Lesson 2 Trading Flows - Trading Patterns

Trading Flows
& Trading
Patterns
OBJECTIVES:
-DEFINE VISIBLE AND INVISIBLE
I M P O RT S / E X P O RT S
- D E F I N E PAT T E R N S O F T R A D E F L O W S
DEFINE INEQUALITIES OF TRADE FLOWS
Patterns?
To investigate the pattern of trade we will consider:
-What are the overall trends in global trade

-What are the most common products traded
-Spatial distribution of global trade (HICs/LICs)
……are there any inequalities?

DESCRIBE THE GROWTH IN TRADE OF GOODS AND
SERVICES (4)
Focus on these areas
Click icon to The
addvalue
picture
of global trade in goods increased
from less than $8 trillion in 2003 to more
than $18.5 trillion in 2013.
This is a growth of $10.5 trillion in 10 years.
Trade is serviced also increased significantly
from $2 trillion in 2003 to $4.7 trillion in
2013.
Describe the growth in trade of goods and services

(4)
In both 2003 and 2013, the value of world
Click icon to trade
add services
picturewas approximately a quarter
that of global trade in goods.
The severe dip in the trade in goods in 2008-
09 indicates the strong effect of the global
financial crisis on world trade.
The dip in trade services was much lower.
Describe the growth in trade of goods and services

(4)
RECAP: Growth in world trade
What has
happened to the What was the growth
value of global difference between
trade? 2003-2013 in goods?
What are the main

differences between the What was the growth
growth of goods and
difference between
services?
2003-2013 in services
What are the most
important products of the
(Goods) global trade network?
Merchandise dominates, with exports

totalling $18,301 billion in 2013. Here,
manufactured goods dominate,
followed by fuels and mining products
and then agriculture. Machinery and
transport equipment is by far the most
important element of manufactured
goods. For commercial services, travel
and transport dominate.
Spatial Distribution of global trade
Look at tables 13.2 and

Visible and invisible trade is dominated by the countries of 13.3 which shows the
North America, western Europe and Asia. world’s leading exporting
and leading importing
countries. Which ones have
trade surpluses and which
have trade deficits?
• •
• •
• •
• •
• •
Spatial Distribution of Visible Trade
What does the table tell you? Write on
and around the table
Start of by looking at the patterns
generically, then the data and anomalies
Spatial Distribution of Visible Trade
• Every single country in Africa is in the
lowest class (under $250 billion). This
class includes countries in the middle east,
western and central Asia, Latin America
and eastern Europe
• Brazil and Mexico are the only countries
in Latin America outside of the lowest
class
• The countries of south east Asia are in the
lower two classes along with Australia and
New Zealand
• The major trading nations (two higher
classes) are in north America, Europe and
East Asia. This group also includes the
Russian Federation, India and Saudi
Arabia
What does the map tell you? Write on and around the map
Start of by looking at the patterns generically, then the data and anomalies
Spatial Distribution of Visible trade
• Today LICs are no longer simply the providers
of primary produce and receivers of
manufactured goods and services. They do
specialise in an aspect of manufacturing,
sometimes as part of TNC
• Nevertheless, many LICs are primary product

dependent ie. they obtain foreign currency by
exporting a small range of primary products at
low prices compared with the prices of
manufactured goods/services.
• LICs share of total global merchandise exports

totalled 1.1% compared to 75% of G20
Spatial Distribution of invisible trade
The top 10 countries in world trade in commercial
services represent half of commercial service trade in
2013.
LDCs have shown pleasing progress. Between 2000-

2013 trade in services in LDCs grew by 14% per year.
-Cambodia from tourism
-Ethiopia expansion of air transport services
However, such increases are from an extremely low

base and LDCs only share 0.7% of world export
commercial services in 2013.
Recent trends also see a decline in share of North

American and Europe and increases in Asia. Asia rose
from 21.7% to 26.2% whilst Europe’s share fell from
51.8* to 47.2%
Spatial Distribution of Invisible Trade
What does the table tell you? Write

on and around the table
Start of by looking at the patterns
generically, then the data and
anomalies
Summary- Describe the patterns in trade flows
The value of global trade in goods increased from less than $8 trillion in 2003 to
more than $18.5 trillion in 2013.
Overall Trade Growth This is a growth of $10.5 trillion in 10 years.
Trade is serviced also increased significantly from $2 trillion in 2003 to $4.7
trillion in 2013.
Merchandise dominates, with exports totalling $18,301 billion in 2013. Here,

manufactured goods dominate, followed by fuels and mining products and then
Most common products
agriculture. Machinery and transport equipment is by far the most important
element of manufactured goods. For commercial services, travel and transport
dominate.
Both invisible and visible trade is dominated by North America, Europe and Asia.
For value of total goods traded, every single country in Africa is in the lowest class
(under $250 billion). LICs share of total global merchandise exports totalled 1.1%
Spatial Distribution compared to 75% of G20. With regards to commercial trade. LDCs only share
0.7% of world export commercial services in 2013. The top 10 countries in world
trade in commercial services represent half of commercial service trade in 2013.
Define Inequalities of Trade Flows
The Value of global trade in goods has increased $18 trillion from 2003-2013 and $4.7t in services during the same period.
It can be argued that all countries have strongly benefited from this strong increase. However, evidence of unequal growth is clear when
analysing the Global Value of Goods traded in 2012. Every single country in Africa is the lowest class of value (under $250 billion) compared to
other regions in the world. The major trading nations are located in Europe, North America and East Asia. These regions have trade value in the
upper class ranks from $500-1000 billion and over $1000 billion.
When analysing the products of visible trade from figure 13.2, it is clear that LICs do specialise in manufacturing and are not just providers of
primary produce. For example, Africa contains $103 billion of manufactured goods and $67 billion in fuels and mining products. However, the
inequalities with other regions in the world are apparent when compared to Asia $4,419b and Europe $4734b respectively. In addition, inequality
between total global merchandise exports is emphasised further with all LICs shares totalling just 1.1% compared to 75% from G20 countries.
The unequal trend continues when considering Commercial services. In 2013, the top 10 countries in world trade commercial services
represented half of all commercial service trade. However, it can be argued that these inequalities are narrowing. LDCs have shown growth in
commercial services traded. Between 2003-2013 LDCs grew by 14% per year. Notable areas being Cambodia (from tourism) and Ethiopia (Air
transport Expansion). Further more, recent trends show declines in commercial trade across North America and Europe, with the latter falling
from 51.8% to 47.2%. However, despite these figures, it is clear that huge inequalities still exist in global trading between the richer regions of
Asia, North America and Europe in comparison to South America, Africa and parts of the Middle East.

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Trading Flows

-What are the overall trends in global trade

……are there any inequalities?

Describe the growth in trade of goods and services

Describe the growth in trade of goods and services

What are the main

Merchandise dominates, with exports

Look at tables 13.2 and

• Nevertheless, many LICs are primary product

• LICs share of total global merchandise exports

LDCs have shown pleasing progress. Between 2000-

However, such increases are from an extremely low

Recent trends also see a decline in share of North

What does the table tell you? Write

Merchandise dominates, with exports totalling $18,301 billion in 2013. Here,

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