用作名词,是吸引力,感染力的意思,再如:The singer has a special appeal to young people. 这位歌唱家对青年人有特殊的吸引力。appeal也常用作动词,表达“呼吁、要求、诉诸”等意,如:appeal to arms诉诸武力,appeal to arbitration诉诸仲裁,appeal to somebody for something为某事向某人呼吁。

14. David Ricardo大卫·李嘉图 (1772—1823) 英国著名经济学家,是使经济学系统化的最早思想家。其代表作为《政治经济学及赋税原理》。他进一步发展了亚当·斯密的《地域分工论》,提出了以“比较成本说”为核心的国际贸易理论。他的这一学说及其以后对该学说的补充、发展,被称为“国际贸易纯理论”或“一般理论”。

15. makes more sense更有意义。短语make sense是“讲得通”“有意义”的意思。如,What he said does not make any sense. 他说的话毫无意义。

16.economies of scale 规模经济,指企业采用大规模生产而使生产过程变得更加经济的行为,反映了生产要素的集中程度与经济效益之间的关系。这个概念有时也用单数来表达,即economy of scale。

17. if each were… 这里使用了虚拟语气。动词be在虚拟的条件句中,不管人称如何,一般均用were。最常见的例子是if I were you…假如我是你的话。

18. reasonable costs 合理的成本。

19. the question which countries will produce what goods. 哪个国家生产什么商品的问题。which后面引导的从句与question是同位语关系。

20. highlighted 此处用作及物动词,是“强调”“使……突出”的意思。这个词也常用作名词,原意是画面光线最强处,引申为最精彩、最重要的部分。例如: The highlight of his speech was on the trade prospect of the two countries. 他的讲话中最突出的部分谈到了两国的贸易前景。

21. take into account other factors 考虑其他因素。

22. affected 虽然可译作“影响”,但不能换用 influence,因affect作“影响”解释时,其实质是“妨碍”的含义。再如: The climate affected agricultural production. 气候影响了农业生产。(实指使生产下降)而influence含义是对……的性格、思想、行为产生作用。

23. tariff barriers,关税壁垒。直接用关税手段来限制输入,通过征收高额进口税、进口附加税、差价税等来保护本国的竞争能力。关贸总协定的减税谈判,削弱了关税壁垒的作用,但它仍是国家间贸易战的重要武器。

24.Customs Area关税区,关税领域。一般说来是与一个国家的领域相一致的。但有的国家内有自由港、自由区或保税仓库,这些均不在该国关税区范围内。还有的国家组成关税同盟,那么这些国家就组成统一的关税领域。

25.Customs Union,关税同盟。两个或多个国家缔约建立统一的关税,对内取消相互间的进口关税,实现内部商品自由流通;对外实行统一的关税,这样的联盟即为关税同盟。

26. Import duties may be either specific, or ad valorem, or a combination of the two-compound duties. specific duties,从量税,以商品的重量、数量、容量、长度、面积等计征的关税;ad valorem duties从价税,以商品的价格为标准征收的关税; compound duties混合税、复合税,英语也称 mixed duties,对同税目的商品,同时按从价和从量两种税率计征的关税。

27. drawback 退税。指国家为鼓励出口,对于已纳税的进口原料经国内加工制成成品再出口,全部或大部分退还进口税的做法。

28. most-favoured-nation treatment最惠国待遇,是发展正常贸易,消除贸易歧视的手段。它通常指缔约国双方在通商、航海、关税、公民法律地位等方面相互给予的不低于现时或将来给予任何第三国的优惠、特权或豁免待遇。最惠国待遇并不是真正的特殊优惠待遇,它只是使享受此待遇的国家不受歧视而已。

29. non-tariff barriers 非关税壁垒,指关税之外的一切直接或间接限制进口的法规和措施,如进口限额等。随着关税壁垒在贸易保护中的作用减弱,非关税壁垒逐渐被广泛釆用。

30. without reference to countries 不论国家,与国家无关。短语without reference to是irrespective(不论及),having no connections with (与……无关)之意。再如: all the people,without reference to age or sex所有人,不论男女老少。

31. Lloyd's 劳合社。英国的保险组织,但其本身不直接经营保险业务,只是为其会员提供办理保险事务的营业所。劳合社对世界保险市场的制度和活动有着重大影响。

32. yet another 又一个。列举时用过 another后,再出现项目时往往用yet another来表达。

33. meriting attention 值得注意。在本句中是现在分词短语作trade的后置定语。Merit在此处是及物动词,作deserve,be worthy of解。

EXERCISES

I. Translate the following Chinese terms into English.

绝对利益 初级产品

规模经济 合理成本

汇款 最惠国待遇

关税壁垒 农产品

补贴 配额

II. Translate the following English terms into Chinese.

comparative advantage natural resources

customs area drawback

customs union Lloyd's

specific duty ad valorem

compound duty trade protectionism

III. Questions.

1.What are the differences between absolute advantage and comparative advantage?

2.How did international trade first begin?

3.What is the meaning of most-favoured-nation treatment?

4.What are the differences between visible trade and invisible trade?

5.What is tariff? Explain briefly the different kinds of tariffs. VGlEHoE+fO6E2fz6PUvq6LR03bZDTGZTIr3cL3EleN6iuiDUBZpJj4A1FslquhiN

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