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3 years ago

Why don't developing countries usually benefit from free-trade policies?

2 answers:

8 0

The correct answer should be A.

Developing countries industries are not developed enough to compete which leads to production that can't be exported which leads to losses.

stiv31 [10]3 years ago

4 0

The correct answer is A.

Developing countries tend to abandon free-trade policies and to establish protectionist measures instead because<u> </u><u>their industries are less productive than the ones from more developed countries.</u><u> </u>

If developing countries let their industrial sector to freely compete in the global markets, their industries would be <u>the least productive and forced to close down. Therefore, commercial barriers are set in order to protect them and give them time to grow by just serving the domestic market,</u> time to achieve efficiency gains and to adopt productive technologies so that maybe after a while they are competitive enough to go international. Moreover, charing tariffs constitutes an important economic revenue for developing countries.

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