EXPORT PROMOTION VS IMPORT SUBSTITUTION

Export Promotion vs. Import Substitution

Export Promotion vs. Import Substitution

The First Stage of Import Substitution:         

        All present day industrial and developing countries protect their manufacturing industries for the domestic markets. While the industrial countries of today rely primarily upon the usage of relatively low tariffs, developing countries apply high tariffs or quantitative restrictions which either limit or completely exclude competition from their imports. Protection like that - high protection - discriminates against exports through the explicit/implicit taxation of the export activities.

Explicit taxation can take the form of export taxes whereas implicit taxation occurs as a result of the ...