This paper analyzes the international trade policy and global monetary systems. International trade allows countries to expand their markets for both goods and services that are not available domestically. As a result of international trade, the market is more competitive which results in more competitive pricing which brings a cheaper product home to the consumer. This trade is key to the rise of the global economy through import and export. The global monetary system is a set of internationally agreed conventions and rules supporting institutions that facilitate international trade and cross border investments.
international trade policy and global monetary systems
THE OBJECTIVES OF INTERNATIONAL TRADE POLICY
The international trade policy has the following objectives. Therefore, it ensures that businesses have a fair opportunity to compete for both domestic and international markets. It also breaks down unfair trade barriers blocking import and export. It maintains a balance that looks out for the interests of all segments of an economy. The policy also enforces laws and a global monetary system that prevents the distortion of the market and subsidizing exports. The policy aims at updating current trade agreements as necessary to reflect changing market conditions and times. It also enforces labor provisions and prohibits the sale of goods made with forced labor.
objectives of international trade policy
THE TYPES OF GLOBAL MONETARY SYSTEMS
There are three main types of global monetary systems. Commodity money, commodity-based money, and fiat money. Commodity money is from precious metals and commodities. This uses the commodity in terms of currency for example gold and silver. Commodity based money is where the money draws its value from a commodity but doesn’t involve handling the commodity. For example, the US dollar used to draw its value from gold (gold standard). The fiat money which is the common monetary system uses paper currency and base metal coins. It is the system used in the international trade policy through bank balances. Most import and export activities use this system.
the types of global monetary systems
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