IN the world of exports and imports, you must learn about trade barriers in order to be able to understand fully the processes your products are subjected to before they leave the country or before they enter another country.
In simplest terms, a tariff is a tax. It adds to the cost of imported goods and is one of several trade policies that a country can enact.
So also by simple definition, trade barriers are measures that governments or public authorities introduce that prevent or restrict overseas trade and investment. These measures need not necessarily take the form of legislation or a specific decision.
They may also take the form of current practice. As a result of these measures, domestic companies receive a competitive advantage relative to their foreign counterparts.
A trade barrier may be linked to the very product or service that is traded, for example technical requirements. For example, in Fiji all fresh produce exported must first satisfy the standards set by the Biosecurity Authority of Fiji.
This is because other country's also having their biosecurity standards for goods entering their country too.
A barrier can also be of an administrative nature, for example rules and procedures in connection with the transaction. In a number of areas, special international ground rules have been agreed, which limit the ways in which countries can regulate trade. It means that some barriers are legal while others are illegal.
This will apply to for example for those that trade in the European Union.
Trade barriers within the EU are subject to special rules that apply to the internal market of the EU only.
Some of Fiji's fishing vessels have been scrutinised and upgraded to be fully recognised as having EU Standard for example. One of the requirements is that they have the capacity to full freeze blast fish to -100 degrees celsius.
Trade barriers may take the form of, for example:
* customs duties;
* customs procedures;
* technical regulations, standards - for example for the purpose of consumer protection, health protection, protection of the environment etc;
* veterinary and phytosanitary measures — barriers based on health and safety regulations;
* restrictions on access to primary products — for example in the form of export levies that drive up prices artificially or special export prices that are higher than the price of the same primary products for use in national processing industries;
* insufficient protection of intellectual property rights — both with respect to the scope of protection and with respect to the possibilities of legal protection. This includes, for instance, protection of patents, copyrights, trademarks and geographical indications of origin;
* barriers to trade in services — for example in the form of discriminatory conditions;
* restrictions on access to investment — for example through national participation requirements or restrictions on access to repatriation of profits; and
* unfair application of state aid and other forms of subsidies.
Due to globalisation, trade restrictions have become increasingly significant.
As a consequence, other trade restrictions have become of relatively greater significance. These other trade restrictions are often based on regulations and principles relating to qualitative matters, for example: product quality requirements and product packaging requirements ostensibly for the purpose of consumer protection; education and qualification requirements for providers of services; or rules relating to patent and trademark protection.
This has contributed to making it more difficult for companies to gain an overview of rules and changes to rules, making the handling of trade barriers more complicated, as barriers touch on matters that are subject to internal national legislation or regulation in the export markets.
(Sources: The Economist, Investopedia)
* Jone Kalouniviti is a public relations officer with the Fiji Export Council. Email: jkalouniviti@gmail.com