There has been hectic activity and faster changes in the International Trade front during the last few decades. Especially after Globalization initiatives started picking up, the fast-changing manner of international trade has been posing unprecedented challenges to global trade engagement.
Significance of Global Trade Engagement and its Changes
Economic, social, and political factors play a crucial role in shaping the future of world trade. They in fact strongly influence the global trading system. These factors are comprised of changes in manufacturing and consumption patterns, demographic shifts, and other such elements involved in international trade activities. Trade for development is the prime focus among nations, in the competitive business scenario.
What makes Trade Engagements Tick?
Protecting human health and global environment have been the focus of world economies. These are essential for not only sustaining economic growth but also for future development. In the recent times, there have been considerable changes in the attitude of nations in sharing and circulating information on the Trade Engagement front. World economies have started realizing the importance of working as a team and partnering with other nations.
What leads to Change?
Technology leads the list of reasons that act as drivers of change. Most significant factors include communication and transportation that have transformed the world to new levels. Greater geographical spread of revenue growth, foreign direct investment, and more extensive international exchange made possible by recent business processes have all paved the way for newer and better avenues in international trade engagement.
Global Trade Trends
- Transport & communications cost have drastically decreased
- International Trade in merchandise and commercial services have increased greatly, services playing a major role
- Developing countries have enhanced their share in global exports considerably during the last 3 decades
- Global trade has been nearly twice that of production since many decades—reflecting the prominence of international supply chains
- Forecasts show that developing countries are about to lead the developed ones in terms of export as well as GDP growth in the future
Multilateral Trade Co-operation and Global Trade Engagement
- The expected trends appear likely to affect emergence of value chains, greater presence of non-tariff measures, and more volatile commodity prices
- Interdependence between trade in goods and that of services has been increasing—likely to increase further
- Delivery of sufficient volume of trade finance at affordable costs will become possible