International Trade And Investment Patterns Essay

1861 Words8 Pages
International trade is the exchange of goods and services between countries. International business provides consumers the products and services, which are not available in their own country. This essay addresses the international trade and investment patterns. The first two paragraphs shade light on international trade theories and patterns. It discusses various theories of international trade which are mercantilism, absolute advantage, comparative advantage, heckscher-ohlin theory, product life circle theory and porter’s diamond theory. The third paragraph describes the roles of World Bank, world trade organisation and international monetary fund. It also considers how these organisations impact the economy of United Kingdom. The last paragraph states the potential opportunities and costs for UK based companies in the enlarged European Union. Additionally, currency risk is explained in this paragraph. Existence of International business has been found throughout much of the history. Ancient civilizations used cross territory trade to spread their culture, religion and art. International trade encouraged nations to utilize their natural resources more efficiently. It specialised a country in producing the products which are most profitable than others. These goods could then be exported in exchange of less efficient products. This procedure demonstrates the pattern of international business. Some materials are found naturally abundant in certain countries. For example, oil is plentiful in Saudi Arabia, Ghana has cocoa and Brazil has ample coffee, therefore, these countries export these products to other countries. This pattern is quite obvious, but there is one more pattern of international business which is not related to natural resources. Its concerns with technology and skills, for instance, Japan are the largest car manufacturer of the world
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