Today there are so many issues which needs to be reformed, one of which is International Trade otherwise known as globalization.
International Trade is simply referred as the exchange of goods and services across national boundaries. International trade accounts for a significant share of gross domestic product (GDP) in most of the countries. The value of international trade in 2010 was $19 trillion which is 30% of the world GDP. It means about one third of the goods and services are exchanged globally around the world.
According to "Global Policy Forum", till 2030, 60% of the world economy will exchange their goods and services internationally.
Theories of International Trade
2.1 Trade Liberalization
When countries are interested in International Trade they need to follow trade liberalization or free trade.
Over 200 years two opposing forces: the promotion of free trade and protectionism has been the main challenge of International Trade. Trade liberalization is the removal of the restriction or the reduction of barriers on the free movements of goods and services across countries. The main objective of trade liberalization is to remove tariff and non-tariff barriers. It includes the removal or reduction of both tariff and non tariff obstacles. The easing of such restrictions is often referred to as promoting "free trade." Trade liberalization encourages and facilitates countries to specialize and benefit from the principle of Comparative Advantage. Further, it has helped to increase the world output by which competition has increased and consumers are able to get products and services at lower prices.
The UK is an extremely open economy with a long history of promoting trade openness. By 2009, trade accounted for around 60% of the UK's national income. (Source: Statistics.gov, 2009.)
2.2 Poverty
Poverty simply means lack of income or consumption. According to World Bank, almost half the world, over three billion...
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