Business and Canadian Government Policy - International Trade Policy Term Paper

Business and Canadian Government Policy - International Trade Policy - Term Paper Example Countries that were perceived as being underprivileged or deprived had emerged as potential global powers within a very short span of time. Such a development has been possible only due to complete or partial dissolution of trade barriers binding the movements of goods and services between national boundaries. In addition, the nations no longer need to suffice their fundamental needs all by themselves, post globalisation. In fact, they can specialise in producing goods where they enjoy a comparative advantage over others; such a stance can lead to efficient allocation of resources that facilitates cost efficiency as well. Quite surprisingly South-East Asian nations, which had primarily resorted to agriculture as their forte, emerged as global powers engaging themselves in industrial production as well. Such was their evolution in the area that they soon gained a comparative advantage over many chronically known industrial economies, hence capturing a chunk of the market share. Gradually, their potentials came to the forefront and many developed nations, awed by their reserve stocks, decided to enter into pacts with them. Such a nation is Canada that recently has been considering prospects of entering into coalition with South-East Asian nations like China and India. This coalition will target primarily upon digging up new investment prospects in these developing economies. Given the availability of cheap factors of production (that leads to comparative advantage) possibilities of reaping a fat profit margin is supposed to be an almost obvious phenomenon. However, extensive research is necessary prior to taking a step ahead in the area, especially since it involves the future of a nation. Recent political developments between developing nations like India and China with Canada have reported proceedings about Free Trade Agreements between the economies. The US financial crisis has taught Canada a lesson in a hard way about not to depend much upon its