Demerits (Disadvantages/Arguments against/Negative role) of international   trade

1. Dumping problem. International    trade encourages   dumping   which   retards   the development    of local infant industries in the countries where the commodities   are dumped.

Note. Dumping refers   to the selling commodities   in foreign markets   at lower prices than the price charged in the domestic market.

2. Increase in economic dependence and reduction in self-reliance. It encourages   the dependence syndrome  in countries  most  especially  for developing   countries   which  have  to depend  on imports from developed  countries  in form of consumer  and capital  goods.
3. Imported inflation. It leads to imported   inflation   especially   when imports   are bought at higher prices from countries experiencing   inflation.
4. Balance of payment problems. It results  into unfavorable   balance  of payments  That  is when  the country  spends  more  on imports  than  what  it receives  from  exports.  This is true for Uganda as it imports expensive manufactured   goods and exports primary or agricultural   products.                        .
5. It worsens the terms of trade for the  country  when  the  import  prices  are  higher  than  exported prices.
6. It encourages  the importation  of dangerous  and harmful  products  to  the  country   in  form  of drugs,  pornographic   materials  etc.  Such products may adversely   affect the country economically, culturally and socially
7. Demonstration effect. International  trade encourages   demonstration    effect where by local people tend   to consume   luxurious    expensive    commodities    from   foreign   countries    and   neglect    the domestically   produced goods.  This undermines   the growth of local infant industries.
8. It encourages brain drain. Brain drain refers to the massive  movement   of skilled labour from one country to another especially   from developing,   to developed   countries.   This leads to lack of skilled manpower   in the developing   countries.
9. It leads to political instabilities especially  in developing   countries.   This is because   they import fire-arms   and military    hard ware   from developed   countries.   This   contributes   to under development   of developing countries.
10. It perpetuates political ties and economic dominance by developed on to developing   countries. In this  case  developing   countries  have  to accept  political   and  economic   policies   from  developed countries  which  may not be in their  line of development.
11. It leads to under development and collapse of local infant industries as they are exposed to foreign  competition   in  form  of  high  quality  imported commodities    as  compared   to  the  locally produced  domestic  products.  This undermines   the countries need to industrialize.
12. It acts as disincentive to work  for  the  local  people   since  they  are  assured   of  the  supply   of commodities   from  foreign  countries  in form of imports.  This discourages   production   activities   in the country.
13. It promotes international inequalities where by developed countries   benefit   more as compared to developing    countries.   This   is because   developed    countries   produce    and export   expensive manufactured   products   while developed   countries produce and export cheap primary products   to developed   countries.