Chapter 2 – The World Trading Environment Doole, Lowe and Kenyon International Marketing Strategy

Learning Objectives Discuss the effects and implications of the factors impacting on world trade Explain the key trends in the major regional trading blocs around the globe Understand the role of the major world institutions that foster the development of multilateral free trade across the world

World trading patterns

World trading patterns (cont.)

World trading patterns (cont.) HK Census

The reasons countries trade Improve Balance of trade

Barriers to world trade (cont.) COUNTRY COMPARISON : PUBLIC DEBT

Barriers to world trade (cont.) The WTO promotes trade by: Working to reduce tariffs Prohibiting import/export bans and quotas Eliminating trade discrimination Eliminating non-tariff barriers

The development of world trading groups

MAJOR CHANGES IN THE SINGLE EUROPEAN MARKET Removal of tariff barriers Removal of technical barriers Public procurement Free movement of labour and workers’ rights Opening up of professions Financial services Transport, haulage and coastal carriage Company law Fiscal barriers The environment

TRADE AREAS NAFTA: free trade area Mercosur: customs union US, Canada, Mexico and is the world’s richest single market Mercosur: customs union Brazil, Paraguay, Uruguay, Venezuela and Argentina APEC: PEC members account for approximately 40.5 per cent of the world’s population, approximately 54.2 per cent of world GDP and about 43.7 per cent of world trade ASEAN: free trade area (AFTA) to complete Asian Economic Region by 2020). ASEAN trade is now US$1 trillion and they have a combined GDP of US$1.5 trillion ASEAN-China Free Trade Area (ACFTA): a combined GDP of up to US$6 trillion and total trade volume of US$4.5 trillion