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What is international trade?

2022-12-16

International trade refers to the exchange of goods and services between countries, which is called international trade. In the contemporary era, no matter the size of the land area or the population of the world, a country's economic development is fast or slow. Due to the limitations of natural resources and the differences in social and technological development, all countries need to exchange what they have with other countries, which requires international trade. Through the exchange of goods and services, on the one hand, we can import the materials and technologies needed for our own economic development; on the other hand, we can export our own goods and services to speed up our economic construction and improve people's lives.

International trade, from the perspective of a country, is its foreign trade, but from the perspective of the international market or the world market, it is international trade or world trade. International trade is the exchange of goods and services between countries. It is composed of foreign trade of countries all over the world.

The nature of a country's foreign trade depends on its socio-economic system. As the economy of capitalist countries is based on private ownership of the means of production, capitalists use goods or services to exploit the working people of their own countries and other countries and obtain high profits in their foreign trade. As the country's foreign trade is based on the public ownership of the means of production, the purpose of the import and export of goods or services is to earn more foreign exchange, speed up modernization, and meet the growing material and cultural needs of the whole society.

International trade is the product of the development of human society to a certain historical stage. The development of the international division of labor and the formation of the world market emerged after the production of the capitalist machine industry. There is a trend of unlimited expansion of capitalist machine industrial production. Marx pointed out: "Only the limitation of raw materials can limit its development." The large-scale industrial production of machinery provides modern means of transportation and communication, which further develops the international division of labor.

The international division of labor is a social division of labor beyond the scope of the country and an important symbol of the development of production socialization in the world. The capitalist relations of production make the international division of labor one-sided. It enables some countries to engage in agricultural production and others in industrial and processing production. The export of goods and capital from the markets of various countries constitutes the whole world market through international trade.

With the formation of the capitalist world market, "the past state of self-sufficiency and isolation of the local and national has been replaced by the interaction and interdependence of all ethnic groups in all aspects." It can be seen from this that economic problems cannot be solved by individual countries, but must be coordinated and exchanged in international relations. Large machine production has low product cost and high labor efficiency. Manual production cannot compete with large machine production. Large machine industrial products beat handicraft products with high quality and low price, thus occupying these cities.

After the Second World War, with the great mechanization of production, capital became more and more concentrated, commodity production became more and more monopolistic, international trade was further developed, and capitalism emerged with new features: stagnant production, high inflation, and high unemployment. When capitalism developed into a monopoly stage, it was difficult for commodities to circulate freely, and the fight for money and trade was fierce. The economic situation of capitalist countries will inevitably be reflected in the international market. The characteristics of the current capitalist international market:

(1) The capitalist international market is becoming more and more monopolistic and centralized. This is the inevitable result of international production marked by transnational corporations. The import and export trade of the United States is basically monopolized by consortia. There are nine consortia in Japan that monopolize import and export trade. Japan and Western Europe jointly deal with us, negotiate prices with us, and monopolize international trade. This requires us to carefully study countermeasures.

(2) Due to the influence of three aspects (production stagnation, inflation and unemployment) on the market of western capitalist countries, the economic development of various countries is unbalanced, and countries have successively adopted trade protectionism. Protectionism in international trade can be divided into tariff barriers and non-tariff barriers. The early protection of Wang Yi was based on the establishment of large tax barriers, the adoption of high tariff policies to restrict imports, and the protection of domestic industry and domestic market.

For example, a Thai clothing factory owner, restricted by Wang Yi, an American cargo protection company, was unable to recover the overdue debt worth 3 million baht (equivalent to 900000 Hong Kong dollars) from the exported ready to wear goods, and was forced to go nowhere. Thai officials said that if the United States formally passed the trade protectionism bill, a number of garment factories in Thailand would be closed down. Since the middle of the 19th century, the protectionism of non-tariff barriers has arisen. The main protectionist measures are as follows:

1. Quota limits. Specify a limit or a certain amount for sensitive goods. Import surcharges shall be levied on commodities imported in excess of quotas or quantities,

2. Anti dumping measures. To set a minimum price for the sales price of imported goods. If a certain kind of goods is sold at a price lower than the minimum price, which has caused or may cause damage to the industry of the importing country, the importing country has the right to sue the producers and demand that anti-dumping duties be levied on such imported goods;

3. Automatic exit constraints. It is usually the requirement of the importing country that the exporting country restricts the export of a product. In fact, the importing country restricts the growth of imports,

4. Maximum. A preferential import quota shall be set for some commodities, within which they can generally be imported duty-free or at preferential tariff rates, and those exceeding the quota shall not be imported,

5. Import license system. When importing certain commodities, businessmen must apply to the importing country for import license in advance before they can import them,

6. Orderly sales and organized free trade. National trade is carried out through negotiation (or agreement) between import and export countries;

7. Gate price. A restrictive price is set for certain commodities to protect domestic products from competition from foreign commodities. Otherwise, additional tax will be levied.

