International Trade And Its Turn With Globalization

With rap globalization taking place, international trade and ventures into foreign markets are becoming more widespread. With economic unions such as the EU existing in the current world economy, free trade is becoming more common. International trade provides many benefits to the countries involved and contributes towards the world economy. International trade usually takes place on the basis of comparative advantage, which means the country which can produce a product at the lowest opportunity cost will undertake that production and will be responsible for exporting customs clearance agents Sydney that product to the country acting as the customer.

International trade enables businesses to become more competitive as they enter foreign markets. With the rise of multinationals and outsourcing of production processes, the unemployment rate in third world countries will fall as production plants are often based in countries which provide cheap labor. Therefore it can be said that international trade creates jobs. In addition to this, consumers will be able to enjoy a larger variety of products from all over the world.

This will also lead to more technological innovations, leading to more cost effective and efficient production processes as well as new and technologically advanced products. However, international trade can also pose problems. For one, if a country imports more than it exports, its current account on its Balance Of Payments will suffer as more foreign currency is leaving the country than coming into the country. International trade can also discourage domestic producers as consumers would opt for higher quality foreign products with customs broker.

This is especially true in situations of dumping, which a term is used to describe the act where a country exports its products to (most often), a developing country for a very low price. International trade may also give rise to illegal substances being imported or smuggled into the country. It is for this purpose that a government will take steps to appoint a Border Protection agency, which will then appoint a customs broker or brokers to check the incoming shipments and ensure that everything is in order. The government will also impose tariffs, trade embargoes and involve a lot of red tape when receiving imports.To ensure smooth processes of international trade, the first step is to ensure that the countries have a stable trade agreement. It is then each government’s responsibility to decide upon the trade protection strategies that are to be incorporated, if any.