Imports and exports are something very important to the country and a lot of revenue is generated from the same no matter if it is a developed or a developing country. The value of a country’s exports and imports is one of the major indications of that country’s growing economy which is why its value is always considered important. No matter which import export courses online you follow, you will definitely learn to analyse the value of a country’s exports and imports. In this article, we will discuss some of the major factors that influence the value
- Inflation rate
It is very obvious that the low inflation rate of a country is the clear sign of its economic development. If the inflation rate is high, the country will have to import items from foreign countries while the low inflation rate will lead to export of products to other countries which will contribute to the country’s economic development.
- Exchange rate of the country’s currency
The value of the imports and exports of a country is very much influenced by the rate of currency and exchange rates. A lowered exchange rate will lower down the export prices and increase the import prices. The value of the exports in this case will be increased and the amount spent on imports will be reduced.
- Country’s productivity
When the productivity of a particular country is higher, they are able to make more products for the country and the labour costs are decreased significantly. Cheap labour costs directly affects the cost of the exports making them cheaper as well. Cheaper home made products lead to increase in domestic purchase increasing exports and minimising imports.
- Quality of products
Needless to say that the quality of the products produced in the country is the benchmark of its trade in the international as well as the local markets. Cheap quality products will not be of any use to both domestic and international markets while superior quality products will lead to more exports and minimum imports
- Marketing of products
Export of domestic products depends a lot on how well they are marketed by the manufacturers in the international market. A poorly marketed product has to suffer many times despite its superior quality while many low grade products are exported from other countries due to excellent marketing strategies from the foreign firms. So, apart from the quality and price of the product, marketing of the products play a very important role in the exports.
- Domestic standard of living
Standard of living which is also called GDP is a influencing factor when it comes to the value of imports and exports of a country. When the standard of living of the individuals of a country improves, people will buy more domestic products which will lead to domestic manufacturers manufacturing more products. More domestic manufacturing will lead to more exports and minimum imports that will increase the country’s economy to its full potential
- Standard of living of foreign countries
Just like the domestic GDP is important, the enhanced standard of living of other foreign countries is also important. If people in other countries have sufficient money and a higher standard of living, they will not only purchase domestic products but will also consider buying imported products which are not available in their domestic markets.
- Restriction free trades
For a country to have smooth import and export trades, it is extremely important that all the countries have no or limited restrictions on trades. This will motivate people to take up more import export business