1. Chapter 22 International trade
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Chapter 22 International trade
This is the Title Slide
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R. DELANEY

2. What is international trade?
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What is international trade?
This involves buying and selling goods and services beyond the boundaries of our domestic economy.
This is the Title and Content Slide
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R. DELANEY

3. 23/11/2018
Imports
Importing involves the purchase of goods and services from other countries.
Visible imports = goods purchased from abroad e.g. Oranges from Spain.
Invisible imports = services purchased from abroad e.g. Irish citizens holidaying in Spain.
In the case of all imports money leaves the Irish economy as we pay for goods and services from abroad.
This is a comparison slide
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R. DELANEY

4. 23/11/2018
Exports
Exporting occurs when Irish producers sell goods and services to other countries.
Visible exports = goods sold to customers abroad e.g. Irish cheese sold to France.
Invisible exports = services purchased by overseas customers e.g. French citizens holidaying in Ireland.
In the case of all exports money flows into the Irish economy as overseas customers pay for Irish produced goods and services.
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R. DELANEY

5. Why trade internationally?
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Why trade internationally?
To compensate for limited factors of production
To access essential raw materials
To improve consumer choice
To earn foreign currency
To gain access to larger markets
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R. DELANEY

6. Measuring international trade
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Measuring international trade
Balance of Trade: Visible Exports – Visible Imports
Balance of Invisible Trade: Invisible Exports – Invisible Imports
Balance of Payments: Total Exports – Total Imports
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R. DELANEY

7. Measuring international trade
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Measuring international trade
A surplus refers to a situation where the value of exports is greater than the value of imports.
A deficit refers to a situation where the value of imports is greater than the value of exports.
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R. DELANEY

8. Protectionism Protectionism requires the government to
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Protectionism
Protectionism requires the government to
limit or prohibit free trade
Arguments in favour: Job creation Industry protection Self-sufficiency Balance of payments
Arguments against: Retaliation Limited factors of production Costly and inefficient Small scale operations
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R. DELANEY

9. Barriers to trade Tariffs Quotas Subsidies Regulations Embargoes
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Barriers to trade
Tariffs
Quotas
Subsidies
Regulations
Embargoes
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10. Opportunities for Irish business as a result of international trade
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Opportunities for Irish business as a result of international trade
Free trade/market access
Economies of scale
Balance of payments
Public procurement
Foreign direct investment
Technology/world class manufacturing
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11. Challenges for Irish business as a result of international trade
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Challenges for Irish business as a result of international trade
Increased competition
Dominant firms
Language/cultural issues
Distribution problems
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12. Factors in the growth and development of world trade
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Factors in the growth and development of world trade
Growth in transnational companies
Emergence of trade blocs
Improved transport
Deregulation
Emerging markets
Impact of ICT
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R. DELANEY

13. World Trade Organisation (WTO)
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World Trade Organisation (WTO)
The WTO currently has 140 member countries who account for almost 97% of global trade. It aims to deregulate the international trading environment and ensure that international trade operates efficiently, equitably and predictably. The WTO also helps resolve trade disputes between member countries.
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R. DELANEY