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The Global Financial Crises and Protectionism
Question No
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This situation results in the lay-offs of the
employees
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When the there is
protection from imports of the goods from the foreign countries then the demand for the local
product is protected
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Moreover protection from the import of the labor from other
countries will also protect the jobs in the country (Cernat, L and M Madsen 2011)
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So there is more calls for the protectionism from the foreign competition
when there is sharp economic contraction than the boom period (Evenett, S
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2010)
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2
Although there were measures against the protectionists during the contraction period of
2008 to 2009 and the rules like world trade organization were there to stop the protectionism but
still these measures were modest and many countries were able to protect their local producers
from the foreign competition (Cernat, L and M Madsen 2011)
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Some of the
countries provided subsidies to their local producers which able to protect from the foreign
completion and some countries used the bureaucratic changes to protect and put limit imports
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Question No
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, Wermelinger, M
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The domestic producers were able to produce the goods and services at lower costs and
the subsidized products limited the imports
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This would put the companies to shift the
production from the more efficient plants to less efficient plant (Evenett, S
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2010)
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4
The protectionism will protect the jobs in the short run but the in the long run the
protectionism may not serve the purpose of protecting the jobs of the local people (Baldwin, R
and S Evenett 2009)
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If these measures are not
used in an efficient way then the protectionism will make the things worse (Baldwin, R and S
Evenett 2009)
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5
The rebounded volume of international trade in during the year 2010 tell us that a modest
increase in the demand of the of the local production can be increase the production of the goods
and services in other countries and a part of this demand can be served by the production of the
companies in the other countries (Bown, C and M Crowley 2012)
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This is because of the global nature of the
production where the parts of production may come from a number of countries and the
assembly these products can take place in any country and the anywhere in the world (Bown, C
and M Crowley 2012)
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References:
1
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2
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3
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org, 23 March
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Evenett, S
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(2010), “A snapshot of contemporary protectionism: How
important are the murkier forms of trade discrimination?” In: Rising non-tariff
protectionism and crisis recovery: Studies in trade and investment, United Nations
Economic and Social Commission for Asia and the Pacific (ESCAP), Ch
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8–26

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