AIMS

School of Merchant Marine

NGEC 3:
Video Analysis about Imports, Exports, and Exchange Rates
International trade is one of the key factors that make the world move forward as time
passed by. It helps most of the countries today to raise the living standards of their nation
through import and export. More importantly, international trade provides employment for
every country and enabling consumers to enjoy a greater variety of goods. With that, this
topic helped us - marine students - to understand the role of international trade, and why our
profession is vital in the global economy.
We can say that international trade is the lifeblood of the global economy. Through
the exchange of goods and services between countries, they create mutual gain in every
import and export they’ve done. Moreover, international trade promotes competition and
innovation that can significantly reduce the poverty level in a country. However, along with
the international trade comes its ugly part that, sometimes, those people who produce goods
and services overseas might experiencing unsafe and unfair working conditions, and also
causing environmental degradation.
International trade also helps us understand its comparative advantage, meaning, a
country’s specialization in producing specific goods since they are better at producing these
things and also for its lower opportunity cost. Even if one country can produce two goods at
a lower absolute cost – doesn’t mean they should produce everything. One example of this
is here in the Philippines, since, we are abundant in products like coconut, mangoes, and,
coffee beans, consequently, we have a comparative advantage to export this product to
other countries and it would be efficient for us to continuously produce and export these
products.
On the other hand, through the import and export of a country, trade deficit also does
happen. Basically, it is the negative balance of a country’s net exports. So, if a country has
more imports than it exports, it would mean that that country consumed and spent a lot of
goods from other countries than it produces and exported from other countries. Despite that
trade deficit allows a country to consume more than it produces which in turn help nations to
avoid shortages of goods and other economic problems. However, trade deficits can create
substantial problems in the long run. The worst and most obvious problem is that trade
deficits can facilitate a sort of economic colonization. If a country continually runs trade
deficits, citizens of other countries acquire funds to buy up capital in that nation.
In general, international trade has been an important factor in promoting economic
growth. It helped different nations to develop their own natural resources and to participate in
the global economy. We must understand that international trade is essential since it allows
countries to turn “unneeded” resources into money or other “needed” resources together
with the other countries. Participating in the global economy not only allows consumers to
receive goods and services at the best prices, but it is also an essential part of a nation
relating to other nations on a sovereign basis. Countries requires interaction with one
another to be recognized by the international community. International trade shows a
commitment to being a part of the international community and a resolution to working with
other nations in a peaceful and reasonable way.