»»Terror Fears Affect International Business
A report from the World Trade Organization explains how the terrorism fears are changing international trade patterns.
WTO says new security measures have imposed additional costs on countries’ economies and on international trade by adding a burden on business travel, transport and investment.
For instance, the report said these measures are boosting the transaction cost of cross-border trade because of higher insurance premiums and additional screening at borders, sea ports and airports. And Most businesses have probably incorporated the security premium into the final cost of goods sold, thereby passing it along to the consumer.
Daniella Markheim, trade policy analyst with the conservative Heritage Foundation, said :
“Depending on the industries, some will have higher costs of doing business. Once you add the terror risks, insurance rates creep up. Those companies who can’t cope will cut back on production and sourcing. Prices will go up and consumers on average will be paying more for what they buy”
(source)
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