Customs Barrier

DEFINITION of 'Customs Barrier'

Any measure designed to limit international trade. A customs barrier will act to limit the level of trade across international borders by implementing restrictions on imports and/or exports. Governments may impose such restrictions in order to protect a domestic industry from foreign competition, or to limit the export of goods or services deemed vital to a domestic economy's health.

Also known as a "trade barrier".

BREAKING DOWN 'Customs Barrier'

Types of customs barrier can include tariffs, levies, duties and trade embargos. While most economists are in agreement that such measures ultimately create less-than-optimal economic conditions, governments often resort to them for a variety of reasons, ranging from protecting an infant industry to engaging in a trade war with another country.

RELATED TERMS
  1. Quota

    A government-imposed trade restriction that limits the number, ...
  2. Nontariff Barrier

    A form of restrictive trade where barriers to trade are set up ...
  3. Export Incentives

    Monetary, tax or legal incentives designed to encourage businesses ...
  4. Tariff

    A tax imposed on imported goods and services. Tariffs are used ...
  5. Export

    A function of international trade whereby goods produced in one ...
  6. Balance Of Trade - BOT

    The difference between a country's imports and its exports. Balance ...
Related Articles
  1. Term

    Growth and Politics In Exports

    An export is a good or service that is shipped from one country to another for sale or trade.
  2. Economics

    The Basics Of Tariffs And Trade Barriers

    Everything you need to know - from the different types of tariffs to their effects on the local economy.
  3. Economics

    What are Barriers to Entry?

    A barrier to entry is any obstacle that restricts or impedes a company’s efforts to enter an industry.
  4. Professionals

    Trade Restrictions

    CFA Level 1 - Trade Restrictions. Learn how trade restrictions affect the economy. This section covers arguments favoring trade restrictions and why they are often adopted.
  5. Economics

    Tariffs

    Tariffs, or customs duties, are taxes imposed on foreign goods and services. In addition to providing a country with additional revenue, tariffs offer protection to domestic producers. Imported ...
  6. Term

    Understanding Net Exports

    Net exports are the difference between a country’s exports and imports.
  7. Economics

    Interesting Facts About Imports And Exports

    Imports and exports exert a profound influence on the consumer and the economy. Learn what affects these figures, and in turn how these figures affect the economy.
  8. Economics

    How Imports And Exports Affect You

    Imports are an important indicator of an economy’s health. In a healthy economy, exports and imports are both growing.
  9. Economics

    Understanding Imports

    An import is a good or service that’s brought into one country from another.
  10. Professionals

    International Economic Factors

    FINRA Series 6 Exam Study Guide - International Economic Factors. This section discusses international factors such as currency exchange rates, balance of trade (BOT) and Balance of Payments.
RELATED FAQS
  1. How do tariffs protect domestic industries?

    Understand the four ways tariffs are used by domestic government to protect its domestic industries. Learn how tariffs are ... Read Answer >>
  2. What are common reasons for governments to implement tariffs?

    Gain a basic understanding of a government-sanctioned import tariff, what it is meant to accomplish and common reasons for ... Read Answer >>
  3. What risks do organizations face when engaging in international finance activities?

    When an organization decides to engage in international financing activities, they also take on additional risk as well as ... Read Answer >>
  4. How do tariffs protect infant industries?

    Find out why some economists believe that developing markets need protective import tariffs to promote domestic industry, ... Read Answer >>
  5. What is a trade deficit and what effect will it have on the stock market?

    A trade deficit, which is also referred to as net exports, is an economic condition that occurs when a country is importing ... Read Answer >>
  6. How can tariffs cause inefficiencies in domestic industries?

    Understand what a tariff is and why a government would want to impose a tariff. Learn how tariffs can contribute to domestic ... Read Answer >>
Hot Definitions
  1. Cost Of Debt

    The effective rate that a company pays on its current debt. This can be measured in either before- or after-tax returns; ...
  2. Yield Curve

    A line that plots the interest rates, at a set point in time, of bonds having equal credit quality, but differing maturity ...
  3. Stop-Limit Order

    An order placed with a broker that combines the features of stop order with those of a limit order. A stop-limit order will ...
  4. Keynesian Economics

    An economic theory of total spending in the economy and its effects on output and inflation. Keynesian economics was developed ...
  5. Society for Worldwide Interbank Financial Telecommunications ...

    A member-owned cooperative that provides safe and secure financial transactions for its members. Established in 1973, the ...
  6. Generally Accepted Accounting Principles - GAAP

    The common set of accounting principles, standards and procedures that companies use to compile their financial statements. ...
Trading Center