Download Introduction Definition of Key Terms

 SIMUN X Forum:
Economic and Social Council (ECOSOC) Issue:
Measures to reduce tariff barriers and ensure fair access for
developing countries to markets in developed countries Student Officer: Kelsey Lussier Position:
Co-Chair of ECOSOC Introduction Developing countries’ access to markets in developing countries contributes to the globalist
market view of the world as one market, i.e. the concept of globalization. Not only would increased
access to markets in developed countries strengthen the economy of developing countries, but it would
lead to an increased standard of living, which is often somewhat proportional to quality of life.
Historically, markets in developing countries have been focused mainly on the harvesting and vending of
raw materials as well as some manufacturing due to the fact that many transnational corporations exploit
the opportunity of cheap labour, weak currency (compared to USD, CAD, Pound, or Euro), and
extremely low prices. Markets in developing countries have not historically had very much access to
trade with developed countries, as they have been blocked by various trade barriers, including tariffs. Definition of Key Terms Tariff A tariff refers to a national tax placed on the import of goods into a country. It is a type of trade
barrier. The effects of a tariff include increased price on foreign goods, which makes local goods more
accessible and attractive to customers, strengthening the economy of a nation. Trade Barriers Trade barriers work against the concept of globalization. They can be defined as government
measures to impose restrictions on the international exchange of goods and services, i.e. imports.
Traditionally, trade barriers have been set up by governments in order to protect local industries by
making imports more expensive and/or foreign goods less accessible Market A market is a process or medium by which buyers and sellers meet to trade. It can exist in a
single location, multiple locations, or in a virtual form (i.e. the internet). A market is usually associated
SIMUN X with a product, type of product, or an area and usually covers all of the marketplaces with similar
customers for a product. Developing Countries A developing country refers to a country that has a low standard of living and a relatively low
quality of life. Gross Domestic Product (GDP), Gross National Product (GNP), and Gross National
Income (GNI) per capita are also relatively low. Poverty rates and extreme poverty rates are generally
very high in developing countries and infrastructure is generally lacking. Developed Countries In contrast to developing countries, a developed country refers to a country that has a relatively
high standard of living and often a relatively mid-high quality of life.
GNP and GDP per capita is
relatively high and infrastructure is solid and efficient. Transnational Corporations (TNCs) / Multinational Corporations (MNCs) A transnational or multinational corporation is a firm that has its head office in a host country, but
operates through production and selling in many countries worldwide. Regional Trading Bloc A regional trading bloc is an association of countries usually within one region with the collective
aim of eliminating trade barriers and promoting free trade among member countries. Examples include
the European Union (EU), the North American Free Trade Agreement (NAFTA), the Association of
Southeast Asian Nations (ASEAN), and the World Trade Organization (WTO). Globalization Globalization is a movement that can be defined as the growing interdependence of the world’s
economies with the aim of working towards a single global market through the removal of trade barriers. General Overview Economic interdependence of developing and developed countries As was mentioned in the introduction, the markets of developing nations tend to be focused
around the primary and secondary sectors of business. These markets in the primary and secondary
sector of developing countries have been the base of and continuously been the main support for
markets in the secondary and tertiary sector of developed countries.
Thus, it would not only be
beneficial for developing countries to gain increased access to markets in developed countries, but it
SIMUN X would also benefit markets in developed countries, most of which rely heavily on the markets of
developing countries.
Conversely, increasing accessibility of developed countries’ markets could
weaken local markets, as trade barriers are traditionally used to strengthen local industries and markets
by making local products more appealing and accessible to customers within the nation.
This
interdependence of many countries worldwide with weak local markets would lead to an increasingly
fragile situation that could be shattered by something along the lines of the recent events in Ukraine or
Egypt, especially during the early stages of the global market. Benefits of globalization on an economy Globalization would increase the level of competition among businesses. This would lead to
healthy and productive commerce that would work towards an overall strengthening of a single global
economy. Firms can also benefit from economies of scale due to an extreme increase in market size.
However there is a risk that firms could be at risk of diseconomies of scale due to the extremely large
market size. Globalization also encourages the set up of MNCs / TNCs. Effects of TNCs / MNCs on their host country MNCs/TNCs often bring large amounts of capital and employment opportunities into their host
country and due to the high profits they make, pay high taxes to the government of their host country.
They also bring an increased level of international competitiveness to the host country, increasing the
recognition of the host country, which could be beneficial for the overall economy of the nation in the
future. MNCs / TNCs also tend to introduce new technology to their host country, which can be used by
local firms to increase quality, quantity, and thus profits. However, many transnational corporations pay very low wages, treat workers unethically, use up
the raw materials and natural resources present in the country and vacate their premises, leaving the
host country with the aftermath of a struggling economy and a depleted level of natural resources that
may not be renewable.
They can also become too powerful and influence government policies or
decisions in favour of the TNC / MNC. This can lead to civil unrest and a loss of national identity.
Timeline of Events 08/07/1967 ASEAN regional trading Bloc formed 01/11/1993 European Union regional trading bloc formed 01/01/1994 NAFTA regional trading bloc formed 01/01/1995
WTO regional trading bloc formed
SIMUN X Relevant UN Resolutions and Reports •
Economic Development in Africa: trade liberalization and export performance in Africa, 10th of
September 2008, (TD/B/AGC/494(LV))
•
International trade and development, 22nd of January 2003, (A/RES/57/235) Bibliography *Please note: hyperlinks that are bolded are those that you may find helpful in your research* •
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<http://www.ustr.gov/trade-agreements/free-trade-agreements/north-american-free-tradeagreement-nafta>. •
SIMUN X Radcliffe, Brent. "The Basics Of Tariffs And Trade Barriers." Investopedia. Investopedia US, A
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