International trade represents a fundamental pillar for economic development and cooperation between nations. The imposition of tariffs - taxes applied to imported or exported goods - has a significant impact on this scenario, influencing everything from consumer behaviour to diplomatic relations. This is a topic that has been widely debated since Donald Trump assumed the presidency of the United States, constantly referring to the application of tariffs as a means of fostering American economic growth. This article does not seek to discuss the goodness or objectives of applying tariffs, but rather to briefly list some advantages and disadvantages of applying them.
Tariff advantages
Tariffs have the potential to protect domestic industries by making imported products more expensive and less competitive with local products. This practice can:
- Fostering National Industryprotecting strategic sectors;
- Generate Tax RevenueThis is because tariffs contribute to the increase in public revenue;
- Reducing External DependenceThis will allow national products to increase their market share, reducing vulnerability and dependence on foreign markets.
Disadvantages of Tariffs
Conversely, tariffs can also have a number of negative consequences, including:
- Rising Cost of Livingdue to the increase in the price of imported products and raw materials;
- Trade retaliationIt is expected that the affected countries will respond with similar measures, thus provoking trade wars.
In the current scenario, tariffs seem to be more of a political tool than a real factor for economic growth. At a time when international trade is on a global scale, it is especially important to find methods that promote a balance between the legitimate economic protection of the country and international relations, without jeopardising the domestic cost of living.