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Summary International Trade: Part Trade
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This is a summary of the content given in the Trade part of the course International Trade. It's based on the PowerPoint and class notes. I passed this exam first try.
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INTRODUCTION: WHAT ISINTERNATIONAL TRADE
INTERNATIONAL TRADE
• Tariffs
• Financing
• Different transport mode
• Globalization
• Strategic choices
• Distribution and logistics
• Supply chain
• Payment methods
• Institutions and organization
• National differences
• Documents
• Risks
• Export and import
Trade = central to ending global poverty
➔ Role: supporting growth and reducing poverty
➔ Open trade policies enable economic growth for all
➔ Countries open to international trade grow faster, innovate, improve productivity and provide higher
income and more opportunities to their people
➔ Open trade: benefits lower-income households by offering consumers more affordable goods and
services
➔ integrating with world economy through trade and global value chains -> helps drive economic
growth and reduce poverty-locally and globally
CAN WE DO IT IN A SUSTAINABLE WAY?
• Different critiques on globalization
• Link with UN SDGs
• Trade resulted in increased CO2 emissions
• Always take triple bottom line into account: people, planet, profit (3Ps)
,CHAPTER 1: INTRODUCTION TO
INTERNATIONAL TRADE
WHY INTERNATIONAL TRADE?
Last centuries:
• Greater openness and liberalized trade
• But: protectionism has always immersed
• Advanced nations: realise economic growth and stability depend on strategic mix of trade policies
both free trade and protectionism
WORLD TRADE
• World trade volumes: 42 times level of 1950
• World trade values: over 302 times level of 1950
• Growth acceleration since establishment of WTO in 1995
Exports Imports
• Asia is growing fastest • Asia is growing fastest
• All regions are increasing but pace is • South America is decreasing imports
different
AFTER COVID-19
• US still leading
• China not far behind
• Germany far ahead from other EU countries
• First South-American country: Brazil
• First African country: South-Africa
Impact on covid 19:
• Big decrease in first half of 2020
• Steady recovery since second half of 2020
IMPORTANT CONCLUSIONS
• Global trade concentrated in few countries
• Leading exporters = leading importers
• Leaders often Western Industrialized Countries
− China and Far East: growing
− South America: only Mexico and Brazil in top 30
− Africa not in top 30
− Belgium decreased but sill high
,BIGGEST ECONOMIC PLAYERS
US
• Discussion with China and EU led to increased import taxes for wide range of products (Eg airplanes,
cars, …)
• Impact of polarization
• Different opinions regarding climate policy, fiscal policy and foreign policy
CHINA
• Soon to be biggest economy in the world
• Trade between China and EU = 1 billion USD per day
• Questions regarding human rights and environmental policy
• Biggest companies in hand of state (the Communist party)
BRICS COUNTRIES
RUSSIA
• Before war in Ukraine: fifth biggest trading partner of EU
• Export mainly dependant on natural resources
BRAZIL
• Depends on export of coffee, sugar, beef, concentrated orange juice, soy, chicken, shoes, iron and
steel, chemical products and wood
• Fourth biggest builder of airplanes which focusses on production of smaller-sized jets
INDIA
• Most important export products: engineering components, chemical and pharmaceutical product,
gems and jewellery, clothing, agricultural products, iron and mineral
• Second biggest exporter for agricultural products and related sectors like forestry
• IT-sector also booming because of cheap labour and good infrastructure
SOUTH AFRICA
• Most important export products: iron ore, platinum, gold and other minerals
, BELGIUM’S STATUS
• 2021: 10th position on list of world merchandise exporters + 12th world merchandise importer
• 5th place in Europe
• Behind Canada and before Mexico
• Balance of trade = primarily positive
• Distribution of trade by trading partner
• EU main trading partner:
− Majority of goods exported by Belgium remain in Europe
− Especially neighbour countries: (Germany, France, The Netherlands)
• Outside EU-countries
− US main non-European trading partner
− China, UK, Japan, Switzerland, Turkey and Russia
Important chemicals for Belgian export Important mineral products for Belgian export
• Packaged medicaments • Refined petroleum
• Vaccins • Diamonds
• Blood, antisera, toxins and cultures • LNG to rest of Europe via harbour of
Zeebrugge
Import/export sector:
• Large variety
• Almost 30% of exports are chemicals and pharmaceuticals = main export products
• Transport equipment + machinery and equipment = >22%
• Important: 11,2% mineral oils
• Foodstuff: 5,5% export, 3,9% import
• Textile sector also important although strong competition abroad
➔ Decreased over last few years
➔ Especially carpets and fabric for furniture and floor coverings
DID YOU KNOW?
2017:
• 1st world exporter of master alloys of copper, frozen vegetables, looms
• 2nd world exporter of flax
• 3th world exporter photographic in film rolls
• 4th world exporter of diamonds
• 5th world exporter of epoxides, …
Belgium is considered 3th best country in the world when it comes to logistics
WHY DOES BELGIUM HAVE AN OPEN ECONOMY?
• Central location
• High population density
• Scarcity of natural resources
• Centre of Belgian economy = processing foreign goods and export them
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