Meaning of trade diversion | Babel Free

Definitions

The changing of import sources as a result of political agreements, rather than to increase mutual benefit.

countable, negative, uncountable, usually

Examples

“Even if trade diversion is not important in aggregate terms or in relation to trade creation between the bilateral partners, it still represents an inefficient use of global resources[…]”

“First, the lowering of trade barriers among members leads to trade diversion from outside suppliers to firms in member countries[…]”

“An excessive increase in the share of intraregional flows is typically taken as an indication that trade diversion has been predominant and the regional integration programme has been welfare-reducing.”

CEFR level