Introduction of foreign trade Background What is Trade? Meaning and Nature Different Types of Trade Internal and External trade Advantages and Disadvantages of International Trade Importance/Role of foreign trade in economic development of countries

1. KAZIM ARMAN
B.s ECONOMICS
FOREIGN TRADE

2. FOREIGN TRADE
 Introduction of foreign trade
 Background
 What is Trade? Meaning and Nature
 Different Types of Trade
 Internal and External trade
 Advantages and Disadvantages of International Trade
 Importance/Role of foreign trade in economic
development of countries

3. Introduction of foreign trade
 There is no country in the world today which produces
all the commodities it needs.
 therefore, tries to produce those commodities in which
it has comparative advantage.
 It exchanges part of those commodities.
 The relative difference in factor endowments,
technology, tastes etc.
 nations of the world have greatly widened the basis of
international trade.

4.  Pakistan has bilateral and multilateral trade
agreements
 . It is a member of the world Organization.
 The trade deficit for the fiscal year 2013/14
is $7.743 billion.
 Exports is $10.367 billion in July–November
2013and imports is $18.110 billion
 Pakistan's exports continue to be dominated
by cotton textiles

5.  Trade refers to buying and selling of goods and services.
 It involves transfer or exchange of goods and services
for money.
 The manufacturers or producer produces the goods.
 Trade is essential for satisfaction of human wants.
 Trade is an important social activity because the society
needs uninterrupted supply of goods.
 Trade has taken birth with the beginning of human life.
 Thus we can say that trade is a very important social
activity.

6. Different Types of Trade
1. Internal or Home or Domestic trade.
 It is conducted within the political and geographical
boundaries of a country.
 It can be at local level, regional level or national
level.
2. External trade
 It refers to buying and selling between two or more
countries. For instance.
 If Mr.Ali who is a trader from GilGit, sells his goods
to Mr.Ahmad another trader from New York then
this is an example of foreign trade

7. 1. Advantages of International Trade
 Optimal use of natural resources
 Availability of all types of goods
 Specialisation
 Advantages of large-scale production

8.  Impediment in the Development of Home
Industries
 Economic Dependence
 Political Dependence
 Miss-utilisation of Natural Resources
 Import of Harmful Goods

9. Importance/Role of foreign trade in
economic development of countries
 Foreign trade and economic development
 Foreign exchange earning
 Market expansion
 Increase in investment
 Foreign investment
 Increase in national income
 Decrease in unemployment