International Trade Flashcards
(30 cards)
What is the international trade?
International trade is the exchange of capital, goods, and services across international borders or territories because there is a need or want of goods or services. In most countries, such trade represents a significant share of gross domestic product.
What are the major benefits of international trade?
- More Job Opportunities.
- Expanding Target Markets & Increasing Revenues.
- Improved Risk Management.
- Greater Variety of Goods Available.
- Better Relations Between Countries.
- Enhanced Company Reputation.
- Opportunities to Specialize.
What does protectionism imply?
Protectionism refers to the policy of protecting domestic industries against foreign competition through tariffs, import quotas and subsidies, or other restrictions placed on the imports of foreign competitors.
What does free trade mean?
Type of trade that implies the exchange of goods & services between countries without tariffs, quotas, etc.
What does OECD stand for?
Organisation for Economic Cooperation and Development
What was the main objective of mercantilism?
Favourable balance of trade = value export > value import
What is one of the major growth drivers according to Adam Smith?
Specialisation = key for a greater productivity #RicardoComparativeAdvantage
How did many countries react to the 1929 crash?
The world entered in period of Great Depression
What was the goal of the Bretton Woods system?
- ensure a foreign exchange rate system
- prevent competitive devaluation
- promote economic growth
Who were the primary designers of the Bretton Woods system?
Winston Churchill and F.D. Roosevelt
What international organisations were established by the Bretton Woods system? What were their missions?
- International Monetary Fund (IMF) : control exchange rates, lend reserve currencies to nations, 1945: 29 members ; Now: 189 members
- International Bank for Reconstruction and Development (IBRD) : provide financial assistance ; the mission : shifted from reconstruction to development
When did the Bretton Woods system end? Why?
Bretton Woods system ended in 1971, when Nixon put an end to convertibility of $ to gold
What agreement was signed in Geneva in October 1947?
Multilateral free trade agreement (to eliminate protectionism to boost economic recovery)
What does GATT stand for?
General Agreement on Tariffs and Trade
What did GATT aim at?
Their agenda included: tariffs, intellectual property, agriculture, dispute settlement
What organisation replaced GATT?
WTO
What does WTO stand for?
World Trade Organisation
What is the WTO’s main mission?
Their main mission is to help exporters & importers have better protection + manage their businesses
How many countries are in the WTO?
Today there are 164 countries/members in the WTO
What are the various rules that WTO members have to obey?
Non-discrimination, Reciprocity, Quotas are prohibited, Faire competition, Binding tariffs
What does BRICS stand for?
Brazil, Russia, India, China, South Africa (2010)
What is the New Development Bank?
It was created in 2015, to compete with IMF and World Bank.
Their mission: to mobilise financial resources for infrastructures and sustainable development
What natural resources can be found in Brazil?
Oil and iron rich
What country is the leader of the BRICS?
China and India because they’re the most populated
