International Trade Importance

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International trade plays a key role both for country’s economy and for global economy. International trade or free trade can be very beneficial, as it provides much bigger market, and also allows producers to produce their goods much cheaper. These characteristics are mainly important for small economies, as they produce much expensive and do not have bigger market because of little specter of trade. International trade is of great importance for the developing countries, as it can boost their productive capabilities and enhance their economies. “Trade openness” is a significant determinant of GDP. This openness gives the opportunity to increase welfare and standards of living.
Benefits of free trade
First of all, free trade enables countries
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The technology progress have given the people the opportunity to do business internationally. Open trade allows the countries to find the cheapest things all over the world and offer the best options for the consumers. These leads to the competition among producers, and makes products much cheaper. However, there are ones who argue that globalization can lead the wealthy companies to take advantage of poorer ones, as in this case, they can exploit the cheap labor. The supporters of anti-globalization movement mention, that globalization can abolish the diversity and lead to homogenized world, where Western traditions overwhelm. However, supporters of globalization say, that nations, who are opened to global economy, are much more prosperous and have better standards of living.
The EU, international trade and developing
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The government, in this case, has little interference. In today’s market system, it is very easy for the large company to manipulate the market. Today’s market outcomes can be influenced by the monopolies or oligopolies. However, some countries set competition law which brings back competitiveness. The spread of free trade, and creation of free market system becomes possible if the government does not hinder the international trade, and reduces or removes the taxes. Free market has undergone some changes. Nowadays, the companies not focus on their influence on product prices, but they redefine technologies, and manipulate the consumer tastes by advertising and brand image

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