TRADE and investment

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OLUFEMI OMOYELE

I get very excited when talking about Trade and Investment, what drives trade and how investment is mobilized. In my last paper I provided a personal background on how Trade and investment forms a strategic part of applied Government Policy which in turn is a pillar in National Development Strategy.

Globalization: We cannot talk about trade without understanding the role of Globalization. If you talk to the people who camp outside every WTO meeting to protest against Globalization. They will tell you that Globalization is killing poor people and it is taking jobs away and so on and so forth. They will tell you that Globalization is a modern-day evil and Monster that must be dealt with. These same campaigners are anti-Global Markets, GLOBAL Government cooperation, and they hate the World Economic Forum. That is why the World Economic Forum is held in Davos, Switzerland every year. Davos is easily the coldest and most difficult place to get to if you are not on the guest list, you cannot gain entry and if you do not want to freeze to death, you will not be protesting outside a meeting in Davos.

However, what these protesters will not tell you is that Globalization has been going on in this word for thousands of years. For as long as human beings learnt how to travel, they have been trading with each other over vast distances. The great silk trade of ancient times which was promoted by the ancient Chinese was a clear global market trade. The slave trade which decimated Africa and for which over four hundred million Africans were traded like goats and sheep was also a global market trade. The Ancient Prussians, the Egyptians, the Greek all were involved in global market trading and so Globalization is a very old phenomenon. The only difference today and for which the ancients did not have is TECHNOLOGY. Technology allows us to tell what the Thailand people are selling their rice and we can compare prices to the Indians. Technology allows us to tell exactly what an entire Nation is buying, from who and in what quantities. Technology allows us to consummate trade transactions without leaving the shores of our own country.

Global Market Trade: I still get confused when people blame Globalization for their problems. I wonder what they want. Every Nation should be self-sufficient in everything they use, eat and wear? That is simply not possible. Global Market Trade is essential to modern living. Goods get produced in the most efficient site, by the most efficient producers using the most efficient method of deploring capital, labor and technology, and that is Globalization at its best. Nations or people who complain about Globalization are doing so because they have very inefficient systems, structures and operating environment and so they seek to lay blame elsewhere for their inefficiency. On the other hand, many nations have benefitted from Globalization, and these are very serious Nations with very serious Leaders. Mexico, Brazil, India, China, UAE, many nations of the Caribbean islands, Mauritius, Korea, Turkey, etc are all Nations that owe their rise and sustainable economic growth to Globalization. In Mexico, for instance, billions of dollars’ worth of consumer goods that are consumed in the United States are produced along the border towns under a project called the Maquiladora project. And after the signing of the North American Free Trade Agreement (NAFTA) by President Clinton, trade between Mexico, Canada and the United States opened up into a new world of opportunities of new wealth and jobs. Unfortunately, President Donald Trump is planning to revoke that agreement, however lets watch and see if he ever gets round to it, with all his other self-inflicted problems.

China and Korea with their great distance from the United States not withstanding were able to see Globalization for the benefits it promises and they positioned themselves to benefit by focusing their efforts on manufacturing the simple products and supplying the markets of the United states and Europe. In recent times though they are no longer satisfied with producing the simple products as they have moved up the value chain to making Cars, Ships, and even space technology such as Rockets and Satellites.

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