Potential Costs of Adopting a Free Trade Regime - Research Paper Example

Potential Costs of Adopting a Free Trade RegimeFree trade refers to the absence of artificial barriers to the free flow of goods and services between countries (Dunkley, 2004). The barriers are of many kinds: natural, cultural, market, policy or tariffs and service barriers. Adopting a free trade regime involves removing all these barriers in order for goods and services to flow freely. Therefore, the cost is high and comes in multiple forms that range from the environment to the job market.

Implementation of a free trade regime would mean that the environment would pay a high price in the form of destruction through pollution by manufacturers. Having a free trade regime requires more products to be created thus more waste gets ejected into the environment (Scott, 2003). Therefore, the environment would be heavily destroyed countries that manufacture goods for export than those that import. Workers in major importing countries would also pay heavily with their jobs (Scott, 2003). This is because; countries that import more have higher labor and production costs.

These costs need to be cut, and thanks to a free market, their jobs would be moved to countries that have lower production and labor costs.The transfer of jobs to lower cost countries would lead to mass displacement of people (Jie, n.d., para. 2). This would be in order to create more space for manufacturing industries. Agricultural activities would be affected, as farmers’ land would be alienated. The government should intervene as all these issues affect its subjects. They should do so by regulating the disposal of waste and ensure job security.

In addition, they should seek alternative means that lead to reduced production costs. As a result, jobs for many workers would be secured, and the cost of life will not be elevated.In conclusion, free trade regimes usually open borders for free trade, which bring positive impact. However, the price to pay for this is really high, and; therefore, governments should intervene. ReferencesScott, R. (2003). The High Price of “Free Trade” NAFTA’s failure has cost the United Statesjobs across the nation.

Retrieved on 20th June from http://www.epi.org/page/-/old/briefingpapers/147/epi_bp147.pdf Dunkley, Graham. (2004). Free Trade: Myth, Reality and Alternatives. London, United Kingdom: Zed Books.Jie Ma Wen. (n.d.) What Are the Costs of Free Trade? Retrieved from http://www.ehow.com/about_5367523_costs-trade.html