Barriers to natural resources trade between France and Germany

Trade Barriers in France and Germany:

The creation of the European Union was fueled by the Franco-German understanding, which was a significant factor in this process. This understanding originated from the Germany, which was a divided nation, economic giant, and diplomatic pygmy, could compliment France, which was a medium economic power despite of its significant global diplomatic presence. Throughout the years, France has developed to become one of the most active players in the global trade regardless of its developed economy. On the other hand, Germany has continued to advance Western Europe's economic integration through lessening and/or removal of barriers to free trade and investment.

Since every country has certain trade barriers that govern its imports and exports, France and Germany also have trade barriers despite of the various initiatives they have adopted with regards to economic integration. In relation to natural resources and/or products, France and Germany actually use some specific barriers. Germany is renowned for regulations and bureaucratic procedures that contain complex safety standards, which are sometimes applied zealously. With regards to its natural resources and/or products, Germany has specific barriers that relate to every category of such goods and resources under agricultural products. Generally, the specific barriers associated with these products are the European Union requirements and standard for a German performance mark or quality ("Trade and Regulations Standards," 2012).

In contrasts, France's natural resources and/or products are seemingly limited in quantity, which contributes to the existing barriers in the country regarding these resources and products. While the liberalization of the market helped to reduce various barriers in the early 1990s, there are various barriers in France that are associated with the need for increased food safety, environmental, and security concerns. Some of the specific barriers in France that are related to these products include the 35-hour legislation and the huge differences in taxation rates.

As evident in the analysis of these two countries, each of them has some trade barriers in relation to the natural resources and/or products just like many countries. Therefore, there is need to overcome these trade barriers from Germany and France through various strategies such as economic integration. Generally, overcoming trade barriers can either be realized through appropriate legislation or loop-holes within the country. Together with international trade, economic integration has been regarded as one of the major ways for overcoming trade barriers through liberalization of the market. However, the ability to overcome trade barriers necessitates considerable investment in resources and time.

France and Germany are major players in the global market that could eliminate the trade barriers through economic integration. Economic integration plays a crucial role in overcoming these trade barriers through promoting and enhancing foreign direct investment. This economic element has a considerable net impact on bilateral foreign direct investment between two countries. The major way with which economic integration contributes to the ability to overcome these trade barriers and enhance foreign direct investment is through reduction of distribution costs of goods (Martinez & Bengoa, 2010).