How has liberalisation of trade and investment policies helped the globalisation process?

Trade liberalisation refers to the removal or reduction of restrictions on the free exchange of goods between nations. These barriers include tariffs (duties and surcharges) and non-tariff barriers (such as licensing rules and quotas).

1. Removal of these barriers helps in reduction of cost of goods. This reduction in regulatory costs benefits consumers and businesses alike.
2. Trade liberalisation fosters competition from abroad. As foreign goods enter the market, domestic firms face competition and become more efficient and produce goods at lower costs. This competition can lead to greater efficiency and innovation making them future exporters.
3. The outcome of trade liberalisation is greater integration among countries, which is a fundamental aspect of globalisation. As trade barriers are reduced, countries become more interconnected economically.