Trade Issues Between Developed and Developing Nations

Trade Problems 1 Trade Issues between Developed and evolution Nations Friday, January 22, 2010 Trade Problems 2 There be trade problems that exist for a less developed acres when trading with a more(prenominal) developed nation. These trade problems can prevent the less developed nations from increase possible gains from international trade. Some of these problems are temporary and resolved in time, while others are more stubborn and unable to be resolved.I ordain discuss the type of issues developing nations come crossways when trading with developed nations. ontogenesis countries participating in trade lack an organized and strong pecuniary policy. Developing nations have problems forecasting money demand. Central banks have problems keeping records for managing monetary policy because the banks are not independent of the government. Some developing countries adopt policies such as dollarization, which allows for financial stability and take down inflation.Inventory problem s in developing nations are another issue. In developing countries, inventory may be agricultural products instead of industrial products. Most of the inventory problems have to do with the food security and nutriment of the people. Developing nations have to stabilize food prices and production. They also have to balance the domestic and imported give of agricultural products. In Mexico, befoulment has increased since NAFTA was signed into law and trade between the U. S. and Mexico began.Despite its governments initial attention to Trade Problems 3 environmental issues associated with economic growth, the government did not follow through on its intentions to take care of the environment. In 1994, real spending on environmental protectiondeclined 45% (Gallagher, 2004). Further, inspections trim down by 45% over the same period (Gallagher, 2004). Ten years later, in 2004, there is vigor to suggest that pollution has decreased. If Mexico does not act on protecting its environmen t, further environmental degradation will continue.With Mexicos comparative advantage of an abundance of unskilled labor, most firms will stay tightlipped to their production markets and pay the costs of environmental regulation, which are small, compared to relocating their businesses elsewhere (Gallagher, 2004). Knowing implementing regulations and enforcing them will not risk direct foreign investment is one of the most important reasons why Mexico can and should reduce pollution and other environmental degradation within its borders (Gallagher, 2004). Trade Problems 4 ReferencesBigman, D, (1986, February). The Journal of the Operational interrogation Society, Research on Inventory Problems in Developing Countries. Retrieved Friday, January 22, 2010 from http//www. jstor. org/pss/2582717 Gallagher, K (2004, September). Free Trade and the Environment Mexico, NAFTA, and Beyond. Retrieved Friday, January 22, 2010 from http//ase. tufts. edu/gdae/Pubs/rp/NAFTAEnviroKGAmerProgSep04. pdf Wikipedia, (2010, January). Monetary Policy, Developing Countries. Retrieved Friday, January 22, 2010 from http//en. wikipedia. org/wiki/Monetary_policy