NON TARIFF BARRIERS

BY # NABILA AMRINA, NUR MASYHA, DAN NASIRAH

               Non-tariff trade barriers are limiting and controlling the total of goods and services imported from entering a country. It is commonly used by countries in the conduct of international trade and are usually based on the type of goods and services to be imported as well as political alliances between trading nations. Generally, any obstacles that exist in international trade will result in an economic loss of the importing country. This is because it will limit standard market trading functions.

               There are several types of non-tariff barriers that can be taken to control and limit the amount of goods and services imported. Among them is the quota that is a government action to limit the maximum quantity of goods and services with the consent of importing countries involved in a given period of time. Second is the exchange control where it is the government and the central bank will reduce the supply of foreign currency of a country and this is causing the country to reduce their total imports. The third is an export subsidy in the form of a financial grant from the government to export-oriented manufacturers. Nemesis is the embargo, restrictions whole of a country. Last are the health and safety standards in the form of regulations.

               The main purpose of non-tariff barriers is to obtain a source of national revenue through import duties or excise duty imposed on imports. The second is to protect the young and the local industry. The third is that anti-dumping avoid dumping of imported goods in the market. The fourth is to enable young people and local industry to compete in the domestic market. Last is the safety factor to prevent the entry of dangerous good

               For a nation to non-tariff barriers is that they believe it is a way to develop the country and generate revenue. In addition, this non-tariff also supports the weak existing industry in a country market. The third is due to the ability of a group to influence the process of the absence of opportunities to get government support for the tariffs. A non-tariff barrier is also giving some benefit for the country. Among them it can protect the local industry from foreign competitors, offering protection to the economy of certain foreign countries that like to trade with them and increase employment opportunities in the country. In addition, there are also disadvantages of non-tariff barriers that hinder free trade and could lead to trade wars.

               In the implementation of non-tariff barriers are some policies in place to address the problem in the future. Among them are commercial basis is one of the underlying reasons for the existence of organizations such as the World Trade Organization (WTO). Next is a Free Trade Agreement (FTA) which is an agreement between two or more countries and establish the ASEAN Free Trade Area (AFTA). Lastly was the creation of an anti-dumping rule to protect local industry.