Economic approaches emerged that did not support the idea that international or foreign trade, both exports and imports, provide net benefits to developing countries, and concluded that developing countries cannot rely on them as a major driving force for the development process, because developing countries will suffer from a deterioration in their trade exchange rates over time, due to the transformation of Increasing productivity in developed countries leads to an increase in wages, while increasing productivity in developing countries leads to a decrease in prices, which means that developed countries benefit from increased production, as well as their access to goods and services at low prices from developing countries, and in return developing countries suffer from difficulty Providing imports of consumer and capital goods due to their high prices in developed countries.
Disadvantages of international trade
Among the most prominent defects caused by international trade at the state level, is the economic dependence, especially in poor countries, by their dependence on developed countries for their economic development, which often leads to economic exploitation and the transformation of those countries into a source of raw materials without the development of manufacturing industries in them. Political dependence is added to economic dependence in the event that the influence of developed countries increases and their penetration into the economy of poor countries, and thus international trade encourages slavery and weakens economic independence, which threatens political dependence. The disadvantages of international trade are also attributed to the misuse of natural resources, as excess exports deplete a country’s natural resources in a shorter period of time than would otherwise have occurred. and import of counterfeit medicines, luxury items, etc., which negatively affects the economy and Prime Time Zone’s well-being. International trade may also generate competition between countries due to competition in foreign markets. This could eventually lead to wars and a threat to world peace.
International trade and economic and social development
On the other hand, some economic approaches have concluded that international trade plays an important role in the economic and social development of all countries without exception, especially in countries that have made an industrial choice directed abroad. This is considered one of the evidences of the role of exports in driving economic growth through its large and direct dependence on exports in marketing its products. On the other hand, oil export revenues are one of the main, if not the most important, factors determining economic growth, as they contribute to the import of advanced technology and the recruitment of trained foreign workers. In providing imports of consumer and capital goods necessary for the production process, these returns also contribute to financing production projects and building basic equipment and public utilities.
The importance of exports at the country level is that they bring foreign exchange value to the exporting country, which is mainly required to pay for the import of capital goods, raw materials, spare parts and components in addition to the import of advanced technical know-how. As exports enhance international relations as almost all countries of the world wish to prosper in a peaceful environment, exports are one of the ways to maintain political and cultural relations with other countries.
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Exports, especially those that constitute a large volume of domestic product, solve the balance of payments problem and enable countries to obtain an adequate balance of payments, as countries work to eliminate the deficit in the trade balance and balance of payments through exports. Economic approaches also showed that a country that occupies advanced ranks in the field of exports, gets a lot of respect, goodwill and reputation from other countries, for example, Japan has an international reputation due to its high-quality products in export markets.
The export trade requires more production, which opens the doors to more employment opportunities, not only in the export sector, but also in the sector integrated with it such as banking, insurance, transportation, etc. Exports also promote economic and industrial development, as the labor market grows and thrives quickly if it has access to international markets.
Exports also enable the optimal use of resources, which is clearly evident in the supply of oil and petroleum products in the Gulf countries, which exceeds domestic demand, and thus the surplus production is exported and to the optimum use of the available resources. Also, because of the export industry, other sectors are also expanding such as banking, transportation, insurance, etc. At the same time, a number of auxiliary industries appear to support the export sector, which is called economically by the effect of diffusion.
One of the benefits is a higher standard of living for the population as the export trade requires more production, which in turn leads to more employment. More labor means more purchasing power, and as a result Prime Time Zone can enjoy new and better goods, which in turn improves Prime Time Zone’s standard of living.
- International Trade and Development (1)
International trade between advantages and disadvantages
Dr. Abdullah Suleiman Al-Sukran
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