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Global trading

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A presentation on global trade and investment

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Global trading

  1. 1. GLOBAL TRADE & INVESTMENT ENVIRONMENT Deepthy Sai
  2. 2. Global Trade <ul><li>M any economists believe that unrestricted (free) trade between nations will raise the economic welfare of all countries that participate in a free trade system. </li></ul><ul><li>Free trade: refers to a situation where a government does not attempt to influence through quotas or duties what its citizens can buy from another country or what they can produce and sell to another country. </li></ul><ul><li>Trade theory: theory that explain (1) why it is beneficial for a country to engage in international trade, and (2) the pattern of international trade that is observed in the world economy. </li></ul>
  3. 3. <ul><li>International trade and foreign investment support the following objectives: </li></ul><ul><li>Protecting local employment and labour conditions </li></ul><ul><li>Reducing economic and political vulnerability </li></ul><ul><li>Encouraging diversification of industry </li></ul><ul><li>Permitting the development of local technologies </li></ul><ul><li>Protecting the environment </li></ul>
  4. 4. <ul><li>Transferring skills and technology that is not normally available in an economy. </li></ul><ul><li>Allowing the importation of strategic goods and services. </li></ul><ul><li>Encouraging innovation and adoption of new practices and higher standards. </li></ul><ul><li>Encouraging efficiency through the adoption of ‘international best practices’ and importation of technology. </li></ul><ul><li>Giving developing countries fair opportunity to trade with developed countries. </li></ul>
  5. 5. <ul><li>Loss of national economic sovereignty with regard to employment , taxation, inflation, tariff and wages policy. </li></ul><ul><li>A reluctance by nations to take unilateral environmental initiatives for fear that they might unduly erode a nation’s economic competitiveness. </li></ul><ul><li>Erosion of local culture in the face of imports that have a strong cultural element such as films, electronic media, music and food. </li></ul><ul><li>Forcing countries to adopt environmentally unsustainable or socially unjust practices which damage the global commons in order to be able to earn foreign exchange. </li></ul><ul><li>Forcing many countries, including India, into ever-increasing foreign debt leading to spiraling overseas interest payments. </li></ul>
  6. 6. <ul><li>vi. Inducing a global increase in transport use which is both inefficient and destructive to the environment. </li></ul><ul><li>vii. Allowing transnational corporations to increasingly dominate global trade and investment which in many cases is anti-competitive. </li></ul><ul><li>viii. Leaving many developing countries at the mercy of IMF and World Bank required restructuring, often resulting in social polarisation. </li></ul><ul><li>ix. Making an economy less diverse and more vulnerable through encouraging it to specialize in those industries in which it has competitive export advantage. </li></ul>
  7. 7. <ul><li>To limit trade in goods and services that are produced by methods that are environmentally unsustainable or socially unjust. </li></ul><ul><li>To promote trade associations and participate in international trading systems in order to enhance the achievement of this goal. </li></ul><ul><li>To increase India’s self-reliance by limiting net foreign debt and current account deficits. </li></ul><ul><li>To promote the regulation of transnational corporations. </li></ul>
  8. 8. <ul><li>International Context </li></ul><ul><li>Fair Trade and Reform of the WTO </li></ul><ul><li>Transnational Corporations </li></ul><ul><li>National Context </li></ul>
  9. 9. <ul><li>On a survey conducted with executives from around the world, three trends were identified that would affect global business and how those trends would impact their company’s profitability. </li></ul><ul><li>The growing number of consumers in emerging economies. </li></ul><ul><li>The shift of economic activity between and within regions. </li></ul><ul><li>The greater ease of obtaining information and developing knowledge. </li></ul>
  10. 10. <ul><li>Increasing communication and interaction in business and social realms as a result of technological innovation. </li></ul><ul><li>Shifting structures or emerging forms of corporate organization. </li></ul><ul><li>More social backlash against business. </li></ul><ul><li>85% of the executives describe their business environment as more competitive than it was 5 years ago. </li></ul><ul><li>Innovation in products, services and business models was identified as the main reason for the accelerating pace of change. </li></ul>
  11. 11. Thank you

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