Presentation on theme: "INTERNATIONAL TRADE. Main Arguments for Protecting Trade (from video) n Protects Jobs n Protects Industries n Fair n Can Raise Revenue n National Defense."— Presentation transcript:
Main Arguments for Protecting Trade (from video) n Protects Jobs n Protects Industries n Fair n Can Raise Revenue n National Defense n Infant Industry n Export Promotion
Types of Trade Restriction 1. Tariff - Тариф 2. Quota – квота (жеңілдік) 3. VERs Voluntary Export Restraints (өз еркімен экспортты шектеушілер) 4. Non Tariff Barriers (Health and Safety Regulations) (тарифтік емес кедергілер) Also support exports through subsidies. (Субсидиялар)
Trade Barriers - Economic Trade Barriers - Economic –tariffs –taxes on imports –quotas –limits on the quantity that can be imported. –VERs –Voluntary Export Restrictions –Non tariff barriers –i.e. rules and regulations making importing difficult/impossible
Tariffs n Advantages n Government gets revenue n Discourages imports n Disadvantages n May not work n Increases prices n Could be retaliation n On boards draw a graph showing tariffs
Quotas Quotas n Advantages n Can be targeted n Is bound to work n Disadvantages n Raises domestic prices n Can be retaliation
Voluntary Export Restrictions n Advantages n Very effective n Fosters good relations n Disadvantages n Country may not agree to it
Non Tariff Barriers/Health and Safety n Advantages n Not as obvious as other barriers n Can avoid retaliation n Disadvantages n Maybe more annoying than other barriers
Subsidies n Advantages n They encourage certain industries n Not as contentious as other barriers n Disadvantages n Cost the government money n On boards draw a graph showing subsidies
Subsides n Advantages n They encourage certain industries n Not as contentious as other barriers n Disadvantages n Cost the government money n On boards draw a graph showing subsidies
In groups of 3 – 4 (10 minutes) n Decide what should be Kazakhstans priorities e.g. what industries you would try to help and why? n What trade barriers tools would you use and why? n Present this to the rest of the group.
Tariffs in Kazakhstan n For final products more than for raw materials. n E.g. sausages 44% n packed juice, 46%
Export Duties n Kazakhstan levies export taxes on a limited number of commodities when they are exported to non-Economic Union countries. Ferrous metal scrap is cited as an example,
Tariffs in Kazakhstan n The current tariff schedule based on six percentage rates: n 0, 5, 10, 15, 20 and 30.
Non-Tariff Barriers in Kz nThe Investment Law n Puts investment in priority sectors of the economy n Puts local and foreign investors on an equal footing n Doesnt guarantee international arbitration n Doesnt protect investors against future changes in legislation
The procurement rules of June 2002 n Strong State control over the tender procedures in the oil and gas sector,
The transaction passport To help make importing easier To solve many of the paperwork issues
Government procurement n The government has taken steps to improve the transparency of the procurement process.
Services n Oil companies must purchase services only from Kazakhstan-based companies unless the required service is unavailable in Kazakhstan.
The Law on Production Sharing n Agreements also requires that KazMunay Gas, the national oil company, should have at least 50% in offshore oil and gas projects. n Foreigners are not allowed to own more than 20% of a mass media company in Kazakhstan.