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340 percent of its GDP!10 These trade statistics are relative to the country’s GDP. Inabsolute dollar terms, however, a small relative trade percentage of a large economystill translates into large volumes of trade (See Exhibit 2-2). As shown in the lastcolumn for exports and imports in Exhibit 2-2, the per-capita amount of exports andimports is another important statistic for marketing purposes as it represents, onaverage, how much involved or dependent each individual is on international trade.For instance, individuals (consumers and companies) in the United States andJapan—the world’s two largest economies—tend to be able to find domestic sources fortheir needs since their economies are diversified and extremely large. The U.S. percapita value of exports and imports is $4,532 and $2,190 in 2008. For Japan, its percapita value of exports and imports is $6,104 and $5,468, respectively. On the otherhand, individuals in smaller and rich economies tend to rely more heavily on internationaltrade, as illustrated by the Netherlands with the per capita exports and imports of$32,321 and $29,137, respectively. Although China’s overall exports and importsamounted to $1.47 trillion and $1.16 trillion, respectively, the per capita exportsand imports amounted to only $1,101 and $869, respectively, in 2008. One implicationof these figures is that the higher the per-capita trade, the more closely intertwined isthat country’s economy with the rest of the world. Intertwining of economies by theprocess of specialization due to international trade leads to job creation in both theexporting country and the importing country.However, beyond the simple figure of trade as a rising percentage of a nation’sGDP lies the more interesting question of what rising trade does to the economy of anation. A nation that is a successful trader—i.e., it makes goods and services that othernations buy and it buys goods and services from other nations—displays a naturalinclination to be competitive in the world market. The threat of a possible foreigncompetitor is a powerful incentive for firms and nations to invest in technology andmarkets in order to remain competitive. Also, apart from trade flows, foreign directinvestment, portfolio investment, and daily financial flows in the international money
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