A trade policy defines the goals, standards, regulations, and rules pertaining the trade relations between two countries. The policies are specified by each of the countries and formulated by its public officials. With the use of trade policies, a country is able to boost its international trade and create intercontinental business partners ( Low, 2016) . Trade policies constitute of taxes that are imposed on both exports and imports, tariffs, quota and inspection regulations. There are different types of trade policies which include national trade policies, bilateral trade policy and international trade policies. The National trade policies are developed by a country to safeguard the country and its citizens best interests. As for the bilateral policies, they are established by two countries engaging in trading activities and helps in regulating their business and trade relations. Finally, the International trade policies are upheld by international organizations such as World Trade Organization (WTO) among others and they uphold the interests of both developing and developed countries ( Low, 2016) . As stated by President John Kennedy, a free and fair-trading system globally would promote economic development and equity for different nations. In my essay, I will focus on the trade policies in the United States and those of China.
US and China are two of the most developed countries in the World and have the largest economies. Their relation is very crucial to the world economy future development. China is in the process of rapidly growing, implementing and devising new economic reforms. However, it is not a World Trade Organization’s member which make the trade issues between Us and China resolved by discordant bilateral negotiations.
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In America, the following are the major trade policies imposed. Initially, America never imposed tariffs on imports and exports. The policy was developed by the US policymakers at the end of the World war two. The policy was made with a belief that lowering tariffs would help in expanding trade. However, this policy is claimed to be the reason why most America is not employed. As result, Donald Trump has increased tariff on imported good so as to secure most of the USA industries. Another trade policy is the imposition of localization trade barriers by American trading partners ( Eichengreen, 2018) . They are defined as measures that serve as a disguise when one identifies the difference between foreign and domestic products. On the other hand, China has various trade policies which include, the introduction of laws on taxation which helped in the improvement of China’s foreign investment. In addition, China has the uses the export and import licensing system so as to reduce the trade deficit. The system is meant to impose stricter rules on the country’s foreign expenditure ( Gourdon, Monjon, & Poncet, 2016) .
In America, the most important trade policy has always been on free trade system where there are no tariffs imposed. The trade policy was developed when the USA, Mexico, and Canada joined to form a world large free trade zone known as NAFTA ( Eichengreen, 2018) . The organization also partnered with the TPP so as to promote economic development in the US, enhance productivity, competitiveness, and innovation, improve people’s living standard and support retention and creation of jobs among many other. All these goals have been achieved in the US up to date. For China, the most important trading system is the use of a licensing system. Th system has really helped in boosting China’s transparency when it comes to trading with other nations. In addition, the process has helped in minimizing information disclosure in the countries willing to trade with China. With this system, China has been able to make trade partners with most developed countries. Furthermore, it has been able to protect its industries through this system ( Gourdon, Monjon, & Poncet, 2016) . In my opinion, America needs to implement the charging of tariffs to the imported and exported good. With this, the nation would be able to help its citizen builds the budding industries. As a result, most of them would get jobs since they mostly blame the open trade system on the increased rate of unemployment in the USA. In addition, tariffs would help in promoting national security, improve environmental standards and prevent hostile trade practices. China should consider imposing the free trade policy since it would have a greater chance of partner trading with the US. In addition, there would be increased export and imports in the country and increased foreign investments as well.
The future of trade policies will greatly depend on the future of the world's trade. Most of the trade policies are not really frank about the unequal trade benefits. In addition, most of them have led to the displacement of unequipped workers leaving them with no opportunities in the new market. In the free trade system between EU and US, most of the countries have trade barriers that are higher compared to those of USA ( Eichengreen, 2018) . This means that the TTP and the TTIP have to make coherent rules that will shape the international markets. If the rules are passed then there would be liberalized trade globally which will bring significant gains to the involved states. However, in this instance, US would be making the regulation in it the favor and in turn, negatively affect the economy of the other involved developing countries.
In conclusion, trade policies define the rule and regulations to be followed by a country when it comes to trade. The policies also give the goals of the country. Trade policies mainly constitute of trade barriers such as quotas, tariffs and taxes and good and inspection regulations. With these policies, national security is improved and the budding industries in the country are nurtured and well developed. In summary, trade policies help in boosting a country’s economy as seen in America and China.
References
Eichengreen, B. (2018). Trade Policy and the Macroeconomy. IMF Economic Review , 1-20.
Gourdon, J., Monjon, S., & Poncet, S. (2016). Trade policy and industrial policy in China: What motivates public authorities to apply restrictions on exports? China Economic Review , 40 , 105-120.
Low, P. (2016). International trade and the environment. UNISIA , (30), 95-99.
