Corruption is a Costly "Hidden" Tariff

Source: Global Trade

Hidden costs

Tariffs, quotas and sanctions are all overt hurdles to free trade that increase the costs of commercial exchanges or even prohibit them. But not all barriers to trade are written down in law or even apparent on the surface. Some lurk in the form of money changing hands under the table.

The Organisation for Economic Co-operation and Development (OECD) in a recent report identified corruption as one of the most costly non-tariff barriers in global trade, particularly for low and low-middle income countries. Acting as a “hidden tariff,” a lack of integrity in trade can be just as damaging to trade relations as any legalized restriction.

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