With the development of international trade, countries have reduced their tariff rates. However, developed countries adopt technical barriers in accordance with their own interests, which seriously threatens foreign trade of all countries. The old trade protectionism mainly adopted high tariffs, import quotas and quotas to control imports, while the frequently changing, complex and harsh technical standards and various technical regulations are the means and strategies of the new trade protectionism.

The performance of technical barriers to trade: there are various technical standards for imported goods issued by local and non-governmental organizations of various countries. The customs inspects whether the imported goods conform to these technical regulations, standards, packaging, labels, certification procedures, etc.

Technical barriers are flexible and changeable, making it difficult for foreign manufacturers to adapt. In order to protect the interests of domestic producers, some developed countries often intentionally raise the standards of imported goods and restrict imports. The United Kingdom, France and the Federal Republic of Germany have signed electronic component trade agreements, stipulating that the standard certificates issued by any of them are valid for the other two countries, and the products of other countries need to be strictly inspected. This agreement once made it difficult for the United States to export electronic components to Europe.

Technical barriers often wear the cloak of legality. In order to protect the interests of consumers and the ecological environment, many countries have promulgated increasingly stringent safety, health and environmental protection standards and technical regulations. For example, the Law on the Administration of Food, Drugs and Cosmetics, the Law on the Import of Milk, the Law on the Import Inspection of Vegetables and Fruits, the Law on the Limitation of Toxic Substances in Products, the Law on Burnable Fabrics, the Law on the Safety of Consumer Goods, and the Law on the Limitation of Noise issued by some developed countries have strict provisions on the standards and inspection methods of imported commodities. When the domestic economy is depressed or the imported commodities affect the interests of domestic producers, The import shall be restricted on the grounds that the safety and health do not meet the standards.

There are many technical barriers, and the degree of protection is difficult to estimate. In particular, when exporting goods to China, the Federal Republic of Germany, Japan and other countries, various technical regulations are very complex, and local or non-governmental institutions in these countries have also issued many technical regulations. According to statistics, technical barriers in international trade account for about 10-30% of non-tariff barriers. With the improvement of consumption levels in various countries and the development of highly sensitive monitoring technologies, this proportion has risen rapidly.

Technical barriers have a very negative impact on the foreign trade of developing countries. Many developing countries, due to the lack of accurate information on foreign technical standards, coupled with the limitation of technical level and the lack of strict quality management, have developed harsh and even nit picking technical regulations and cumbersome inspection procedures for their commodities.

According to statistics, developing countries are 3.5 times more restricted by technical barriers to trade in international trade than developed countries. It is not uncommon for developing countries' export commodities to be claimed, undervalued and rejected, which seriously affects the economic interests of developing countries.

General Agreement on Tariffs and Trade The purpose of the Agreement on Technical Barriers to Trade is to eliminate or at least reduce technical barriers to international trade and remove technical barriers to trade liberalization. This agreement has played a positive role in preventing developed countries from using differences in standards and certification systems as tools of trade protectionism and promoting the development of international standardization, but it has not yet further resolved how to help developing countries export to developed countries The problem of overcoming technical barriers.

It is unrealistic for developing countries to substantially increase their exports to developed countries and place their hopes on developed countries to relax the technical requirements for imported goods. Its foothold should be to develop its own science and technology, improve product quality, and at the same time, strengthen solidarity to fight tirelessly to eliminate technical barriers to trade.

According to statistics, there are more than 900 kinds of non-tariff barrier projects set up in various countries. Textiles, clothing, steel, automobiles, consumer electronics, footwear and food are more seriously affected. It is estimated that about 25% of world trade is affected by different forms of non-tariff barriers.

Trade protectionism does not just affect the development of world trade, but also seriously damages the world economy. One third of the commodity markets in Western countries are in developing countries. As the exports of developing countries to industrial developed countries have been severely discriminated against, their income has declined sharply, and foreign debts are difficult to repay, which in turn affects the western banking industry. At the same time, it also weakens the import capacity of developing countries.

(3) Western capitalist countries face new technological challenges. With computer as the center, science and technology are developing in depth, with high efficiency, low cost, and multi variety commodity production. The competition in the international market is very fierce. The competition among ergonomics, psychology, aesthetics and various sciences (including natural sciences and social sciences).

(4) Western capitalist market trade practices are becoming legal. In the contemporary era, international trade has various specifications. It takes longer and longer to sign various contracts and involves more and more areas. Monopoly and competition alternate. International trade law has become a guarantee to safeguard the legitimate rights and interests of all parties involved in international trade. The selection of insurance conditions, the signing and performance of contracts, claims, the registration of goods, trademarks, and patent applications shall be handled in accordance with the laws and regulations stipulated in the international market. The international market is a market controlled by monopoly capitalists. The rise and fall of various commodity prices are controlled by monopoly capital consortia.


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