Trade Liberialisation

Trade Liberialisation

1. Reduced trade barriers

   • Increase levels of trade and competitiveness
     • Forces domestic efficiency of firms to increase as lower import prices (reduced protection) has meant it must increase so that firms maintain profits. Increases international competitiveness and net exports. Also increases productive capacity of the economy by effieintly using capital.
       • Allows for increases in exports, human and physical capital through competition
         • Allows for increases in AD, AS and GNI/capita
           • Allows for increases in growth, development and standards of living as a result (more variety of goods and services available at lower prices).