International Trade
“ International Trade and Foreign Direct Investment - an economic analysis”
Table of Contents 1) Introduction 2 2) International Trade 2
2.1 Major Flows & Trends 2010 2
2.1.1 Merchandise Exports 2 2.1.2 GDP 2 2.1.3 World Exports and Imports 3 2.1.4 Leading Exporters & Importers 4 2.1.5 Sectoral developments 5 2.2 Explaining the Major Flows & Trends 2010 6 2.2.1 Absolute Advantage 7 2.2.2. Comparative Advantage 7 2.2.3 Hecksher and Ohlin 8 3) Foreign Direct Investment
3.1 Major Flows & Trends 2010 9 3.1.1 Different Performance in different regions 10
3.1.2 Explaining the Major Flows & Trends 2010 11 3.1.3 Theories 11 4) Conclusion 14 5) References 15
1) Introduction
International trade is “ The economic interaction among different nations involving the exchange of goods and services, that is, exports and imports” (Economic Glossary). In this assignment I want to review the major flows from country to country all over the world and what the trends are in recent years.
2) International Trade
2.1 Major Flows & Trends 2010
2.1.1 Merchandise Exports
In 2008 the world was hit hard by a financial crisis which the world suffers from, similar to the Great Depression. After this crisis the World didn’t recover yet fully. Banks released cheap Loans for purchasing new properties without ensuring if the borrowed money could be paid back. Concerning steadily raising property prices, banks increase their interest rates which caused the selling of the houses. After this, the property prices fell and mortgages lost their values, so companies’ investments are not profitable anymore. Due to this fact the trend went down. Nevertheless this was one factor, which cranked up the biggest increase in merchandise export, which was recorded in 2010 which shows an increase of nearly 15 per cent, kept up by an increase in global
Table of Contents 1) Introduction 2 2) International Trade 2
2.1 Major Flows & Trends 2010 2
2.1.1 Merchandise Exports 2 2.1.2 GDP 2 2.1.3 World Exports and Imports 3 2.1.4 Leading Exporters & Importers 4 2.1.5 Sectoral developments 5 2.2 Explaining the Major Flows & Trends 2010 6 2.2.1 Absolute Advantage 7 2.2.2. Comparative Advantage 7 2.2.3 Hecksher and Ohlin 8 3) Foreign Direct Investment
3.1 Major Flows & Trends 2010 9 3.1.1 Different Performance in different regions 10
3.1.2 Explaining the Major Flows & Trends 2010 11 3.1.3 Theories 11 4) Conclusion 14 5) References 15
1) Introduction
International trade is “ The economic interaction among different nations involving the exchange of goods and services, that is, exports and imports” (Economic Glossary). In this assignment I want to review the major flows from country to country all over the world and what the trends are in recent years.
2) International Trade
2.1 Major Flows & Trends 2010
2.1.1 Merchandise Exports
In 2008 the world was hit hard by a financial crisis which the world suffers from, similar to the Great Depression. After this crisis the World didn’t recover yet fully. Banks released cheap Loans for purchasing new properties without ensuring if the borrowed money could be paid back. Concerning steadily raising property prices, banks increase their interest rates which caused the selling of the houses. After this, the property prices fell and mortgages lost their values, so companies’ investments are not profitable anymore. Due to this fact the trend went down. Nevertheless this was one factor, which cranked up the biggest increase in merchandise export, which was recorded in 2010 which shows an increase of nearly 15 per cent, kept up by an increase in global
References: 1) Economic Glossary 2008 Economic Definition of international trade. Defined. Available from http://glossary.econguru.com/economic-term/international+trade (Accessed 1 June 2012) 2) World Trade Organization 2010 3) The Economist Absolute Advantage. Available from http://www.economist.com/economics-a-to-z (Accesse 20 July 2012) 4) World Cocoa Foundation Available from http://www.worldcocoafoundation.org/ (Accessed 20 July 20129 13) Ban Ki-moon World Investment Report (2011) (Accessed 15 July 2012)