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tariff and trade restrictions at Greatest colas?

answer :- Thank you for the opportunity to present my views on tariff and trade restrictions before you. As you all know that Greatest colas is one of the World’s largest producers of aerated beverages in the world, being the industry leader and having a major presence around the world, our company has to follow a number of rules and regulations to comply with many international trade laws. As said by Jeffry Sachs the Director of Center for International Trade at Harvard University. ”Fifteen percent of world population provides all world’s technology innovation one half follows it, rest is not aware of these things”, Today when globalization has become a rapid phenomena bringing forth that paradigm shift thus knitting the world to form a global village there is no survival if cutoff from the rest of the world as no nation is self-sufficient, be it in terms of technology or resources. Trading augments this growing relationship liquidating the herculean task of meeting needs exponentially increasing availability when coming to choosing things. The whole world has become a well connected market threaded by supply chain management engaged in mutually beneficial exchanges. Tariffs and Trade restrictions play an active role in controlling the industries and also pacing the world economy. Tariff is a tax on goods when they move from one country to another. Tariff is for the revenue purpose and protecting industries. Tariffs are two types protective and revenue tariffs. A tariff is paid for by the buyers of the foreign goods and the buyers of domestic goods who pay higher prices. The Tariff commission sets the tariff. The HTS of the United States was enacted by congress and made effective on 1 Jan 1989, replacing the former Tariff Schedules of the US. Tariff helps to raise the price of the imported product and helps the domestic products of similar nature to be sold at higher costs but they reduce exports. The various models for acquisition and reaching Global market for global business expansion are multinational enterprise, foreign representation, licensing, franchising, joint ventures, strategic alliance, foreign direct investment, subsidiary and contract manufacturing. In a franchise agreement, the franchisee pays the franchisor for a license to use trademarks, formulas and other trade secrets. There is a freedom to adapt their products to meet the needs of the market. Contract manufacturing is when a foreign countries production of a private label good to which a domestic country attaches its trade mark. Joint ventures is a mode of expansion involving two or more parties. They share technologies, market management expertise allows a foreign market where normally they would not be allowed but for the risk of breaking of agreement by any of the partner and the inflexibility involved due to vastness of spheres involved. International trade has a lot of benefits but still many nations have their own reasons in putting restrictions on trade. A Quota is a restriction on the quality of importing goods. It actually creates a shortage which leads to the cost of the goods going up and allowing the domestic producers to increase their prices and production. A Quota on watches, might limit foreign made watches to 50000000 pairs a year. If American buy 100000000 each year, this would leave most of the market to American producers. Embargo is another trade restriction. Trade restrictions thus shift production from more effective exporting producers to less effective domestic producers. World trade is limited but industries get protected within countries. For the world economy to strengthen free trade is very essential and for the national economy to strengthen there must be enough import only then there will be export. The WTO created on 1Jan 1995.It was to replace the General Agreement on Tariffs and Trade or GATT.WTO is a forum with 153 nations as members where trade agreements are negotiated between governments. Its rules support maintain trade barriers ,as an independent entity it oversees the cross border issues. The WTO with Dispute Settlement Body, a significant forum resolves the international trade disputes between WTO members. USITC, OFAC, FTC helps to keep up the comity in the international trade front lively and healthy. Notes 1.Valorem Tariff- is a value percentage set on goods on import. 2.Specific Tariff - is a tariff of specific amount of money that does not vary with price of goods. 3.Protective Tariff- to artificially inflate prices of imports and protect domestic industries from foreign competition. 4.Prohibitive tariff -protects local producers also raises revenue. 5.USITC- United States International Trade Commission responsible for conducting global safeguard and market disruption investigation under Trade Act of 1974. 6.OFAC- Office of Foreign Asset Control administers sanctions preventing trade. 7. FTC-Federal Trade Commission has quasi- legislative a

Public Comments

1. So, what's your question? Tariffs definitely inhibit trade. Yes they probably are a necessary evil. Welcome to the 20Th Century. Free trade will be norm in the 21st. It's the only way a single currency can evolve.