Does 'free trade' advance or retard development in poor countries Essay

Does 'free trade' advance or retard development in poor countries - Essay Example The following paper evaluates the effectiveness of the free trade policies as far as the betterment of the poor nations is concerned. It analyses the arguments in favor and against of free trade with references of the development of the developing nations or the poor trading partner in the equation. Free trade has become one of the debated topics around the economic world. The terminologies of globalization, free trade, liberalization, socialization are also discussed in this paradigm. Before the actual argument can be established, it is imperative to understand the different terms and concepts that can have an impact on the argument itself. As the name suggests, globalisation refers to strengthening relationship between organisations, governments and individuals across geographical horizons. The term is generally used to regard economic globalisation. Economic globalisation can be explained as: increasing economic activities across the globe, through distribution of products or services by reducing international trade barriers. International trade barriers are placed by countries for various reasons. Some strong reasons could be to stipulate the use of local products, not compromising taxes, fear of rise in un-employments, pressure in maintaining budgets and dilution of long held customs and culture. Trade barriers can be tariff, import quotas, exchange rates, conflicting cultures and export fees etc. A dramatic increase in the process has been witnessed in the last decade. Technology has reduced the communication gaps between geographies. Travelling across national borders has been made easier and as a result doing business internationally has lesser complications in the modern age. The introduction and implementation of International Accounting Standards (IAS’s) and International Financial Reporting Standards (IFRS’s) has made comparisons between organisations appropriate. Comparable and understandable flow of