Christian Gerard C.

Araña BID 1A-2

The negative effects of free trade to the

economy of the states

Free trade is when two or more nations form an agreement where they will lower their
national barriers for them to import and export their products freely. Under a free trade
policy, there are little to no government tariffs, quotas, subsidies, or prohibitions that
prevent the exchange of products and services across international borders.

It may be a good idea for the economies of countries at first but there will always be
downsides to every decision the government makes. It may be called "free" trade but not
"fair" trade. These are some of the negative effects of free trade on the economy of
countries:

Job Losses
Labor and Environmental Abuse
Pollution
Unfairness
Unbalanced Systems

As free trade is less regulated, various cost-cutting measures are often applied in order
to ensure that overheads are reduced and profits are maximized. Economic efficiency
might be beneficial for the economy as a whole in the long run, but that doesn't help the
workers who lose their job in the short term. Free trade makes a nation's overall
economy more productive, but it is a bad deal for individuals or small groups of people
who will lose their jobs in return. With the lack of manpower to work for companies,
those people who are left are being abused with their energy to work harder and longer
for only little pay to make sure that companies will have more profit. Since free trade
offers an unrestricted amount of trade, companies tend to export more goods than what
only needs to be exported, pollution also increases, from increased air pollution to
increased pollution in waterways as enormous volumes of goods are shipped around the
world; the container ships release sulfur dioxide and heavy metals into the oceans,
which then enter our food chains. Trade barriers might create opportunities for
corruption, but so do free trade agreements. Economists may envision a society where
trade barriers vanish entirely, but free trade agreements are negotiated and signed by
politicians with their own interests to worry about. As a result, the agreements usually
are immense documents full of loopholes and rules that create big advantages for
established businesses.