International Business

Management
Ms. Vidhya.j
Assistant professor, ssm
 Unit - 3

Global Trading and Trading Blocks

World trade in goods and services, Major trends and
developments; Tariff and non-tariff barriers, Tariffs,
Subsidies, Import Quotas, Government Intervention in
Formulating Trade Policies, Economic Integration, EU,
NAFTA, ASEAN, European Free Trade Association, Latin
American Integration Association, SAARC, APEC-GATT,
WTO, Anti-Dumping measures.
World trade
Major trends and developments in International Trade
● Trade in goods and services is defined as the transactions in goods and services
between residents and non-residents. It is measured in million USD at 2015 constant
prices and PPPs, as percentage of GDP for net trade, and also in annual growth for
exports and imports. All OECD countries compile their data according to the 2008
System of National Accounts (SNA).
Major trends and developments
● Geopolitical Shifts
● Trade Facilitation
● Agricultural Trade
● Trade in Services
● Changing Supply Chains
● Regional Trade Agreements
● Sustainability and Climate Considerations
● Protectionism and Trade Tensions
● E-commerce and Digital Trade
Tariffs and non-tariff barriers
Subsidies

A subsidy or government incentive is a form of financial

aid or support extended to an economic sector generally
with the aim of promoting economic and social policy.
Although commonly extended from the government, the
term subsidy can relate to any type of support – for
example from NGOs or as implicit subsidies
 Import Quota
● An import quota is a type of trade restriction that sets a physical limit on
the quantity of a good that can be imported into a country in a given period
of time. Quotas, like other trade restrictions, are typically used to benefit
the producers of a good in that economy (protectionism).
 Economic Integration
Economic integration among the world economies varies in degree. The
economies are
 Free trade area
 Customs union
 Common market
 Economic union
● https://en.wikipedia.org/wiki/List_of_members_of_the_European_Council

European Union which was formed by six countries

France,Germany,Italy,Belgium,Netherlands and Luxembourg - Treaty of Rome
1957
Later UK Ireland and Denmark joined the Community – 1973
Greece in 1981, Portugal and Spain in 1984
Austria,Finland and Sweden joined in 1986

https://en.wikipedia.org/wiki/Member_state_of_the_European_Union
Organization of EU
 European Council
 European Commision Advisory Committees
 Court of Justice Economic and social commitees
 Court of Auditors Monetary Committee
 European Parliament Consultative Committee on Coal and Steel
Industry
Functioning of EU
NAFTA(North American Free trade agreement)
● It came into being on January 1,1994.
● Free trade agreement was signed between USA and Canada in 1989 and
Mexico joined in 1994. NAFTA

Objectives
 Create business opportunities
 To enhance competitive
advantage of the companies
 To reduce the prices of
products and services
 To enhance Industrial
development
 To stop people migrating to
USA
 To build political relationship
 AFTA(Asean Free trade Agreement)
Objectives
● Encourage inflow of foreign investment
● Establish free trade area in the member countries
● To reduce tariff of the products
European free trade agreement (EFTA)-1959
LAIA (Latin American Integration Association)
SAARC(South Asean Association for Regional
Cooperation)
APEC
Thank you