The imposition of the national tariffs on trade and business ventures in a country contributes to high rates of poverty in a country. Milanovic explains that the reduction of national tariffs in a country would help improve the development state in a country (Milanovic 667). The national tariffs make help a country raise the income, but high interests discourage investors thus hinders growth and development of a country. Research proves that most countries with high taxation rates and tariffs have fewer development projects and have high numbers of unemployment. Poverty has spread across the world, and it hinders the development of the country unless there are measures to help counter the factors that lead to the persistent state of poverty. The high tariffs make it difficult for the local currency to pick up against the other international currencies. For instance, the American dollars and the United Kingdom pound appear as the constant currency across the world. A poor country would have to make considerable tariff rates to attract investors from the first world countries to help lower the foreign money.
Each country has to invest in trade and business both the local and across its borders to gain capital that would help lead to the growth of the nation. The countries that face high rates of poverty have to open their borders and indulge in a trade with the neighboring countries. For instance, the country majorly produces agricultural products would require a larger market and opening its national borders would widen its target market. Opening the national borders has affected most countries since leaders want to avoid foreign commodities from flooding the local markets (Hulme & Shepherd, 414). The leaders forget that opening of the national borders would attract investors and even offer markets for the surplus products of the country. Most of the third world countries have the highest numbers of poor people because they do not want to indulge in a trade with foreign nations.