Entry barriers

In some countries, the cost of manufacturing is very low due to the low cost of raw material, manpower and government subsidies. These countries are able to export their products at a very low cost.

The manufacturers in countries which import these cheap products are not able to compete, as a result of which the industry is destroyed. The manufacturers association will lobby the government to impose an anti dumping duty, an import tax, which makes the imports prohibitively expensive and protect the local industry.

Compared to software and internet, the entry barriers for any manufacturing related operation are very high.  Thousands or millions of dollars have to be spent on procurement of land, equipment, installation of equipment and raw material, before a product is actually manufactured and sold.  Permission has to be taken from several government organisations.  Economies of scale make it easier for large companies to manufacture a product cheaply by using automated systems.