Marketing

International Trade and Finance Speech Paper.


The balance of trade is the difference between the monetary value of exports and imports of output in an economy over a certain period. It is the relationship between a nation's imports and exports. A positive balance is known as a trade surplus if it consists of exporting more than is imported; a negative balance is referred to as a tradedeficit or, informally, a trade gap. The balance of trade is sometimes divided into a goods and a services balance.

When a trade deficit is in effect, the United States is purchasing more from another country than it is selling to that country. In the examples mentioned earlier, the United States may have a trade "surplus" with Jamaica but a trade "deficit" with China. This means more of America'smoney is going to China than Chinese money is coming to America. A trade deficit may mean that products made in America are becoming too costly for Americans to purchase, or it may mean that foreign products are made more cheaply and thus are more attractive to American consumers. Either way, American companies are forced to cut jobs, cut production or close altogether in the face of dwindlingsales. This means less jobs domestically and less money in consumers' pockets, which may reinforce the cycle of purchasing cheaply made imported items.
Trade Agreements can create opportunities for Americans and help to grow the U.S. economy.
USTR has principal responsibility for administering U.S. trade agreements. This involves monitoring our trading partners' implementation of trade agreementswith the United States, enforcing America's rights under those agreements, and negotiating and signing trade agreements that advance the President's trade policy.

The United States is Member of the World Trade Organization (WTO), and the Marrakesh Agreement Establishing the World Trade Organization (WTO Agreement) sets out rules governing trade among the WTO's 154 members. The United States andother WTO Members are currently engaged in Doha Development Round of world trade talks, and a strong, market-opening Doha agreement for both goods and services would be an important contribution to addressing the global economic crisis and helping to restore trade's role in leading economic growth and development.

The United States has free trade agreements (FTAs) in effect with 17 countries.These FTAs build on the foundation of the WTO Agreement, with more comprehensive and stronger disciplines than the WTO Agreement. Many of our FTAs are bilateral agreements between two governments. But some, like the North American Free Trade Agreement and the Dominican Republic-Central America-United States Free Trade Agreement, are multilateral agreements among several parties. Another importanttype of trade agreement is the Trade and Investment Framework Agreement. TIFAs provide frameworks for governments to discuss and resolve trade and investment issues at an early stage. These agreements are also a means to identify and work on capacity-building where appropriate.

A tariff or a quota increases the cost to the consumer. A tariff adds an additional cost to a product. As a result theconsumer loses. Sometimes the supplier loses. A supplier in a distant land has the retail cost of his product go up under a tariff. If people cannot afford the cost he will sell less. As a result he might lose. His workers might lose jobs if the product does not sell. His government might lose.

This is one of the leading arguments for protectionism; namely, that doing so protects domesticindustries and their workers' jobs. Labor unions and domestic industries often appeal to patriotism to marshal support for protectionist policies.
Advocates of protectionism contend that excessive free trade compromises national security by making nations too dependent on goods from other countries. They will then argue for protection of industries deemed vital to national security, such as steel...