There are two opposing opinions regarding whether developing nations should employ high tariffs for industry protection and local industry expansion. Free trade represents the best economic strategy in their opinion. The purpose of this essay is to defend the notion that elevated tariff restrictions strengthen local companies of developing nations as they advance their economic power.
High tariffs act as shields which defend domestic small companies from being overtaken by large foreign businesses. Developing nations lack the capability to match their production levels with those of well-to-do countries. These big international companies maintain low product prices damaging the operations of both local factories and retail businesses. National businesses flourish when high tariffs are enforced against foreign commercial items because this shields them from heavy international market competition.
The implementation of tariffs enables the creation of new job opportunities within the economic system. An increase in local business operations creates a need for additional labor force. The employment rate rises with more citizens obtaining paid work. The government benefits from higher tax payments from the increased number of taxpayers who can utilize this income for educational institutions as well as hospitals and road infrastructure. The country’s future development becomes stronger as well as more independent because of these operations.
Some citizens maintain that if tariffs become too high consumer products will become more costly. The need for local business growth takes precedence in developing nations above all else. The government must start by nurturing local industries until they demonstrate adequate strength before setting in motion a process of tariff adjustment to welcome foreign trade.
High tariffs enable developing countries to develop their industries which leads to job creation while helping nations increase their economic self-sufficiency. The initial stage of development exhibits greater advantages over the disadvantages of high tariffs. Developing countries must implement high tariffs to foster their home economy.