Impacts of Emerging Markets on Global Trade, Essay Example

Discuss the impact on international trade of emerging economies like those of Eastern Europe, India, and China.

The growth rate of industrialization in the emerging economies is very rapid and thus the flow of information in such economies is indeed efficient. It is important to note that the emerging economies have indeed increased globalization significantly. The emerging markets influence the global trade in different perspectives. These include changes in the world outputs, foreign trends, the commodity markets, and change in the patterns of foreign direct investments. It is important to note that the emerging markets have led to the increased presence of multinational companies in different countries in the world today (Levchenko & Zhang, 2013, p.480). The increased number of these multinationals spurs the world’s economic growth to greater heights. The major countries such as Japan, Europe, and Germany who are closer to the emerging markets (Brazil, Russia, India, and China) have greatly benefited.

The emerging markets are currently the leading importers of various goods and services. In this regard, the prices of goods and services from the exporters are relatively good thus economic growth stimulation. The emerging markets are at the brink of surpassing the renowned economic leaders such as the USA who were touted as controlling the world economy. There is increased demand of raw materials because of the emerging markets. Because of the emerging markets, globalization as well as the change in pattern of the foreign direct investments has increased significantly.

What can we expect from them in the next 20–50 years?

In the next 20-50 years, the emerging markets will be controlling the world’s economy. China for instance will be a leading player in the world’s global trade owing to its current building of strong ties with other economies. China for instance, never involves herself in unnecessary political wars and thus it is easier for them to infiltrate into different economies and take charge.

Reference

Levchenko, A. A., & Zhang, J. (2013). The Global Labor Market Impact of Emerging Giants: A Quantitative Assessment. IMF Economic Review, 61(3), 479-519.