The positive side of international trade is nations are able to obtain goods they cannot produce in their own country The international trade accounts for a good part of a countrys gross domestic product It is also one of important sources of revenue for a less developed country. International trade Is the exchange of services, goods, and capital among various countries and regions, without much hindrance.The rise In the International trade Is essential for the growth of globallzatlom Globalization Is the process of international Integration, a rising from the Interchange of world views, products, Ideas, and other aspects of culture.
Trade contributes to global efficiency. when a country opens up to trade; capital and labor shift toward industries In which they are used more efficiently.That movement provides a higher level of economic welfare. ome Important benefits of International Trade Enhances the domestic competitiveness Takes advantage ot international trade technology Increase sales and profits Extend sales potential ot the existing products Maintain cost competitiveness in your domestic market Enhance potential for expansion of your business Gains a global market share Reduce dependence on existing markets Stabilize seasonal market fluctuations The negative side of international trade is trade barriers, such as, tariffs and quotas to raise the price or limit the availability of imports.Producers may try to restrict the exportation of raw materials to artificially lower the price of their own Inputs. Tariffs are when the imported goods are taxed and quotas block trade by limiting the mount a country can buy Tariffs on Imports will cause prices to Increase and could lead to trade wars.
The goal of the tariff Is to make the price of Imported goods higher than the price of the same good produced domestically Tariffs are much higher in certain sectors such as agriculture and clothing and among certain less developed countries than In others.Many countries have substantial barriers to trade services areas such as transportation and communications, while other countries have policies that welcome foreign competition. Trade barriers affect some countries more than others. Less developing countries are the hardest hit because their exports are concentrated In low-skill, labor-Intenslve products that Industrialized countries often protect when people want the product so badly that higher prices have little effect, countries may set quotas or Ilmlts on the amount ot toreign goods imported.
