International trade is a form of cooperation in the economic sector to meet the needs of the country. The purpose of holding international trade is to establish cooperation with other countries so that it can be useful for meeting domestic needs.
An example of international trade is the trade in palm oil to several countries. Not all countries can produce palm oil, so it is for this concept that international trade is needed.
International trade
International trade is a trading relationship between two parties from different countries. This trade was agreed upon by two parties. Parties that can enter into international relations agreements are individuals, companies, and governments.
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International trade is a form of business that is usually carried out between countries. Cooperating countries usually exchange goods or services needed by other countries with the absolute advantage possessed by each country.
International trade can occur if the cooperation is carried out across national borders. The boundaries referred to include differences in language, currency, prices, and applicable laws.
Relations that exist between countries sometimes have a complicated relationship. The forms of relations that exist in international trade are usually the exchange of output from each country, the relationship of debt and credit, and the exchange of means of production.
International Trade Purposes
The following are some of the objectives of international trade which are partly of general benefit, including;
1. Protected Domestic Production
It is common knowledge that the process of creating international trade will provide a stimulus for protected domestic production, both in its use and in its management for sustainability.
2. Domestic Goods and Services Fulfilled
Efforts to overcome modern and classical economic problems are related to the limited goods or services in a country. It is through this process of international trade that all of these problems can be overcome in such a way.
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3. Increase the State’s Foreign Exchange
The process of establishing international cooperation through trade is to provide additional foreign exchange to a country. So that for this advantage no country avoids trade in the international world.
4. Get Benefits Apart from the Economic Sector
Increased cooperation within a country is recognized or not due to international trade, so that upon the conclusion of this agreement later this cooperation also encourages other actions such as actions to increase tourism, defense, and so on.
5. Giving a Boost to Population Quality
The existence of international trade carried out by various countries provides impetus for a better quality of population, in this corridor, for example, the existence of developed countries such as China is because their trade is well known in the world.
Examples of International Trade
To provide further explanation, here are some examples of international trade being implemented in Indonesia, including;
1. Export and Import
International trade with exports and imports is usually carried out by several countries. This export-import activity is better known by the public than any other international trade activity.
Example: exports of palm oil, textiles, rubber, cocoa, and coffee beans. Imports in the form of experts or other capital goods used by companies.
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2. Consignment
The activity of selling goods by sending goods abroad where the buyer is not clear. This activity is usually carried out in the free market.
For example: clothes, toys, and shoes with a certain brand.
3. Barter
This activity is still often carried out by applying certain types of barter. Barter is usually done in the form of goods of great value and concerns the common interest.
4. Package deal
Trade conducted with trade agreements with other countries. This agreement intends to expand the international market.
5. Copyright License
A study of licenses and copyrights that usually occurs from country A companies then grants licenses to use trademarks, patents or copyrights to companies in country B, of course enabling companies in country B to produce and market products with brands or technology owned by companies in country A. This aims to empower the community for country B.
That was a series of explanations and reviews that we can write to all readers regarding the objectives of international trade in general and an example in Indonesia. Hopefully it can provide insight and in-depth education.