Global trade
is a very important aspect of markets and economies.
Global trade has been an important function of world's markets for centuries. Global trade provides countries with goods that are either too expensive to produce domestically or are completely unavailable inside their country. Global trade brings prosperity and happiness to many countries and helps reduce the amount of goods shortages around the world. Along with supplies, global trade can help bring wealth to countries that have a good source of production, and supply a new source of consumers to their market. The World Trade Organization is an important part of world trade and helps regulate its many facets.
History
Global trade has been occurring since the time of the Egyptian pharaohs and has slowly progressed into a natural and necessary occurrence for market profitability. Global trade took its largest steps when Marco Polo brought back goods from Asia to the cloistered European countries and brought new life to the stifled markets. These new goods were highly valuable, and global trade routes were soon being sought by a great deal of explorers. These searches would eventually lead to the discovery of the new world and an entirely new land for resources and trade.
Types
Global trade occurs with nearly any imaginable good, service or resource. Global trade helps move goods from countries that have a surplus to countries that have a strong demand. Global trade moves the most basic goods and helps bring living standards to new levels in many countries. Global trade occurs with luxury goods as well and gives suppliers a much larger market to which they can sell their wares.
Countries
The largest global traders are America, China and the European Union, which combined account for nearly 80 percent of all exports. India is one of the fastest-growing countries and is quickly becoming a major player in the world trade economy.
Advantages
There are innumerable advantages to global trade, and many countries gain wealth and power by trading with other countries around the world. Global trade is also one of the primary methods that third-world countries can rise up to a new level of prosperity and increase the standard of living in their country.
Disadvantages
While there are many advantages to global trade, side effects of growth can negatively affect certain aspects of a country. New sources for a material or product can cause consumers to begin purchasing from the new source and abandon domestic suppliers. This shift in demand can lead to many domestic jobs being lost and moving to another country. Outsourcing is another side effect of global trade: As new growth in countries occurs, many large companies shift jobs over to these countries to take advantage of the bustling economy. This outsourcing of jobs can raise unemployment levels in the host country by a great deal.
