This article highlights the new
challenges facing international trade because of the protectionist
policies from Trump and the British leaving the European Union. The growth
in express delivery has been record breaking for some companies. The ease and
mobility of purchasing things and moving it through countries is due to free-trade
areas and lower tariffs. The ease of shipping between countries comes from
strong international policies that promote international trade. However, in
recent months the changing policy to protectionism has created problems for
international trade. “Mr. Trump’s threats to raise tariffs on goods from China
and Mexico, together with the indication last month from Theresa May, Britain’s
prime minister, that the country will leave the EU’s customs union,” cause
concerns that trade will fall dramatically causing problems for manufacturing
countries and for shipping services. With the change of a physical boundary between
UK and the EU it’s unlikely to cause physical disruptions because packages have
already gone through EU checks. This
article outlines the difficulty in classifying some products for the proper
tax. Additionally, with protectionist policies coming from Trump and the
British it is likely that consumers and producers will start seeing huge
expenses similar to these “Sending
an item from Britain to Switzerland (outside the EU) costs 150% more than it
does to Italy (inside the EU)”. This
will not only cause problems in the shipping industry but it will be a huge
expense for domestic manufacturers as they will be limited to only domestic
consumers.
2 comments:
If United States put higher tarrifs on foreign goods, there is a good chance that other nations would do the same for American products. So, logistics companies might take a hit harder than the article stated.
Protectionist policies are relatively deceiving. At the same time that they are intended to protect the domestic market and promote local manufacturing, thus creating more jobs, it disregards the cost benefit issue that makes every business prosper. Global markets offer not only access to lower cost structures (raw materials, for example) but also cheaper labor. Imposing high tariffs will demotivate companies to make business with the US and the country will suffer a backlash.
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