The economic development is the first and foremost criteria which classify any country as developed or under-developed nation. Modern warfare is the warfare of economy not just the warfare of weapons. Today the Super powers of the world are not the ones who are having stronger military strengths but they are the ones who are having stronger enough economies to maintain that military strength.Moving on to the word “Trade”, trade is not just the exchange of goods or money, trade can also be regarded as the exchange of services from one nation to another. Trade has been the engine that establishes International communication and sharing of knowledge. As Adam Smith wrote about International trade that it allows nations to focus on what they do best and that is a common explanation of the advantages of the trade.
Really small countries like Vatican city and Monaco would apparently have to merge with their large neighbors for the sake of better trade. A country gains when it is allowed to focus on its strengths and use the excess production to trade for item that it is less efficient in producing. Countries like United Kingdom who are technologically advanced and are having modern machinery rely on Asian countries who are having abundance in both skilled and unskilled labour. This can also be classified as a type of International Trade.As the time has progressed, competition has gone above in each and every field of the World. This has developed the need of designing modern techniques and procedures to carry out the work more effectively and efficiently.
Same goes with the trade. There are particular set of skills and characteristics which a trader must possess to turn out successful in International Market. Having the knowledge of International trade laws, being familiar with the market trends, learning the language of particular country where you intend to carry out your business; these are some key traits required. This will reduce the risk factor by multiple times.Risk in trade is a permanent element.
You can never reduce the risk factor to zero, but can only minimize it. In fact, risk assessment and management are the most work to be carried out by the traders to take their business to profitable success. Risk management comprises of accepting the risk or identifying the risk, secondly trying to avoid the risk by making new strategies or by changing the plan, thirdly you can mitigate the risk because mitigating against the risk is probably the most commonly used risk management technique. Another risk management strategy is to exploit the risk. By exploiting the risk we can also tackle many other problems which a particular risk can create to the organization or firm.