Theory question 109
International TradeSection B: answer three questions only from this section.
Why does a country restrict her international trade?
Show the model answer
Model answer
To protect infant industries from foreign competition
To correct a balance of payments deficit
To raise revenue through tariffs
To prevent dumping
To protect local employment
To prevent importation of harmful goods (drugs, arms)
To conserve foreign exchange
For political or strategic reasons (e.g. sanctions)
To reduce dependence on foreign countries / become self-sufficient
Explanation
Explain at least five reasons.