International Trade
Essay Preview: International Trade
Report this essay
International Trade
Understanding the culture in a country or region in which you are doing business is a critical skill for the international business person. Without this knowledge, a successful outcome to the business venture can be in jeopardy.
“The level of world output in any given year influences the level of international trade in that year.” By this it means that the slower the world economy is the less international trade and the higher the economy the higher the volume of trade.
“Globalization” is a term that came into popular usage in the 1980s to describe the increased movement of people, knowledge and ideas, and goods and money across national borders that has led to increased interconnectedness among the worlds populations, economically, politically, socially and culturally. Although globalization is often thought of in economic terms, this process has many social and political implications as well. Many in local communities associate globalization with modernization. At the global level, globalization is thought of in terms of the challenges it poses to the role of governments in international affairs and the global economy.
There are heated debates about globalization and its positive and negative effects. While globalization is thought of by many as having the potential to make societies richer through trade and to bring knowledge and information to people around the world, there are many others who perceive globalization as contributing to the exploitation of the poor by the rich, and as a threat to traditional cultures as the process of modernization changes societies. There are some who link the negative aspects of globalization to terrorism. To put a complicated discussion in simple terms, they argue that exploitative or declining conditions contribute to the lure of informal “extremist” networks that commit criminal or terrorist acts internationally. And thanks to todays technology and integrated societies, these networks span throughout the world. It is in this sense that terrorism, too, is “globalized.”
Increasingly over the past two centuries, economic activity has become more globally oriented and integrated. Some economists argue that it is no longer meaningful to think in terms of national economies; international trade has become central to most local and domestic economies around the world.
Among the major high-income economies, sometimes referred to as the Organization of Economic Cooperation and Development (OECD) countries, 60 percent of the total economic production, or GDP, is associated with international trade. Thirty-four percent comes from trade between high-income and low-and middle-income nations. The final six percent of the total world trade comes from the merchandise trade between low-and middle income nations. This shows the low purchasing power of the worlds poorest nations and indicates their general lack of economic development. Economists project that, in the U.S., more than 50 percent of the new jobs created in this decade will be directly linked to the global economy.
The World Trade Organization (WTO) is the only global international organization dealing with the rules of trade between nations. At its heart are the WTO agreements, negotiated and signed by the bulk of the worlds trading nations and ratified in their parliaments. The goal is to help producers of goods and services, exporters, and importers conduct their business.
There are items in the U.S. I think we take for granted. Things we use everyday that if all international trade was stopped we would suffer for a short period, but none the less we would be without. In the United States we produce items that other countries need in order to produce products that they need. One example of something manufactured in the United States, is that of items for missile defense systems and airplane parts. “Lockheed Martin Corporation was formed in March 1995 with the merger of two of the worlds premier technology companies, Lockheed Corporation and Martin Marietta Corporation. In 1996, Lockheed Martin completed its strategic combination with the defense electronics and systems integration businesses of Loral.”
“Lockheed Martin traces its roots back to the early days of flight. In 1909 aviation pioneer Glenn