Trade Policy: Free Trade versus Protection

Merertu Wakuma; Mammo Muchie

Merertu Wakuma School of Mechanical and Industrial Engineering, Addis Ababa institute of Technology, Addis Ababa University, Addis Ababa, Ethiopia
Mammo Muchie DST/NRS Research Professor of Innovation Studies, Tshwane University of Technology.

Keywords: Trade is an engine for the economic growth of most of the countries over the world. Trade policies have played a vital role in the development of the international division of labour with some becoming dominant and others dominated. Since the end of Worl

Abstract

Trade is an engine for the economic growth of most of the countries over the world.Â Trade policies have played a vital role in the development of the international division of labour with some becoming dominant and others dominated. Since the end of World War II in 1945, globalization has advanced broadly and international trade has been greatly facilitated by agreement among trading countries on a set of rules for international trade. A country can have its own trade policy whether it is free trading or employs protectionism policy depending on the countryâ€™s industrial and economic development. In this paper a literature review has been done on both trade policies to summarize their advantage and disadvantage if a country chooses to follow one of them. Then and their implication of trade policy in the respective textile and apparel industry has also been reviewed