The straight literal meaning of "pathology" is "sickness." Here, we understand it to mean "psychopathology," mental illness.
"Dread" means "intense, deep fear."
The writer is saying that all countries have an intense fear of imports, and that this fear is "pathological," i.e. unjustified, insane, crazy.
"Yearning" means "an intense, deep desire or want."
The writer is saying that all countries have an intense desire for exports... and that this desire is also unjustified, insane, and crazy.
He is saying that not only is fear of imports crazy, it is the second-craziest thing nations fear. The only stronger emotion is their crazy desire for exports.
Very like, the writer is saying that trade benefits both nations, and that it is not a zero-sum game in which the exporter wins and the importer loses.