International trade is the exchange of goods, services and capital between countries. This type of trading has existed for centuries, but it is experiencing resurgence due to economic globalization. The international trade theory is the branch of economics that studies models of international trade and standby letter of credit Dubai. Over the past two decades, international trade has greatly increased, especially for developed countries and newly industrialized countries, promoting the growth of the latter.
The least developed countries such as Zimbabwe have not experienced such an increase in cross border trade. The volume of world trade increased fifteen-fold from 1950 to 1960 and has tripled between the fall of Berlin Wall and 2010. Regional agreements are of different types, each reflecting different degrees of economic integration.
Trade motivation occurs even if one country has an absolute advantage in production of all goods. Development of international trade leads to equalization. Some products go through a cycle consisting of five stages: product development. Sales growth slows down, as the bulk of consumers are already involved.
It’s finally noted that the establishment of regional economic spaces reduces the number of negotiators at WTO meetings (the European Union is represented for example as a member of the organization), which may facilitate agreements, allowing the development of economies in a protected environment. Regionalism can be a preliminary step to multilateralism, allowing some countries to take insurance.
Since the 1990s intra-regional trade has increased within NAFTA from 42 to 54% of total exports of member countries. In Mercosur, this figure rose from 9 to 20% over the same period, while in Europe the share of intra-Community trade has made little progress in spite of increasing integration, however, remaining high at 100% in 2006. Before the entry into force of NAFTA in 1994, Paul Krugman questioned the impact of this agreement while some U. S. Politicians predicted the disappearance of hundreds of millions of jobs.
According to him, the scope of such agreements is limited. Indeed, the international customs duties are now about 3 or 4%, which means a low impact of their disappearance. In the case of NAFTA, Mexico’s integration into a free trade agreement with the United States and Canada will primarily help in restoring the confidence of financial investors in countries experiencing economic difficulties. Therefore, irrational behavior of financial actors has little to do with global trade.
New forms of international trade grow as compensation trade giving rise to non-standard contracts in the context of large public contracts (legal definition in Article XVI of Appendix 4b6 Agreement Marrakech in 1994): trade remedies: barter exchange of goods without financial transfer or mention of the value of the transaction. Against – purchase: the purchase or redemption by exporting products importer. To promote exports, many government agencies publish on the internet market research by sector and foreign countries.
This was for instance the case for Britain vis-a-vis the Commonwealth following its entry into the European Union, thus supplanting the imperial preference. More recently, the entry of Eastern Europe countries into the European Union may affect textile imports from Maghreb. They is another creative side flow. They enable collaboration and thus increased specialization of individual member countries increasing global trade. They allow a better understanding and increased knowledge of business partners that brings confidence and ease in trade (for example, it is easier to organize an exchange with the Germans than with the Chinese).
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