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Global Trade: Free, or Otherwise

The World Economic Forum (WEF) recently published its 2016 global trade report. Atop the list of trade-friendly economies are Singapore, the Netherlands, Hong Kong, Luxembourg and Sweden. The United States ranks as No. 22.

It appears global trade has greatly enhanced some nations, but it hasn’t benefitted all participants equally. Per campaign promises, the new Trump administration advocates renegotiating trade agreements to better benefit Americans. However, the complexity and sensitivity of such negotiations could result in a number of different outcomes — and not all of them may be beneficial to the U.S.

The latest WEF report offers a few interesting insights, such as:

  • There is a strong correlation between wealthy and trade-friendly economies
  • Developed countries tend to have lower trade costs than developing ones
  • There is a strong correlation between highly populated countries and lower global trade
  • Trade volume tends to be impacted more by individual country tariff policies and other costly compliance measures rather than size or wealth
  • Non-tariff measures (e.g., labeling, inspections, quotas, embargoes and sanctions), which impact 96 percent of world trade, add more expense to trade costs than tarriffs

As a general rule, free trade enables more competition, which can yield more choices and reduced prices. When a country is concerned that increased trade will hurt its workers or domestic output, the government may impose tariffs and other trade barriers to protect certain industries.

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Danielle Christensen

Paraplanner

Danielle is dedicated to serving clients to achieve their retirement goals. As a Paraplanner, Danielle helps the advisors with the administrative side of preparing and documenting meetings. She is a graduate of the College of St. Benedict, with a degree in Business Administration and began working with Secured Retirement in May of 2023.

Danielle is a lifelong Minnesotan and currently resides in Farmington with her boyfriend and their senior rescue pittie/American Bulldog mix, Tukka.  In her free time, Danielle enjoys attending concerts and traveling. She is also an avid fan of the Minnesota Wild and loves to be at as many games as possible during the season!