Wider market - Once a company engage in international business, the customers of other country will also know the products of the company sells. This will open a wider market to other countries. 2. Economic growth of the business - The economic growth of the business will also increase. This is because the consumer market will increase after the company is engage in international business.
1. The benefits of international trade: Encourage a nation's economy progress: International trade allows a country to utilize its resources to the highest extent. Moreover, different countries possess different kind of resources, so some countries can manufacture and offer same goods at the cheaper price (Heakel, n.d.). In addition, international trades also help to sell the surplus products in domestic market to foreign market which prevent price falling in home market (Patel, n.d.). Lastly, companies can source cheaper and/or better raw materials from import making them more sustainable and profitable.
Globalization provides bigger markets for exporters and they can earn foreign currency which is again more beneficial in comparison to selling a product in domestic market . And domestic businesses need to be more adaptable as countries around the world are different so have to localize the product accordingly. Also, international trade means international transactions, so risks are involved as there are currency fluctuations which can disturb cordial trade
A country must also have a competitive edge in the international market the process of increasing economic integration between countries, leading to the emergence of a global marketplace or a single world market. Depending on the paradigm, economic globalization can be viewed as either a positive or a negative phenomenon. Economic globalization comprises the globalization of production and Globalization markets in my opinion had a positive impact on the world economy
1. Introduction The speed at which knowledge is shared is rapidly increasing in today’s global economy and lets the world move closer together. One of the key drivers in this process is global trade: Importing and exporting goods and services is becoming more important, not only for global players, but also for countries, which seek to establish free trade agreements with other nations to import and export as effectively as possible. Erixon held that “Every country with a stake in world trade is now negotiating bilateral free trade agreements”, describing the current demand such contracts (Erixon, 2013, S. 18). Free trade agreements are pacts made between two or more countries with the main intention of increasing trade, which essentially contributes to growth and more jobs in an economy.
If a country cannot efficiently produce an item, it can obtain the item by trading with another country. This can be a comparative advantage of a country. International trade not only results in increased efficiency but also allows countries to participate in a global economy, encouraging the opportunity of foreign direct investment. This is the amount of money that individuals invest into foreign companies and other assets which leads to growth in employment and revenues and it promotes activity, progress and innovation within an economy and improvements in manufacturing quality for both the
This was in an attempt to increase its profits and revenue. The company developed an international strategy in order to retain a competitive advantage. This was due to the globalization and rapid development of international markets. There was also reduction of trade barriers and tariffs which made the company come up with the said strategy. The company aimed also to benefiting from economies of scale.
The Panama Canal overall plays a large part in the world economy, by allowing the exchange of goods from the U.S. to other countries around the world and vice versa. Maritime transportation is used to ship good globally than any other method, and the Panama Canal plays an important part in the movement of these goods to support the global chain of supply and demand. In the end, the Panama Canal plays a large part in the global exchange of goods, by being a major transportation route for maritime trade. Considering future challenges, the canal will need to deal with even greater expansion for larger ships, issues with current container ships losing goods in their waterways, and ownership of the actual canal. Overall, the Panama Canal’s global trade importance will make facing these challenges vital to the world
Trade is an important stimulator, of economic growth. It enlarges an economy’s consumption capacity, raises the world output, and provides access to scarce world resources, and an access to worldwide markets for products, without which the poor countries would not be unable to grow. The whole basis of international trade, is based on the fact that countries, do differ in their resource endowments, their preferences and technologies, their scale of economies, their economic, political, and social institutions, and their capacities of growth and development. Exports, provide foreign exchange that is, used for importing the consumption goods, intermediate and the capital goods and further this imports of capital goods and intermediate goods can
International trade and economic growth are two concepts that go together, because international trade contributes to the growth of a country’s economy in numerous ways. Some of these ways consist of the effects of imports and exports, specialization, increased productivity and improved infrastructure. The exportation of goods to other countries for example can contribute to the growth of the exporting country by increasing the income of that country. The national economies of some countries are even dependent on and sustained by their exports. For instance, some oil-producing countries depend on the income from the export of crude oil to sustain their nations.