TRADE BARRIERS IN EUROPE Though there are many benefits to voluntary trade, governments will sometimes use trade barriers to limit what can be traded to their people, and with whom their people can trade. A country might impose a tariff, or tax, on imports of certain products. The tariff makes the imported good cost more. When countries outside of the European Union (EU) want to sell their goods in the European Union, they must pay tariffs. Countries within the EU do not have to pay a tariff on goods they buy or sell to another EU country. If a U.S. company wants to export fruit to a country in the EU, the U.S. company must pay a tariff first. Import quotas are another type of trade barrier. Quotas limit the number of goods that can be imported from a certain country. The EU places a quota on the amount of steel that can be imported from certain countries. The effect is similar to a tariff because it makes steel from those countries harder to get, and thus, more expensive. That can help steel producers within the EU sell more steel. An embargo, or ban on trade with a certain country, is normally put in place for political reasons. In recent years, the EU began placing embargoes on the sale of certain weapons and other technologies to Iran. This was done because the countries of the EU suspected that Iran was trying to build a nuclear weapon. The EU countries hope that their embargo will make it more difficult for Iran to build this type of weapon. Many countries are working to remove trade barriers, with the hope that increased trade will benefit their economies. One of the main goals of the EU is to remove tariffs and quotas between member nations. European nations also work with the World Trade Organization (WTO). This global organization is dedicated to the goal of removing trade barriers among all of its 153 member nations. Name Date QUESTIONS – TRADE BARRIERS IN EUROPE 1. Why do countries use trade barriers? 2. A tax on imports is known as a _______________. 3. Tariffs make goods that are imported cost ____________. 4. A limit on the amount of goods that can be imported from a country is known as a _______________. 5. A ban on trade is known as a ____________________. 6. Why would a country place an embargo on a country? 7. What is a major goal of the WTO? 8. How many countries (nations) in the world belong to the WTO?