Individual Report

Q.1 ‘The world’s poorest countries are at a competitive disadvantage in

almost every sector of their economies. Free trade cannot possibly be

in the interests of such nations.’ Critically discuss this statement using

appropriate theories and real world examples to support your

arguments.

Ans.1) Globalisation is investing of money and bringing businesses from domestic markets to other markets of the globe , leading to interconnection of different economies across the globe. Free trade is a part of globalisation. Free trade is the unrestricted purchase and sale of goods and services among the countries without any restrictions like tariffs, duties and quotas. This trade is a win-win proposition as it gives every nation a chance to concentrate on their core competitive advantages which are maximising economic output and encouraging income growth for their citizens.

This allows companies to expand into new markets all across the world. International trade is necessary for three main reasons: it allows countries to get new ideas from one another, it allows countries to resources that they need, and it reduces the risk of an economic collapse.

International trade allows countries to learn from each other and take in new ideas. While one country might be focused on developing one type of product, another maybe focusing on completely different subject. Together, they can share their ideas, benefiting both of the economies for both countries. For example, Japan tends to be ahead of the field in consumer electronics. Countries like the United States can directly purchase goods from them, as well as learn about the new technology is being discovered on the other side of the world.

Another key reason why international trade is needed between countries is because resources that country needs are not available everywhere. For example, the United States imports lots of oil from countries in other continents. Resources do not have to be material goods, but can also...