Barriers to international trade
When we talk about international trade, we can definitely imagine companies taking their products to different countries, or when we make an online purchase and wait for our product to arrive in our hands in a short time because it is in another country. Depending on the type of purchase that is made, we will have to carry out certain customs procedures so that the sale takes place and we can receive what we want.
We call this barriers to international trade : the procedures, legal and tax processes that governments impose to limit international trade. But let's clarify this, since it's not necessarily a restrictive regulation, because it works very well to carry out certain controls that benefit the national trade of each country.
What are the barriers to international trade?
It's important to mention that each control imposed by governments can vary depending on the trade alliances signed with certain companies, organizations, or governments directly through foreign ministries. However, it's a tedious process that, for some, can take several months or even several years (depending on the merchandise and the size of the export or import plan).
Below are the types of barriers to international trade that you may encounter:
Customs barriers
In the first place, we start with the customs tariffs, which are taxes that are placed on the merchandise that enters the country, there are several and that depends on the price and the quantities of the products (Ad Valorem, Specific and compound), the price of They can change depending on the commercial alliances that have been signed with other countries.
It should be noted that these payments must be included in the export and import plan that each company carries out in advance, as part of the operations planning so that everything works correctly, and the product reaches its destination without problems. In addition, all the necessary procedures mentioned above must be included, and even a fund of probabilities, so that, within risk management, the company is properly prepared for any obstacle.
No duty barriers
This field includes all the customs and non-customs procedures and processes that the merchant must comply with so that the merchandise enters the country with all the established regulations, correctly. This includes:
- administrative barriers: This includes the sanitary measures, the permits, the agencies that will be in charge of the operational process, the expiration date, the coordination of the shipment of the merchandise (shipping licenses, phytosanitary permits, labeling control, etc.).
- technical barriers: These are the shipping coordination processes specifically, they are in charge of controlling the quantities of products that must be sent or entered, and depending on the price and quantity, the determined tariff is established, the adequate transport, the time that the product takes in reach the customer, etc.
- tax bonds: It is one of the types of international trade barriers of the non-essential type, since it is not a mandatory use, but it is highly recommended, especially for small and medium-sized industries that are adapting to these shipments, because it will help them with the operations and costs of the entire customs process , in addition to the protection of its products.
What are international trade barriers for?
Mainly, they are implemented so that the national trade of each country can maintain a good position in the market, so that the products made by national labor have a better price than the foreign product, that the country can increase its national production and do not depend so much on the outside, so that, over time, they will be able to create good commercial relations with other international businessmen and send the products that are produced within the country.
Important processes to be carried out
Now, for the entry of foreign merchandise into the country, a large number of procedures must be carried out that cannot be evaded, so that the product reaches its destination, that is, tariffs must be paid, transportation, comply with sanitary and shipping regulations, specify the destination of the product and who it will benefit, the prices that will be set and where it will be sold, its distribution, etc.
An export plan is a fundamental part to consider.
The price of tariffs
Tariff prices are set by the government, either through prior market research or through agreements with certain countries, and this generates a significant source of revenue for the nation. Therefore, as stated above, international trade barriers may benefit some, while others, if they want to import their products to that country, must comply with its customs rules and regulations.
If you want to learn much more about this interesting customs topic, then I invite you to read this wonderful article, in which you can clear up any doubts about these important processes: Customs Regimes.
Furthermore, to expand your knowledge about customs, specific procedures, and barriers to international trade , you should watch this video, which explains every detail.
