Explain the concept of trade retaliation.

Economics Trade Barriers Questions



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Explain the concept of trade retaliation.

Trade retaliation refers to the act of imposing trade barriers or restrictions on another country in response to its trade policies or actions that are perceived as harmful or unfair. It is a form of retaliation or punishment aimed at protecting domestic industries and correcting trade imbalances. Trade retaliation can take various forms, such as imposing tariffs, quotas, or embargoes on specific goods or services from the offending country. The objective of trade retaliation is to create economic pressure on the targeted country, encouraging it to change its trade practices or policies in a more favorable manner for the retaliating country.