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Eureka: A list of non-tariff trade barriers Eureka: A list of non-tariff trade barriers
by Akli Hadid
2018-04-20 08:31:25
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Trade wars have been making headlines. In many countries, you can be a foreigner and set up a business in that country if you are willing to export products to a different country, or perhaps if you are willing to produce for domestic sales. But a lot of countries make it harder to import products, that is to bring products from your country of origin to the local market. For example, you can buy Chinese toys and sell them on the American market, or if you really want to you can set up a toy factory in China and try to sell toys in the local Chinese market or export the toys to the American market. But if you bring American toys and try to sell them on the Chinese market, you could be in trouble. So here's a non-exhaustive list, in no particular order, of non-tariff trade barriers that countries face around the world.

tra1_400-Breaking into the local ranking system. A lot of countries, especially Asian countries, have conglomerates who produce just about everything and newspapers publish their rankings each year. Rankings are supposed to give an indication of the quality of the product and help guide consumers in their decisions. The problem with foreign companies and foreign products is that they don't fit into the ranking system, and are thus difficult to sell or be appealing to local consumers. 

-Being branded and labeled as a “foreign” product. In some countries, there is a preference for national products. Some countries even have organizations that promote national products and that encourage consumers to produce national products. When you are labeled as a “foreign product” you tend to be confined to a specific branch of consumers, usually those who lived abroad or fantasize about living abroad. In some countries, when you buy a foreign car or serve a foreign dish at a meal, you're really betraying your country. This doesn't help foreign companies and products. 

-Unclear and constantly changing rules. A lot of countries don't include “procedure” in their legal system. That is there are no clear procedures on how to set up and register businesses, how to legalize a product for trade and what procedures to follow in case of disputes. Absence of procedures means you constantly have to improvise and there are constant surprises, meaning you will have to spend a lot of time thinking about procedures, when you should be thinking about sales.

-Bureaucracies who take your trade and technology secrets and share them with competitors. In a lot of countries administrations who collect information are supposed to keep the information in a safe and not share it with anyone. In many other countries, big business collects information on technology and product design from those very bureaucracies who are supposed to keep it secret. They also collect private information on businessmen that they use at the businessman's disadvantage. 

-Competitors engaging in psychological warfare. You set up your headquarters in an area, your competitor sets up a branch in that area. You start walking in the streets and are under the impression that someone's following you. A box of eggs is left every morning at 4 AM in from of your headquarters, or some stupid thing like that which is meant to irritate you. Soon enough they send you a video of you making out with that guy or girl you met the other day at a club. When they can't make you leave, they'll try to drive you crazy.

-No clear news outlets and information channels. You're supposed to read the newspapers carefully because that's where all the big announcements are made. Except that when legislators in that country decide something big, they don't tell the foreign press to report it. Your colleagues are in the dark, and you are in the dark.

-Trouble finding accountable human resources. Because the best human resources want to work for the bigger companies, as a foreign business in some countries you are considered a small business and only those who got rejected from everywhere else will come work for you. This means you'll have trouble finding skilled and professional people to work for you.

-”Cultural” sensitivity. I think culture is important. But when you're told that the way you're walking is wrong, the way you're talking is wrong and the way you're holding a spoon is wrong, that's not cultural sensitivity, that psychological warfare.

-Visa and bureaucratic issues. If there are no clear guidelines on how you can stay in the country, or if you can only stay one year when a person staying in your country can have a visa for 20 years, and that you constantly have to gather paperwork including federal criminal background checks from your country when you haven't visited your country in years. Or in some cases you are told you have to leave the country because you had a parking ticket back home. This actually happens in some countries.

-Corruption. Sometimes you downright have to bribe bureacrates and the police to get ahead of them game when it comes to trade. If you don't bribe them, they'll fire back. 

-Lax security. It ain't fair trade if you constantly have to worry about people pillaging or vandalizing your factory, or if you constantly have to worry about gangs chasing after you, and that the police does nothing about it.

-Contract violations and no legal recourse. If you're trading with a foreign country, you will need partners to do business with. Some countries will tell you that a contract has no clear legal value and that verbal agreements are more important. So if the partner runs away with the money, it's basically your fault.

-Scams and dealing with organized criminal organizations.In some countries you downright have to deal with organized crime and have to be on the altert for all kinds of scams. After all, you are doing business in a foreign country, so some people will take advantage of that. 

-Lack of clear advertising chanels. I laughed out loud when some guy was trying to buy ads on google in South Korea. Only 11% Koreans use Google, most of them are either foreigners or have lived in a foreign country. But in some countries, there are no clear channels for advertising, as there are no statistics on viewers, readers of web visitors, nor is there information on media consumer trends and how people consume the media.

-Lack of professionalism. In some countries, people show up to the job like it's their home, they show up early do nothing all day, and can't get a single task done. In other countries it's hard to even get workers to show up to work on time, and they like to leave early. In some countries administrations close whenever they feel like it, and businesses close whenever they feel like it. In other countries businesses open 24/7, but they “can't tell you anything” because “the boss is not here.”

-Racial discrimination. In some countries partners will avoid you because of the color of your skin or the color of your passport. In other countries people will take advantage of you because of your color or citizenship, and even bluntly tell you that your product should be cheaper because you are not a “white American.”

-Sabotage. In some countries, if they don't like your business, they will plain sabotage it. They can launch media campaigns against it, because hey, conglomerates also own a lot of media outlets and have close relations with the media. In other countries administration will sabotage you, and in some countries your staff will sabotage you.

Those are the non-tariff trade barriers I could think of. Good luck exporting to a foreign country!


        
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