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With the advent of globalization, international trade has seen a marked increase, particularly in the last few years. This form of trade is essential if a country wants to maximize its capacity to produce and acquire goods. Besides, international trade gives rise to a world economy, in which prices, or supply and demand, are affected by global events. Political change in Asia, for example, could result in an increase in the cost of labor, thereby increasing the manufacturing costs for an American shoe company based in Malaysia, which would then result in an increase in the price of the tennis shoes offered by the company.
Global trade allows wealthy countries to use their resources - weather labor, technology or capital - more efficiently. Because countries have different assets and natural resources (land, labor, and technology), some countries may produce the same good more efficiently and therefore sell it more cheaply than others. If a country cannot efficiently produce an item, it can obtain the item by trading with another 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 (FDI). FDI enables economies, particularly those of developing countries, to grow.
Under this category, Links4real has given resources that discuss International Trade in more detail. Through our links, we have also tried to shed light on trade statistics for the year 2008.
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