As barriers to trade are removed, some products may be cheaper to purchase abroad than domestically. This is why job losses are likely, as less competitive sectors are neglected. While most economists say that this workforce can be attributed to more efficient industries, in which the United States has a comparative advantage and this benefits the country as a whole, it is not always likely or practical. In addition, these adjustments are easier to make in the long term than in the short term. It is not always easy for someone who has worked all his life in a factory to start a new career as an IT specialist. International trade can have adverse effects on a country`s consumption behaviour due to the importation of cheap and sometimes harmful goods. Indian handicrafts have suffered a serious relapse due to free trade and the unrestricted importation of English textiles. 6. Free trade is not just about consumer goods. At least 50% of U.S.
imports per year are not consumer products. These are inputs for U.S.-based producers to reduce domestic production costs. This advantage also promotes economic growth by diversifying the supply chain for an organization of all sizes. Even micro-enterprises, freelancers and entertainment specialists can benefit from this advantage, as the internet offers immediate access to cheaper goods, new research and an extension of service. International trade leads to fundamental changes in the quality of work and capital in trading countries. Trade changes the quality of people teaches them to consume new things, even using old things in a new way, changing technical knowledge leads to specialization, etc. International trade has a negative impact on the development of domestic industry. It is a threat to the survival of local child industries.
Due to foreign competition and unlimited imports, future industries could collapse in the country. When underdeveloped countries take their sustainability into account in foreign imports, they decline rapidly when shipments decline or prices rise. This can also happen in rich countries, which feed the economies of information and skilled labour, not trade in goods. Bieler, A., Morton, A. D. (2014). Unequal and combined development and unequal exchanges: the second wind of neoliberal “free trade”? Globalizations, 11 (1), 35-45. Foreign trade leads to specialization and promotes the production of various products in different countries. Products can be manufactured at a relatively low cost due to the benefits of the division of labour.
The impact of the global operational enterprise and modern business practices were discussed on this subject. It is therefore possible to conclude that it is necessary to effectively identify the risks encountered both nationally and internationally.