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INTERNATIONAL TRADE, cont.
+ * EU*
RB, p 45-55
MK, U 27
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READING: RB, p 45PROTECTIONISM AND FREE TRADE, cont.
After reading the specified paragraphs
match with headings 1&2 3-5
Organizations promoting free trade
Reasons for protectionism
Economic reasons for free trade
Problems of developing countries
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Collocations from pgs 1 & 2
rai______ living standard
spe______ in the production
c________ advantage ___ producing...
fac______ of production
natural r_________
div_______ of labour
ec_______ of scale
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Collocations from pgs 1 & 2raise living standard
specialize in the production
comparative advantage in producing...
factors of production
natural resources
division of labour
economies of scalePairwork: Practice talking about economic reasons for practicing free trade / trade liberalization(use the phrases above, propose further phrases)
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Free trade vs. Protectionism
• International trade (imports and exports) without government r__________
• Trade of goods and services without trade b_______
• Protection of d________ industries against foreign c________
• Government restrictions are placed on the i______ of foreign competitors
(tarrifs, quotas and subsidies)
estrictions
arriers
omestic
ompetition
mports
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Reasons forTRADE LIBERALIZATION
• spe_______n• a______e/c________e
advantage• a_____s to markets • intern. c________n &
efficiency• efficient market
m_________m• freer m________t of
resources• f______m to choose
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TRADE LIBERALIZATIONvs. PROTECTIONISM
(reasons for) (reasons for)
• protect jobs (v____s)• protect d_______c ind.• strategic reasons
– i_____t industries
• political p______e• protect culture (?)• r______e• prevent d________g
• specialization• absolute/comparative
advantage• access to markets • intern. competition &
efficiency• efficient market
mechanism• freer movement of
resources• freedom to choose
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TRADE LIBERALIZATIONvs. PROTECTIONISM
(reasons for) (reasons for)
• specialization• absolute/comparative
advantage• access to markets • intern. competition &
efficiency• efficient market
mechanism• freer movement of
resources• freedom to choose
• protect jobs (votes)• protect domestic ind.• strategic reasons
– infant industries
• political pressure• protect culture (?)• revenue• prevent dumping
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Which reason for imposing barriers to trade should apply?
Why? Explain the cartoon!
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Collocations from paragraphs 3, 4 & 5 im________ tariffs & quotas / restrictionspro________ strategic / infant industriesab_________ sectorsl____ to structural unemploymentred________ a balance of payment deficitpr_________ against dumpingdes_______ or wea______ competitorsret________ against restrictionsa_________ economies of scales____ a limit to importspro______ revenue for the government
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Collocations from paragraphs 3, 4 & 5 impose tariffs & quotas / restrictionsprotect strategic / infant industriesabandon a sectorlead to structural unemploymentreduce a balance of payment deficitprotect against dumpingdestroy or weaken competitorsretaliate against restrictionsachieve economies of scaleset a limit to importsprovide revenue for the government
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TRADE BARRIERS
• Tariffs
• Import quotas
• Embargo
• Subsidies
• Non-tariff barriers:
Import substitution
Safety norms
Customs difficulties and delays
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Name the trade barrier1. Taxes on imported goods. They raise the price to
customers and make them less attractive.
2. Limits on the quantity of a product that can be imported into a country e.g. 200,000 cars.
3. Laws and safety guidelines.
4. Making it difficult to arrange all certificates necessary to import into a country.
5. When a country produces and protects goods that cost more than those made abroad.
6. Money paid by a government to producers of certain goods to help them provide low-priced goods without loss to themselves.
7. A government order to stop trade with another country.
Tariffs
Quotas
Subsidy
Safety norms
Import substitution
Embargo
Custom difficulties and delays
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Barriers to free trade and what to do with them:Complete the sentences with appropriate terms:
Customs ______ on seafaring vessels are very high.
Only breeders of endangered species qualify for government _________.
If the Govt. lifts import ________ for apples, nobody knows what quantities of apples will be imported.
The Government decided to impose a high _____ on the import of SUVs in order to disuade people from buying them.
Importers will face charges if they ________ quotas.
The government will _______ subsidies to electric car companies and their suppliers.
duties
subsidies
quotas
tariff
exceede
grant / provide
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RB, p 46
Read paragraphs 6 & 7 to explain: ORGANISATIONS PROMOTING FREE TRADE &
THEIR FUNCTION
OPPOSITION TO FREE TRADE
Heading?
Organizations promoting free trade
Reasons for protectionism
Economic reasons for free trade
Problems of developing countries
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• What is GATT?
• What is WTO?
• What does the final GATT agreement from 1997 include?
• Which form of protectionism is the only one allowed by the WTO?
• Why did it take 50 years to finalize the agreement?
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Collocations from paragraphs 6 & 7
gr____ favourable conditions
opp_____ free trade
countera_____ a fall in prices
pra______ import substitution
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Collocations from paragraphs 6 & 7
grant favourable conditions
oppose free trade
counteract a fall in prices
practice import substitution
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Read paragraphs 8 & 9 to explain:
PROBLEMS & FEARS OF DEVELOPING COUNTRIES (IMF)
Heading?
Organizations promoting free trade
Reasons for protectionism
Economic reasons for free trade
Problems of developing countries
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Read paragraphs 8 & 9 to explain:
PROBLEMS & FEARS OF DEVELOPING COUNTRIES (IMF)
1 need to repay huge d____ - IMF imposed obligation to export
2 s_______ of the East Asian “Tiger” economies
3 c_______ of the Soviet Union
4 potential ex________ from the t______ blocks (the EU, NAFTA)
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Read paragraphs 8 & 9 to explain:
PROBLEMS & FEARS OF DEVELOPING COUNTRIES (IMF)
1 need to repay huge debts - IMF imposed obligation to export
2 success of the East Asian “Tiger” economies
3 collapse of the Soviet Union
4 potential exclusion from the trading blocks (the EU, NAFTA)
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Collocations:
p_____ the interest r______ the principalr______ (renew) a loanr _________ (postpone) repaymentsi________ severe conditionst_______ blocksl_______the economyl_______trade barriers
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HW: RB, p 47 Write the questions.
MK, p 133 Education and protection
Read the text and get ready to answers
Questions 1 & 2 + Discussion