Importance Of International Trade Policy

International Trade Policy In the paper, I want to talk about some international trade policies, I totally believe it’s necessary to make some policies to manage the international trade between different countries. Actually the international trade is the exchange of labors, capital ad goods between different countries, most countries produce the agricultural products, materials and other goods to sell to other countries to get reward. International trade can increase the productive capacity of an economy;it can enhance technological diffusion and it can also expand product market. Generally, a country get improvement in standards of living according to trade. Yet, most countries are trying to increase exports and use less money to purchase imports to improve GDP. Even some countries increse the tariffs in order to get a lot of profit, and it causes a lot of conflict between countries. Therefore, countries make some important international trade policies to manage the trade, such as free trade …show more content…
According to the article “Free trade agreements versus customs unions”, Krueger explained that customs union is an arrangement between the member countries. “Customs union is an arrangement in which there is zero duty between members on imports of goods and services, and a common external tariff” (Krueger 6). The difference between free trade area and customs union is that the free trade areat has a common market, but the member counties still maintain own trade barriers and set up different external tariff to other countries. However, for customs union, while each country enjoys the common market, they still adopt a common external tariff and trade policy to foreigner trade. It maintains the normal flow of goods issue and increases the ability to fend off