Transcript Chapter 13 International Trade Patterns

Chapter 13 International Trade
Patterns
• Describing the evolving pattern of
international commerce
• Documenting the emerging markets for global
exports
• Examination of global trade flows in six major
commodity groups
World Patterns of Trade (1)
A clear trend
towards
rising
exports/imports
as a share of
output (GDP)
World Patterns of Trade (2)
Europe – many
small countries
with strong
trade to other
small countries,
somewhat like
trade among
U.S. states
US – a huge internal market
World Export Trends
World Exports by Category
One year change
Is very short,
But the total
Change (8%)
Seems low
Given the
Data for
Individual
industries
The extreme position
of the United States,
a mixed picture
for Europe,
the need to view
these data over
time, which would
not alter the U.S.
position for the
last several decades.
China’s huge trade
surplus: what to do
with the money?
Major U.S. Trading Partners
Geographic proximity; country economy size as explanations for level of trade.
The notable absence of India from this table.
U.S. Commodity Imports and Exports
U.S. Trade in Services
• Unlike trade in goods, where the U.S. has a
persistent trade deficit, the U.S. has a
persistent trade surplus in services
• This is based on services involving intellectual
property, finance, producer services,
information services
• Implicit trade in services: government debt, in
which foreigners hold huge reserves of US $
Key Trade Relations for Other
Countries and Country Groups (1)
• Canada – Strong ties to the U.S., a “gravity model”
outcome, exports dominated by “staples”, rapid growth
in trade in services
• EU – Table 13.4, many small nations strongly tied to
other EU countries, analogous to trade among state in
the U.S. But a layer of countries with economic
specialties traded globally – Germany: autos and
machinery; France: food and wine; Italy: travel & mfg;
UK – finance, …..
• Latin America – strong exports of raw materials,
linkages to Europe, strategies to promote “import
substitution.”
• Mexico – the largest US trade partner – dominated by
petroleum, manufacturing, but a huge tourist trade
Key Trade Relations for Other
Countries and Country Groups (2)
• East Asia as the emergent source of exports in the
last several decades – Japan after WW-II
• The 4 Tigers: Taiwan, South Korea, Singapore,
Hong Kong – a view from the 1970’s to ca. 1990
• Displaced by China, Vietnam, Indonesia, India,
and other SE Asian countries in recent years as a
source of manufactured goods exports
• Today a realization by the less developed
countries in Asia that they must develop a robust
producer services sector to be globally
competitive; this is a huge challenge for the
centrally planned economies.
Key Trade Relations for Other Groups
of Countries (3)
• Australia – Small in population, rich in resources, the
Colonial connection
• India – In some ways quite unique among large global
economies (see next slide, from the previous edition
of this text)
• South Africa – shifting from raw materials and
manufacturing to services
• Russia – the rise of oligarchs, the stagnation of the
economy in a global context, uncertainty of its future
• The Middle East – clearly dominated by OPEC, but new
spinouts from oil wealth in services – hotels, airlines,
new cities
India – Exports & Imports
Very
Different
Mix of
Imports
And
Exports
Compared
To other
Countries
In the text
Does not capture the boom in services work being done in India – call
centers, software, and a host of advanced service activities. Very strong
higher education system – producing cadres of engineers & scientists
The next slides are from the previous
edition of the textbook
• They are a reasonable proxy for current data
Trade Flows in Microelectronics
Numbers in
the text
do not
correspond
to the
values in
this figure
Dominated by Mexico
And East Asia
Trade Flows in Automobiles
Dropping
as domestic
production
by Japanese
firms rises
Mostly
From
Mexico
Again, numbers
in figure differ
from those
in the text
Global Rise of Japanese Auto
Manufacturers
Figure 13.14documents the global production presence of GM and Ford
Global Trade in Steel
Strong exports
From Japan
And EU:
A capitalIntensive sector
?Lack of
Intra-country
data &
data differ
from text
Global Trade in Textiles and Clothing
Clearly huge
Exports from
The developing
World to all
Developed
Economies, due
To labor
Intensity
See Figure 13.31
Global Trade in Grains and Feed
Reduced
trade in grains
and feeds as
many nations
have developed
capacity in
these sectors
Exports partly
governed by
global climate
and opportunities
to exploit scale
economies in
areas with high
yields
Trade in Non-oil Commodities
As in the
colonial past,
developing
countries are
the primary
sources of
these commodities,
but resource-rich
developed
economies such as
the U.S. and
Canada also have
significant
exports
Includes:
Imetals,
Iores,
crude rubber,
wood and pulp,
hides,
cotton fiber &
other textile
fibers,
crude animal
and vegetable
materials