The people, their skills – inherent and learnt, availability of raw material, climatic conditions give countries an advantage over others. This is another reason that necessitates Foreign Trade. Economic Development There is often diversity in the economic growth rate of different countries. While some countries are developed, some are underdeveloped and some others are developing. Underdeveloped and developing countries depend on for capital which further increases the need for Foreign Trade.
Introduction In the differing economy we live in today, going worldwide is basic to command the market. Globalization and universal business has made organizations exceptionally effective in their ventures. Globalization can be defined as interdependent relationship among people from different parts of the world divided into nations. This idea helped in advancing residential firms to end up being expansive multinational organizations. A lot of people from various nationalities with various foundations and experience are employed by companies, making a worldwide domain which prompts to having differing encounters, roughly all organizations take part in universal business which is business exchange, for example, deals, ventures and transportation that happen between at least two nations.
An economics field of study that applies both macroeconomic and microeconomic principles to international trade, which is the flow of trade among nations, and to international finance, which is the means of making payment for the exchange of goods among nations. International economics studies the economic interactions among the different nations that make up the global economy. Often this interaction is viewed in terms of the domestic economy and the foreign sector. The key economic principle underlying international economics is the law of comparative advantage. International economics is growing in importance as a field of study because of the rapid integration of international economic markets.
GLOBALIZATION DRIVERS WHICH INFLUENCE INTERNATIONAL TRADE GLOBALIZATION • Globalization is a process of interaction and integration between people, organizations and governments of different nations driven by international trade and investment aided by information technology generating interdependence of economic and cultural activities. This process has effects on the environment, culture, political systems, economic development and prosperity not forgetting the societies well being around the globe. • For many years, people and organizations have been buying from and selling to each other across borders, for example the Silk Road across Central Asia that connected China and Europe during the Middle Ages.
In the contemporary society, there are an increasing number of people involved in the globalisation. I choose the topic of international trade. And in the following paragraphs, I am going to introduce what is international trade, other possible benefits of trading globally and the bottom line. (Heakal 2015) Thanks to the international trade that allows us to expand the market for goods and services. And also, as a result of international trade, the market contains greater competition with more competitive price and cheaper products.
They generate the demand for high quantity of standardized product. For example, the retailers such as IKEA, and Wal-Mart. They purchase items in large quantity then they get benefit from low price. 3-Global market channel Indicate the distribution of certain type of product using worldwide way, will reduce cost of handle different distribution requirement. However, supply chain around the world have been created to take the benefit of source opportunities, and establish distribution channel.
As such, it is characterized by increasing social and economic openness and growing interdependence between the countries of the world. In economic contexts, it refers to trade liberalization or free trade. There are several global issues and concerns like poverty, bio-diversity, environmental protection, sustainable development and international security and cooperation which require global action and solution. All such issues instigate different countries to come closer to one another. Drivers of Globalization In general, globalization represents the increasing integration of the world economy, based on five interrelated drivers of change: • International trade (lower trade barriers and more competition) • Financial flows (foreign direct investment, technology transfers/licensing, portfolio
Different countries of the world specialize in producing different goods are referred to the international specialty. Trade policy formulation and implementation covering issues such as taxes, subsidies, customs and administration. In conclusion, it can be stated that, economic growth contributed by international trade, which provided by the policy measures and economic infrastructure are enough to cope with the changes in social and financial scenario that result from it. KEY WORDS: International Trade, Economic Development, Economic Growth. Introduction There is a mutual interdependence of the various national economies in the current world.
The variety of products produced by different country will improves the quality of life of the consumers since the consumers gets an opportunity to consume a large variety of goods or services. It will also automatically encourages countries to compete with each other in the production of different kinds of goods or services at low cost of production which will makes competitiveness stimulates the productivity. It will boost the domestic competitiveness through the export and import activity which will provides a good chance to increase the competitiveness within the domestic markets. Besides, the more variety of the product produced, the more competitiveness and also the tension between each producers will also increase. It might lead to a very strict and challenging competition in the international market which will potentially bring to the positive and also negative possibilities as the impact of
Globalization refers to the growing interdependence of countries resulting from the increasing integration of trade, finance, people, and ideas in one global marketplace (WTO). The importance of international trade cannot be over emphasized. The U.S Department of Commerce stated “The United States is by far the world’s largest exporter of services, and America’s globally competitive service industries-including audiovisual, banking, energy services, express delivery, information technology, insurance, and telecommunications-benefit immensely from opportunities abroad. This has become possible due to advance in communication technology, transportation and management. Management is the art of getting things done through the efforts of other people, by