global trading environment

8/10/2019 Global Trading Environment

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Global Trading Environment

AndRecent Trade

Made By:Tushar Chawla

MB12D16


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Major Economies of the World

With their GDP (PPP).

United States - $15.6 trillion

China - $12.4 trillion

India - $4.8 trillion

Japan - $4.5 trillion

Russia - $3.4 trillion


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WHAT IS GLOBAL TRADINGENVIRONMENT???

Refers to Exchange of capital, goods, and

services across international borders.

Represents a share of GDP.

Guiding Principle of global trade is comparativeadvantage.


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UNITED STATES OF AMERICA

World's largest national economy since the1920s.

Second-largest trading nation in the world behind

China.

Worldsthird largest exporter, after the European

Union and China.

60% of funds used in international trade are U.S.

dollars.


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15.30%

14.60%

13.30%

5.30%4.20%

2.80%2.60%

41.90%

Trading Partners of US.

Canada

China

Mexico

Japan

Germany

South Korea

United Kingdom

Others ( Brazil , Taiwan , India,Netherlands,Italy,


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27.90%

24.80%

11.80%

9.40%

8.60%

7.60%

6.10% 3.80%

Exports of USA (2012):

$1.564 trillion

Capital Goods

Industrial Supplies

Consumer Goods

Automotive vehicles and

components

Food and beverages

Fuel , oil and petroleumproducts

Aircraft and components

Others


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22.70%

18.70%

18.40%

13.70%

13.10%

5.40%

4.80%3.10%

Imports of USA (2012):$2.299 trillion

Consumer Goods

Capital Goods

Industrial Supplies

Crude Oil

Automative vehicles and

components

Computers and Accessories

Food and beverages

Others


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China

World's second largest economy by nominal

GDP and by purchasing power parity .

China is also the largest exporter .

Second largest importer of goods in the world

The world's fastest-growing major economy,with growth rates averaging 10% over the past

30 years.


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Exports $ 1906.08 million

Imports - $ 1620.90 million

Balance of Trade - $ 285.18 million.

From 2004 to 2009 Chinas annual trade surplus has

increased 10 times.

Export includes apparel , textiles , iron ore , steel , opticaland medical equipments.

Major Export partners are

United States 17.2 %

Hong Kong 15.8%

Japan 7.4%

South Korea- 4.3%


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INDIA

Third-largest by purchasing power parity (PPP).

One of the G-20 major economies and a member

of BRICS.

India is the 19th-largest exporter and the 10th-

largest importer in the world.

India's Gross Domestic Product grew at 4.4 percent

in the second quarter of 2013- worst quarterly rate

since 2002.


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Indiasimports Rs 2342.13 billionIndiasexports Rs 1652.02 billion

Trade deficit - Rs 690.11 billion

Export includes software , petrochemicals,

pharmaceuticals , textiles , precious stones ,

machinery , iron ore.Import includes crude oil , coal , fertilizer , gold

, chemicals.


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Export Partners

Column1

U.S.AU.A.E

China

Singapore

Hong Kong

Japan


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Japan

Fourth largest by Purchasing Power Parity [10].

The world's second largest developed economy.

World's 3rd largest automobile manufacturing

country.

Exports include motor vehicles, iron and steel

products , auto parts , plastic materials.

Import Includes petroleum , liquid natural gas, coal,

semiconductors . Export to China ( 18%)

United States ( 17.7%)South Korea ( 7.7%)Thailand ( 5.5%)

Hong Kong (5.1%)


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Imports from China (21.3%)United States (8.8%)Australia ( 6.4%)

Saudi Arabia (6.2%)United Arab Emirates (5%)

Exports JPY 5783.71 billion Imports - JPY 6744.04 billion Trade deficit 960.33 billion


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RUSSIA

Fifth largest by purchasing power parity.

Russia's oil and gas production and pipeline projects have

been a primary source of Russia's economic growth.

Abundance of natural resources, including timber, preciousmetals, and particularly fossil fuels (oil, natural gas, and

coal).

Exports petroleum and petroleum products, natural gas,metals, wood to Netherlands, China , Italy , Germany.


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Imports machinery, vehicles, meat , fruits

and nut , optical instruments , iron , steel

from majorly China , Germany and Ukraine.Exports - $ 43455 million

Imports - $ 30144 million

Trade surplus - $ 13311 million


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Recent Trends in

World Trade


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Chinasexport rose 7.2% in Aug and imports rose by 7%.

Manufacturing Sector regained momentum, and service sector was at

five monthshigh.

Global oil prices rose; due to turbulence in Libya and prospects on

Syria.

GDP growth for oil companies declined.

WTO has slashed its forecast forIndias

global trade growth to 3.3%in 2013 from 4.5% .

Called for strengthening the multilateral system to enable trade to

emerge as an engine to growth.

Trade growth is expected to remain sluggish in 2013 as the economicslowdown in Europe continues to suppress global import demand.

Global trade growth may touch 5% in 2014.


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India & Japan have expanded bilateral currency swap to $ 5 billion.

They had inked bilateral swap agreement for $15 bn on 4 Dec 2012.

Lead to more dollar flows.

Russia has lifted the ban on imports of rice and peanuts after 9

months.

A positive impact on Indias export and better trade relations.


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Petroleum Minister plans to lower dollar

outflow Crude Oil Payments.

Expected to import 11mn tones at an avg

of $105 per barrel .i.e. $8.47 billion.India imports 44% of its crude oil from

Iran, as a set of against Irans import(

Rice).


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US Federal Reserves QuantitativeEasing.

A third round of quantitative easing, QE3, was

announced on 13 September 2012.

Launched a new $40 billion per month, open-endedbond purchasing program of agency mortgage-backed

securities..

On 12 December 2012, amount of open-ended

purchases increased from $40 billion to $85 billion per

month.

On 18 September 2013, the Fed decided to hold off

on scaling back its bond-buying program.


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QEs Impact on US-

Higher inflation than desired.Can fail to spur demand.

May depreciate USsexchange rates versus other

currencies.

Does not necessarily increase the

aggregated money supply.

But inflationary risks are mitigated if the

system's economy outgrows the pace of the

increase of the money supply from easing.


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Impact on Emerging Asia

Increase in Foreign exchange reserves .

During QE 1 -Capital inflow of $9 billion per

quarter .

Increase in the monetary base (in US dollar

terms).

During the QE2 period, the increase in the

monetary base was $19 billion per quarter .


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THANK YOU

global trading environment

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