International Marketing Essay Example | Topics and Well Written Essays - 2000 words

International Marketing - Essay Example Tariff is a tax which is imposed on imported goods with an intention to increase revenue of domestic industries and protect them. Apart from non-tax barrier, the entire barrier of trade is considered as non-tariff barrier. Both tariff as well as non-tariff barriers may result in creating difficulties for national economies in the long run. In this paper, the distinction between tariff and non-tariff barriers has been elucidated succinctly. The paper also covers in detail the non-tariff barriers faced by a marketing organisation while conducting business with developed and industrialised countries (International Marketing, 2010). 2.0 Distinction and Explanation of Differences between Tariff and Non-Tariff Barriers to Trade Trade barriers are often tariffs and taxes imposed to protect and increase the revenue of local producers. International efforts to eliminate these discriminatory tariffs have been an on-going process for around 50 years. This process is synchronised initially by th e General Agreement on Tariffs and Trade (GATT), which is followed by the World Trade Organisation (WTO) and also other nine rounds of the international trade negotiations which govern the current WTO system (Business Link, n.d.). A tariff is a tax which is imposed on foreign goods when they enter a country. It is a tax which is imposed on the imports of commodities into a region and is considered to be among the oldest forms of government intervention in economic activity. This tax is implemented for two reasons which include: i) it provides income for the government, and ii) it develops economic returns to firms as well as improve suppliers of resources towards domestic industry that face competition from foreign imports. Tariff facilitates the income of domestic producers from competition in foreign environment. This protection helps the consumers, who generally pay higher prices for import-competing goods to pay at an economic cost in the domestic environment. Furthermore, it al so comes at an economic cost towards the economy through inadequate allocation of resources towards the domestic industry which has been competing for imports (Sumner & Et. Al., n.d.). Non-tariff barrier is a non tax barrier which is imposed by governments in order to support domestic suppliers over foreign suppliers. This type of barrier covers broad range of measures. A few of the measures among these possess a comparatively insignificant trade effects and this may include packaging as well as labelling requirements that may hinder trade but only marginally. Various other non-tariff measures are quotas, restraints, voluntary restraint of export, non-automatic import authorization and trade restraint under Multifiber Arrangement along with variable import. All these have been considered in order to reduce imports and thereby benefit domestic producers (Coughlin & Wood, n.d.). Quota is a restriction specified in either value or physical units while importing the products for a speci fic period. It is implemented by means of licenses issued to either importers or exporters. It is also related to import from a few countries or from all foreign countries. Voluntary export restraints and Multifiber