Chapter 2 - The dynamic environment of international trade. What you should learn from chapter 2: The basis for the reestablishment of world trade following World War II, the importance of balance-of-payment fi gures to a country’s economy, the effects of protectionism on world trade, the several types of trade barriers, the provisions of the Omnibus Trade and Competitiveness Act,. | International Marketing 15th edition Philip R. Cateora, Mary C. Gilly, and John L. Graham Top Ten 2009 . Trading Partners ($ billions, merchandise trade) Roy Philip Exhibit Beyond the First Decade of the 21st Century (1 of 2) Growth of the . economy slowed dramatically in the last few years especially in 2009 Economies of the developed world expected on average to grow annually at 3% for the next 25 years (OECD) Economies of the developing world expected on average to grow annually at 6% for the next 25 years (OECD) As a result, economic power and influence will move away from industrialized nations to developing nations (Latin America, Asia, Eastern Europe, and Africa) Roy Philip Opening Side Beyond the First Decade of the 21st Century (2 of 2) Companies are looking for ways to become more efficient, improve productivity, and expand their global reach while maintaining an ability to respond quickly and deliver products that the markets demand. Nestle, Samsung, Whirlpool Smaller companies also using novel approaches to target global markets Nochar Inc. (fire retardant) Buztronics Inc. (promotional lapel buttons) Roy Philip Opening Side Protection Logic and Illogic Arguments for protectionism: Protection of infant industry Protection of the home market Need to keep money at home Encouragement of capital accumulation Maintenance of the standard of living and real wages Conservation of natural resources Industrialization of a low-wage nation Maintenance of employment and reduction of unemployment National defense Increase of business size Retaliation and bargaining Roy Philip Opening Side Does Protectionism Help? A recent study on 21 protected industries showed that while jobs are protected, consumers pay much higher prices because of protectionism: . consumers pay about $70 billion per year in higher prices because of tariffs and other protective restrictions. At the same time, the average cost to consumers for . | International Marketing 15th edition Philip R. Cateora, Mary C. Gilly, and John L. Graham Top Ten 2009 . Trading Partners ($ billions, merchandise trade) Roy Philip Exhibit Beyond the First Decade of the 21st Century (1 of 2) Growth of the . economy slowed dramatically in the last few years especially in 2009 Economies of the developed world expected on average to grow annually at 3% for the next 25 years (OECD) Economies of the developing world expected on average to grow annually at 6% for the next 25 years (OECD) As a result, economic power and influence will move away from industrialized nations to developing nations (Latin America, Asia, Eastern Europe, and Africa) Roy Philip Opening Side Beyond the First Decade of the 21st Century (2 of 2) Companies are looking for ways to become more efficient, improve productivity, and expand their global reach while maintaining an ability to respond quickly and deliver products that the markets demand. Nestle,
