Why international trade is important 2020

International trade allows countries to exchange goods and services with money as a medium of exchange. The benefits of international trade have been the main drivers of growth in recent decades.

Why international trade is important 2020
Why international trade is important 2020

Countries with strong international trade are prosperous and have the power to control the global economy. World trade can become one of the most important factors in reducing poverty.

Types of international trade

There are three types of international trade: export trade, import trade and commercial warehouse. The warehouse trade is a combination of export and import trade and is also known as re-export. This means importing goods from one country and exporting them to another country for added value.

Reasons for international trade

Countries turn to international trade when there are insufficient resources or capacities to meet domestic demand. By importing the necessary goods, a country can thus use its national resources to produce what it produces better. Then the country can export the surplus to the international market. A country mainly imports goods and services for the following reasons:


If foreign companies can produce or provide goods and services at a lower cost, it may be advantageous to trade abroad.


When companies can offer high quality goods and services abroad. For example, Scotch whiskey from Scotland is considered superior.


If it is impossible to manufacture this product in the domestic market, an example is a special type of fruit or minerals. Country like Japan has no natural oil reserves and imports all of its oil.


If the demand for a product or service in a country exceeds national production, it is imported.

The importance of international trade

More choice of goods for consumption:

International trade introduces different varieties of a particular product from different destinations. This offers consumers a wider range of opportunities to not only improve their quality of life, but to grow the country as a whole.

Promotes production efficiency:

International trade promotes production efficiency as countries use better production methods to cut costs and remain competitive. Countries that can produce a product at lower cost can gain a larger market share.

Creation of more jobs:

With the country’s growing commodity market through trade, more jobs could be created. International trade helps create more jobs by creating new industries to meet the needs of different countries. This will help countries reduce their unemployment rate.

Reduces trade fluctuations:

By expanding the market with large inventories and high demand, international trade reduces trade volatility. Commodity prices tend to remain more stable.

Use of excess products:

Through international trade, various countries can sell their surplus products to other countries and earn foreign exchange.

Lower costs

International trade allows a country to consume products that cannot be produced domestically or whose production can be very expensive. This makes the import from other countries cheaper by foreign trade.

Promotes peace and goodwill:

International trade promotes peace, goodwill and mutual understanding between nations. The economic interdependence of the countries often leads to close cultural relations and thus avoids a war between them.

Forex Trade

Beginners guide on how to make money via forex trade 2020

Foreign exchange transactions are very different from the stock market. In order to participate in foreign exchange trading and to make a fortune, you must carefully analyze the technical and fundamental characteristics of trading. There are many learning materials on the market that will help you learn the tricks of the trade and become the best investor in the market. These study documents would convey a basic idea of ​​the business and improve your business skills.

Beginners guide on how to make money via forex trade 2020
Beginners guide on how to make money via forex trade 2020

This will give you a good overview of the current global market trends, market risks and various currency effects. No matter if beginner or forex trading expert, these learning tools will help both. You will learn how to use the latest software and other forex trading tools. They will find basic ideas and technical knowledge about the trade as well as risk management, market analysis, rules, market indicators, the trading environment and global markets.

What is forex?

The foreign exchange or foreign exchange market is the market on which the currencies are exchanged. For example, in the simplest form, a foreign exchange transaction may consist of a transfer of your local currency for future holidays to a new one. An estimation of more than $ 5.3 billion is traded daily between governments, banks, corporations and speculators.

Listed below are tips on how to make money on forex trade

Learn more about the financial markets

Before you start trading, you need to know the different types of markets and the market that interests you the most. In addition to trading in currencies, you can also consider trading in commodities, indices, and stocks. The best way to learn more about a market is to know why others believe that the market is changing and what different catalysts can cause the price or the exchange rate to fluctuate in a particular direction.

Learn how to do your own analysis

Forex traders typically focus on two types of analysis, which include fundamental and technical analysis. Basic analysis is the study of macro events that will change the price of a currency pair. The technical analysis examines price developments, including momentum, trends and reversal patterns.

Find a good broker

A forex broker handles the execution of transactions. While this is their most important function, a broker has many features that you should know before you deposit money with this broker. Look for the notifications from your potential broker and make sure there are no red flags. Fraud warnings or withdrawal issues are most important. They also want to make sure that there is effective customer service.

Start with a demo account

Most reputable brokers offer you real money accounts as well as demo accounts. A demo account is an account on which you trade paper money, no actual capital. Most good demo accounts offer almost all products for a real money account.


Before you trade in the foreign exchange market, you need to take several steps. You must first know the financial markets and the type of information you need before you start trading. Try to learn both basic and technical analysis. Find a forex broker that you believe is trustworthy and provides a wealth of information. Use a demo account before you risk real money.