Global Trade
Globalization is the increase in global relationship of the people, activities such as trade and culture. Globalization has been made possible through open borders and movement of people, goods and services, exchange of cultural practices, movement of capital without restrictions, and technology (Goldstein vi). In trade, globalization refers to the movement of goods and services within the nations through elimination of barriers to international trade.
These barriers are the different types of tariffs such as import and export duties charged on imports and exports. Goldstein VI asserts that the history of global trade dates back in the 18th century through the discovery of capitalism market. Global trade further expanded in the late 19th century and early 20th century because of industrialization (Goldstein VI). However, the fully realization of the global trade was achieved after the Second World War.
After the World War II, “the international community shared a vision of global community of democratic nations” (Frost 34). The effort was in bringing a “peaceful co-existence, economic development and respect for the human rights” (Frost 11).
In 1940s, several organizations were formed to regulate, formulate and implement the rules to govern the International trade. The first organizations to be formed were the GATT that was a counterpart of United Nations, the World Bank and the IMF (International Monetary Funds) (Frost 33). The GATT provided the international trade rules until the birth of World Trade organization in late1980s.
The formation of World Trade Organization was characterized by “political will to support stronger institutional framework” (Frost 51) by the new world that was revived after the end of Cold War in late 1980s. With the formation of world Trade Organization, better systems of global trading were created. WTO encouraged the elimination of discriminatory treatment in the global trade relations. It further, made sure that the existing trade barriers were fully eliminated.
The emphasis was in improving and maintaining specific goals that would improve the living standards, through provision of “employment with a growing amount of demand and income” (Frost 19). In addition, the WTO focused on increasing the production of goods and services to ensure health and sustainable international trade and development (Frost 14). WTO encouraged rules that would “provide maximum fairness, openness and transparency” (Frost 16).
The WTO also had principles that governed it during the formulation and implementation of rules. The organization basic principles included fair competition (Frost 18). Thus, the global trade according to the WTO principles was meant to reduce unfair competition between the developed countries and developing countries. In fair competition, the organization ensures that developed countries do not exploit the developing countries.
The organization ensures there is fair distribution of goods and services in the international markets by setting quotas for the developed nation’s goods and services in the markets.
The second principle of WTO is to have a predictable market and enhancement of access to growing markets (Frost 31). In international trade, those counties that belong to WTO make agreements that lead to further opening of the markets. The WTO who carry a case study give their forecast towards this markets and recommend these agreements if the market have good trade forecast.
If the markets are healthy, they encourage the member countries to continue. The third principle is on assisting the poorer countries (Frost 27). One of the main objective of global trade is to support the developing countries to grow.WTO ensures that the poor or developing countries are given the rights to participate in the International market which helps these countries to have sources of income for their developments.
Factors to Influencing Global Trade
Politics: as seen in the introduction politics played a great role in the unification of global trade. The immergence of World Wars II and the Cold Wars in the 1980s was because of political instabilities. However, after these wars the international community started the formation of organizations that would harmonize the international relations in trade and other political matters (Frost 21). First was the GATT that gave birth to the WTO in the late 1980s.
These organizations have been for many years in the forefront fighting for improvement in international trade and in fair distribution of markets to the member countries. Similarly, most of the countries that encourage the global trade have a long period of political stability. For instance, the European countries that have advanced more in the global trade have experienced a healthy growth in the international trade due to their political stability. Political stability gives the investors room to invest in other countries markets.
Religion: Religion as key factor to the stability of a nation plays a great role in unification of the global trade. Religions in many countries have been in the lead to fight any kind of conflicts, terrors and all forms of injustice acts such as corruption (Keith and Yamane 377-378).
There are nations that their political stabilities fully depend on the kind of religions practiced. The 9/11 incidence in New York was a religion move that was associated with the Islamic extremist. It is also believed that the Islamic related countries are not politically stable due to their beliefs.
In addition, religious ideas also affect the international programs and events Religion further encourages unification of trade through the use nongovernment organization. Most of the non-governmental organizations are religion related. They preach peace and ensure politically unstable are stable. In addition, they connect them to other countries, which make it possible for trade growth (Kegley and Raymond 160).
Imperialism: The major aim of the formation of the WTO was to have equitable distribution resources such as income according to the demand, which encouraged more unity in the trade. WTO further encouraged fair competition among the member countries that consequently, gave room for the poor countries to develop.
This has enhanced close relationship between member countries that have led to more and more markets opening. Further, the mobility of capital due to elimination of restrictions has seen several countries increase their production through industrialization.
Effects of Global Trade
Globalization of trade has several effects that are associated to it. These effects are either positive or negative. Some of the positive effects of global trade include economic growth, improvement in technology, improvement in quality goods and employment mobility. On the other hand, the global trade has drawbacks such as brain drain, unfair competition and over reliance of some countries on other countries. The focus is on the effects of global trade on migration, disease and cultural development and exchange.
The global trade encourages free movement of employees from one nation to the other. The multinational companies as well as the local companies have the right to source experts and professional from other nations. This opens room for people to move from one country to the next to work for their respective companies.
Similarly, the increased relationships between global countries that conduct trade together help citizens to have a close relationship. This causes some of them to migrate to settle in other countries where they have managed to make friends. In addition, other people migrate to other countries to conduct their own business or seek business opportunities (Goldstein 19).
The other effect of global trade is on disease. Global trade enhances migration of people from one nation to the other, which increase the chances of diseases. There are diseases that are communicable that can be spread through movement of people. This makes several countries to have several measures to eliminate the spread of these diseases.
However, several cases of disease spread from one nation have been realized in different countries and cases. The other effect is on cultural development and exchange. Global trade encourages cultural development and exchange through immigrants. The international trade also encompasses the tourism trade as one of the trade activities that has influenced cultural development and exchange.
The local people learn several cultural practices while the tourists also learn from the local people. Similarly, migration of people from one country to the other also causes cultural development and exchange. The immigrants exchange their cultural practices with people of the country they move. This causes change and incorporation of people to other’s people cultures (Bailey and Peoples 39)
Conclusion
Globalization has been of great importance to the International community. It enhances the exchange of several aspects of life between the developed and developing countries. It gives room to the developing countries to advance in technology. However, if not regulated the trade may lead to under development of some countries due to over reliance on others and exploitation especially from the developed.
Works Cited
Bailey, Garrick and James Peoples. Humanity: An Introduction to Cultural Anthropology. 9th Eds. New York: Wadsworth, 2011. Print
Frost, Randall. The Globalization of Trade. Minnesota: Smart Apple Media, 2004 Print.
Goldstein, Natalie. Globalization and Free Trade. New York: InfoBase Publishing, 2007. Print
Kegley, Charles and Gregory Raymond. The Global Future: A Brief Introduction to World Politics. New York: Wadsworth, 2011. Print.
Keith, Roberts and David Yamane. Religion in Sociological Perspective. New York: Sage Publications, 2011. Print