INTERNATIONAL TRADE:
THE GAME OF NATIONS AND RESOURCES
Trade
has been as old as man himself, beginning from a local stage to its ‘climax’ at
the international arena. Theories on trade have also been established; these
theories which have seen modifications and adaptations include:
·
the classical theories
o the
absolute advantage
o the
comparative advantage
·
The Neoclassical theories
o The
Heckscher-Ohlin theory
o Rybcynski
o Stolper-Samuelson
Income Distribution theory
·
The Post Hecksher Ohlin
Theories
o Linder
Theory
o Product
life-cycle Theory
From
the foundational theory of comparative advantage, its proponent- David Ricardo
made us realize that trade was still feasible between nations producing similar
products through specialization and the Heckscher Ohlin theories expatiate further in clarifying the significance of factor
endowments. Now I’d like us to look at some nations of the world, their
resources and their trading partners.
The
World Trade Organization (WTO) define natural resources as “stocks of materials that exist in the natural environment
that are both scarce and economically useful in production or consumption, either
in their raw state or after a minimal amount of processing”
There are however certain features associated with natural
resources, these include;
1. Exhaustibility
2. Uneven
distribution across countries
3. Negative
externalities consequences in other areas,
4. Dominance
within national economies
5. Price
volatility.
Charity
must begin at home, so we kick off with Nigeria
NIGERIA
Apart
from oil (which serves as the major source of the nation’s revenue, which is
about 90%) we have other resources such as Tin, Columbite, Iron ore, Lignite
(brown coal) and Limestone.
According
to the WTO trade report, Nigeria has exports composed of Agricultural, fuels
and mining and manufacturing products to the tune of 5%, 88.5% and 2.6%
respectively. Its export trading partners include United States, European
Union, India, Brazil and Equatorial Guinea.
GHANA
Ghana
also trades Cocoa, Gold, Daimns adn bauxite. Its trade exports composed of
Agricultural, fuels and mining and manufacturing products are the tune of 27.8%,
59.3% and 12.9%. The main destinations of its exports are the European Union
(25.7%), Togo (25%), South Africa (17.1%), United Arab Emirates (5.4%) and
Switzerland (4.7%)
U.S.A.
Having
Coal, Oil, Iron and Steel. It exports proportion of Agriculture, Fuels and
Mining and Manufactured products are 11.4%, 12.5% and 65.3% with its exports
destination finding its way in Canada (19%), European Union (18.2%), Mexico (13.4%),
China (7%) and Japan (4.5%).
CHINA
The
Predicted Future World Economic giant is rich in Iron metals, Aluminum, Tin,
Antimony, mercury, Tungsten Manganese, Lead, Zinc and Copper. It also has
deposits of oil and natural gas Its exports of Agriculture, Fuels and Mining
and Manufactured products are 3.4%, 3.1% and 93.3% respectively while its
export destinations are the European Union (18.8%), United States (17.1%), Hong
Kong (14.1%), Japan (7.8%) and the
Republic of Korea (4.4%).
GERMANY
The
Economic giant of the European Union has large deposits of Coal and Steel and
is a rich grower of Cereal and Potato crops. Its commodity export proportion of
Agriculture, fuels and Mining and Manufactured products are 6.4%, 5.9% and
85.3% with their destinations to the following countries: European Union
(58.2%), United States (7%), China (6.1%), Switzerland (4.5%), and Russian
Federation (3.3%)
