Reflective Statement on Legal practices Influencing International Trade
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I have learnt that legal practices influence how international trade is run. In the world, there are different cultures that have brought about different governments hence different laws. Some countries conglomerate and form a bloc such as the European Union. (Ball & et.al, 2013), explains that the European Union comes up with laws that will govern trade across the member countries as one whole. I have realized that some laws in a country may not be favorable for foreign investors. A familiar case is the antitrust laws in the United States that will repel some foreign investors who are not welcome to the idea of having to pay for damages caused by their product on the basis of being punished or due to the sympathy of a jury.
I have learned through the study of this text that another influencer of international trade is the currency. Currency values fluctuate, this is common, but various level of fluctuation may lead to great impacts on financial transactions. The fluctuations may also lead to the change in the cost of production of an item and in extension, the price of the commodity. The valuation of a business may be affected by the value of currency in a country within which they operate. The cost of production and the valuation of a business can greatly influence the decisions made for the businesses. I learnt from Ball & et.al (2013) that the changes in the currency values could be because of the demand and supply of the particular currencies. The other reason could be the rate of inflation in a country, the policies of a government and the interest rates at which banks operate within.
I have learnt that some industries do very little in ensuring they operate within all ethical boundaries. They fail to do this as a result of pressure to deliver profits or as a way of avoiding international crisis in handling matters that are not within their jurisdiction. They may mostly overlook cheap labor offered by children in the case of Cocoa production in West Africa, so that they reduce cost of production to a bare minimum and in turn make great profits Ball & et.al (2013).