Even now as you continue reading, global trade is in the process. Countless countries are importing and countless more, exporting. That is simply global trade. The process where countries export and import.
What are export and import?
- Export:
Exporting is when a country sends its goods to another country for sale. I’ll state an example of this to make it easier to understand. Let us say that Germany is exporting some cars. These cars will then be exported to another country. Via land, sea, or air. Then this will be sold either to a business in that country or to a private buyer. This is export. Export is always the transportation of goods from one country to another.
- Import
Import is when a country buys goods and those goods are transferred to the location of the buyer. But remember, just like export, Import is always from one country to another. An import cannot be from one state, city, or town to another. That is just called transportation.
Anyway, an example of this would be: Let’s say there are two countries. Country A and Country B. Country A is very good at making shoes and Country B doesn’t have any. So Country A exports shoes to Country B. So in other terms, Country B imported shoes from Country A.
What is global trade?
Global trade is the combination of both imports and exports beyond a country’s borders. It’s a way of interacting with sellers and buyers from different parts of the globe. In fact, there is the WTO (World Trade Organization) which specializes in helping to ease the difficulties of global trade among its members.
Why can’t people minimize imports and maximize exports?
This is a very common question many would ask, I also asked the same question when I was researching this topic. “Wouldn’t it be more beneficial for a country?” Many economists from the 16th century to the 18th century implemented this idea. Known as Mercantilism.
But as always there will always be an opposing team but just because they were opposing doesn’t mean that they were wrong. Their idea was that, if a country makes products it’s very good at and imports the rest, then everyone wins.
Yes, Mercantilism was more of a “One wins and others lose” system but these new people had the “Everyone wins” idea. This idea changed the world for the better. Nowadays countries are ranked on their productivity and not their money. Due to this, global trade is more of a brotherhood than a rise for power.
Thanks for reading!