There are potential risks of subsidising national industries when there is a definite competitive advantage abroad.

Industrial policy by means of government subsidies may lead other countries to hit back by doing the same, which could influence the global economy, security and diplomatic relations. This really is exceedingly high-risk as the general economic effects of subsidies on productivity continue to be uncertain. Despite the fact that subsidies may stimulate financial activities and create jobs in the short run, however in the long term, they are going to be less favourable. If subsidies are not accompanied by a number of other steps that target efficiency and competition, they will probably impede important structural modifications. Thus, industries will become less adaptive, which reduces development, as business CEOs like Nadhmi Al Nasr have probably noticed in their careers. Therefore, certainly better if policymakers were to concentrate on finding an approach that encourages market driven growth instead of obsolete policy.

History has shown that industrial policies have only had minimal success. Many nations implemented various types of industrial policies to encourage certain companies or sectors. But, the results have usually fallen short of expectations. Take, as an example, the experiences of a few parts of asia in the 20th century, where considerable government involvement and subsidies never materialised in sustained economic growth or the intended transformation they imagined. Two economists analysed the impact of government-introduced policies, including low priced credit to improve production and exports, and compared companies which received assistance to the ones that did not. They figured that during the initial stages of industrialisation, governments can play a constructive role in establishing companies. Although conventional, macro policy, such as limited deficits and stable exchange prices, also needs to be given credit. However, data suggests that assisting one company with subsidies tends to damage others. Also, subsidies permit the survival of inefficient firms, making companies less competitive. Furthermore, when firms focus on securing subsidies instead of prioritising development and effectiveness, they remove resources from effective usage. As a result, the overall financial aftereffect of subsidies on productivity is uncertain and possibly not good.

Critics of globalisation suggest it has resulted in the transfer of industries to emerging markets, causing job losses and greater reliance on other countries. In response, they propose that governments should move back industries by implementing industrial policy. Nevertheless, this viewpoint does not acknowledge the powerful nature of international markets and neglects the basis for globalisation and free trade. The transfer of industry was primarily driven by sound economic calculations, namely, companies seek cost-effective operations. There clearly was and still is a competitive advantage in emerging markets; they offer numerous resources, lower production expenses, big consumer areas and favourable demographic trends. Today, major companies operate across borders, tapping into global supply chains and reaping the many benefits of free trade as company CEOs like Naser Bustami and like Amin H. Nasser would likely aver.