Explain six circumstances under which a country may restrict international trade. (12 marks)

Explain six circumstances under which a country may restrict international trade.

Circumstances under which a country may restrict international trade.

1. Where there is need to protect local/infant industries which may not withstand competition foreign  established foreign industries.
2. Where there is need to control dumping to prevent adverse effects on the economy.
3. Where balance of trade/payment continues to deteriorate to reduce payment on imports.
4. Where goods are hazardous/harmful for consumption in order to protect the health of consumers.
5. Where goods involved are a security risk to the country to ensure peace and stability.
6. Where it is necessary to counter the actions of trading partners as a retaliatory measure.
7. Where there is need to avoid imported inflation arising from overpriced imports.
8. Where it is politically expedient to do so in order to promote good governance in another country.
9. Where there is need to safeguard local employment which may be lost through entry of cheap imports.
10. Where there is need to avoid overdependence on imports which may lead to political blackmail.
11. Where there is need to avoid overexploitation of resources which may cause their depletion.
12. Where there is need to build reserves of strategic commodities to avoid shortages in meeting local demands.

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