Trade barriers are divided into 3 main categories, which consist of natural barriers, tariff barriers, and nontariff barriers.
These barriers influence global trade between businesses and governments and have direct impacts on trade agreements between such parties. They are also reflected in the prices of imported goods, as well as the availability of such goods. Today, we will delve into the various aspects of trade barriers and how these elements can be a determining factor in cross-border trade agreements between governments and businesses.
Natural trade barriers include elements that are out of our control. Distance and language are 2 of the most common natural trade barriers, influencing the viability of trade agreements worldwide. Culture can also play a pivotal role as a natural trade barrier. For example, if a company in South Africa produces locally inspired clothes and wants to export their products to Australia, a few natural barriers can come in the way of securing such a deal. These could include the distance of the trade route, the cultural difference between our locals and theirs, and if applicable, a language barrier between the local South African company and the Australian companies and/or authorities.
Tariff barriers are when tariffs are enforced on imported goods. Japan has a tariff on imported American cigarettes, which makes them more expensive for the Japanese locals to buy. This influences the market for the U.S. tobacco businesses, as they only get a small percentage of business because of the tariff being placed on their goods. Nontariff barriers are non-financial conditions enforced by governments on imported goods. These conditions can include embargos and quota limits on imported goods, which will directly influence a trade agreement.
Luckily, BlueBlox is here to assist you in overcoming these trade barriers. Our local experts and consultants give our clients insight into these trade barriers and provides understanding on how to overcome them compliantly.
BlueBlox is your trade compliance consulting house that can make a difference in setting up your trade operations and ensure that you overcome the trade barriers in Africa, the Middle East, and Eastern Europe.
For more details on how we can assist your business, please browse our website, or contact us directly.