Free markets are a threat to developing countries

The term ‘Free trade’ is with regard to all the countries of the world collectively considered as one global market, thus, meant to eliminate unfair barriers to global commerce and raise the economy in developed and developing nations alike. However, both apparent and feared repercussions can create a grave mistrust on the part of workers who believe their country is giving foreign producers an unfair advantage and costing domestic jobs. The main objective of free trade brings about a thick line of gap between the

countries, wealthy in resources and the developing countries that tend to depend on them for production. At the time when a country forms, or is developing at a very slow pace, thus giving rise to only local markets in the present , would identify no potential to set up domestic markets for, free trade steps a level ahead and directly puts them on a globally competitive spirit.

I would like to introduce to you my first point regarding the decreased levels of self sufficiency, thus giving rise to more dependence on various countries. Expansion in market, often makes developing countries more economically dependent on other countries or vice versa for the fulfillment of production needs. The availability of one resource or service makes a country more prosperous as it attracts consumers from all over the world. Specialisation, therefore, is directly related to better development in any country. Yet, the economic dependence that we tend to have, might as well not function at all times, when the country that we depend on, faces scarcity or is in a state of debt. The dependent countries will have to do without the product or service, due to them being directly dependent on the producers . In context of the point, the growth of the developed countries can also fluctuate at times, this is the case, if the demand for their good decreases in the market. This gradually leads to a decrease in their national income thus affecting their rate of development . Hence, it can be concluded that dependence of countries on each other is likely to break the flow of trade in a developed country as well.

With regard to my second point I develop our stance as, “free trade often disturbs the functioning of local markets within countries”. In the case of a developing country, which has just begun to give rise to or develop trade within the country are often vulnerable when looked at from a bigger perspective. Developed companies have large scale industries, with great distribution networks, and more numbers of exports. When the market is considered in terms of a free market, it causes turbulence in the sectors of the domestic economy of the country. Developing countries with slow rise in businesses and markets are placed at the same level as big chains such as Walmart etc, thus crippling the domestic markets where there is no scope for a country to develop.

If looked at, from the aspect of domestic markets being the producers, they can only manage to sustain in a growing economy if their resources are extensive. With the rise of markets in developed countries that have already established relations in an attempt to expand their business even further, they causes more harm to the local markets. As a result, due to no profits being made from their side, it leads to the developing countries trying to cut down the costs in order to gain price advantage. The case in the country becomes critical when their workers are paid low wages, face substandard working conditions and even forced labor. This term is referred to as ‘race to the bottom’ meaning that the country begins to cut down costs at the expense of human rights.

Here the definition of what a free market is, can be contradicted as it isn't proving fair for every country, because of the growth in markets being directly proportional to the development in the country. The world trade organisation notes developing countries insist any attempt to include working conditions in trade agreements is meant to end their cost advantage in the world market.

To sum up, the birth of innovation and ideas mark the rise of the domestic sector in the economy, free trade tends to cripple them by directly putting them at a level in which they have to compete globally. Also, dependence of countries can make situations worse at times.

Thank you !

About the author
Hello, this is Srikari from grade 10B. I enjoy public speaking, mainly debates. This was my speech for proposition in the NALSAR university of law, where regional selections were held.