Understanding the culture in a country or region in which you are doing business is a critical skill for the international business person. Without this knowledge, a successful outcome to the business venture can be in jeopardy.
The level of world output in any given year influences the level of international trade in that year. By this it means that the slower the world economy is the less international trade and the higher the economy the higher the volume of trade.
“Globalization” is a term that came into popular usage in the 1980’s to describe the increased movement of people, knowledge and ideas, and goods and money across national borders that has led to increased interconnectedness among the world’s populations, economically, politically, socially and culturally. Although globalization is often thought of in economic terms, this process has many social and political implications as well. Many in local communities associate globalization with modernization. At the global level, globalization is thought of in terms of the challenges it poses to the role of governments in international affairs and the global economy.
There are heated debates about globalization and its positive and negative effects. While globalization is thought of by many as having the potential to make societies richer through trade and to bring knowledge and information to people around the world, there are many others who perceive globalization as contributing to the exploitation of the poor by the rich, and as a threat to traditional cultures as the process of modernization changes societies. There are some who link the negative aspects of globalization to terrorism. To put a complicated discussion in simple terms, they argue that exploitative or declining conditions contribute to the lure of informal “extremist” networks that commit criminal or terrorist acts internationally. And thanks to today’s technology and integrated societies, these networks span throughout the world. It is in this sense that terrorism, too, is “globalized.”
Increasingly over the past two centuries, economic activity has become more globally oriented and integrated. Some economists argue that it is no longer meaningful to think in terms of national economies; international trade has become central to most local and domestic economies around the world.
Among the major high-income economies, sometimes referred to as the Organization of Economic Cooperation and Development (OECD) countries, 60 percent of the total economic production, or GDP, is associated with international trade. Thirty-four percent comes from trade between high-income and low-and middle-income nations. The final six percent of the total world trade comes from the merchandise trade between low-and middle income nations. This shows the low purchasing power of the worlds poorest nations and indicates their general lack of economic development. Economists project that, in the U.S., more than 50 percent of the new jobs created in this decade will be directly linked to the global economy.
The World Trade Organization (WTO) is the only global international organization dealing with the rules of trade between nations. At its heart are the WTO agreements, negotiated and signed by the bulk of the worlds trading nations and ratified in their parliaments. The goal is to help producers of goods and services, exporters, and importers conduct their business.
There are items in the U.S. I think we take for granted. Things we use everyday that if all international trade was stopped we would suffer for a short period, but none the less we would be without. In the United States we produce items that other countries need in order to produce products that they need. One example of something manufactured in the United States, is that of items for missile defense systems and airplane parts. Lockheed Martin Corporation was formed in March 1995 with the merger of two of the world’s premier technology companies, Lockheed Corporation and Martin Marietta Corporation. In 1996, Lockheed Martin completed its strategic combination with the defense electronics and systems integration businesses of Loral.
Lockheed Martin traces its roots back to the early days of flight. In 1909 aviation pioneer Glenn L. Martin organized a company around a modest airplane construction business and built it into a major airframe supplier to U.S. military and commercial customers. Martin Marietta was established in 1961 when the Glenn L. Martin Company merged with American-Marietta Corp., a leading supplier of building and road construction materials. In 1913, Allan and Malcolm Loughead (name later changed to Lockheed) flew the first Lockheed plane over San Francisco Bay. The modern Lockheed Corporation was formed in 1932 after the fledgling airplane company was reorganized.
‘The former Loral Corporation was founded in 1948 in New York City by William Lorenz and Leon Alpert as a small defense electronics firm that over the years grew into a multi-billion dollar firm. In sum, the new Lockheed Martin Corporation comprises all or portions of 17 heritage companies. While most of Lockheed Martin’s customers are within the United States, we serve customers on every continent in the world. Through direct sales, joint ventures, and other methods, Lockheed Martin provides products and services to vital institutions in dozen of countries.
Things in the United States that we use everyday that we would have to without would be oil and petroleum products. The United States consumes 25 percent of the world’s oil while producing just 5 percent of that total. There are more than 212 million cars, trucks and motorcycles on our roads today, and all but a very few are entirely dependent on gasoline. Americans have a voracious thirst for oil – it courses through our lives, as indispensable as the blood in our veins. We fill the tanks of our trucks, our mobile homes, our SUVs and sedans with little thought as to where the gasoline came from, how it got here, or when it might run out.
Yet although the United States is increasingly dependent on oil, we are not blessed with domestic sources of petroleum sufficient to fill our needs. The more our demand grows, the more we have to import oil from unstable parts of the world to meet our needs. At the height of the OPEC oil embargoes
in the 1970s, we imported only 36 percent of our petroleum needs. Today we import 56 percent, and the U.S. Energy Information Administration predicts our dependence on imported oil will grow to 70 percent by 2020.
The events of last September once again highlighted the danger of this growing dependence on imported petroleum – our oil supply is only as secure as its source. And while, for the most part, our lives are returning to normal, our energy policies need to change. It is time to break our tremendous dependence on foreign oil. ‘ Works cited: http://auto.howstuffworks.com/question417.htm
International trade is very important to all countries, from the poorest to the richest. As shown there is an importance to all foreign relations.