Q. 175.0( 1 Vote )
Explain any five
The five bases of international trade are:
● The difference in natural resources: The world's natural resources are distributed unevenly due to the various differences mentioned below:
a) Geological structure: It helps in determining the base of the mineral resources and the differences in topography. Lowlands have greater agriculture potential as compared to others. Similarly, mountains attract more tourists as compared to other landforms.
b) Mineral resources: These are also unevenly distributed all over the world. Industries usually prefer to set up on the basis of availability of mineral resources near them.
c) Climate: It influences the type of flora and fauna that can survive over there. It ensures diversity in projects. For example, wool production can take place in cold Areas whereas cocoa production can take place in tropical regions.
● Population: The size of the country along with the distribution and diversity of people affect the type and volume of goods traded between them.
a) Cultural factor: There are certain forms of art and craft that are limited to one country. For example the carpets of Iran, leather work Of North Africa and porcelain of China.
b) size of population: The heavily populated countries have a larger volume of internal trade but less external trade. This is because maximum agriculture and industry production are consumed in the local market itself. Moreover, the living standard of people helps to determine the quality of goods imported. Countries with a lower standard of living cannot afford to buy many costly items.
● Stage of economic development: The nature of items depends upon the level of development the country is in. In countries with agriculture is dominant, agro products are exchanged for manufactured products. Similarly, in countries where industrialisation is popular, they export finished products and import raw materials.
● Foreign investment: It can help to increase the level of trade in developing countries where there is less capital required for the development of heavy engineering, mining and other activities. If the developing countries developed such capital intensive industries, the industrial Nation import foodstuff, mineral and other finished products.
● Transport: In the olden times due to lack of good transport that trade was restricted only to certain local areas. The only goods that were traded over a long distance with high-value items of gems, silk and spices. With the development of Railways and Airways, names of storage and preservation trade has improved.
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