Economics of International Trade

 

 

The history of international trade is a long and chequered one. The term has different connotations across history. For example in the era when the nation states were not there the term international trade meant trade over long distances.

It was pretty similar to modern day international trade, which is a kind of movement in goods. As per historical records there was an Assyrian merchant colony, which was located at Kanesh in Cappadocia during the 19th century BC. The Arabians were able to carry on trade in silk and spices in the Far East region with the help of the camels they had domesticated for the purpose. The Egyptians traded in Red Sea area. They imported spices from the Arabian region as well as the area known as “Land of Punt”.

In the middle ages the Abbasids used Siraf, Alexandria, Aden and Damietta in order to come into India and China for the purposes of trade. Chang’an, which was the capital of the Tang dynasty, was regarded as the eastern depot of the Silk Road. It became one of the significant metropolitan centers at that point of time. It was the center of trade, residence and travel. This role was taken over by Hangzhou and Kaifeng when the Song dynasty was in power. Guangzhou was one of the leading international seaports of China when the Tang dynasty was in power from 618 AD to 907 AD. However, Quanzhou became a more important seaport when the Song dynasty was in power from 960 AD to 1279 AD.

In the Early Modern ages the spice route changed to the Red Sea from the Persian Gulf in the second phase of the fifteenth century. This was a result of Levant being held by the Turks at that point of time. Pero de Covilha who was a Portuguese diplomat went on a mission to search the various trade routes in the Near East area and in Africa and Asia. He started his voyage from Santarem. He went to Barcelona, Naples, Alexandria, Cairo, and ultimately went to India.

Vasco da Gama is considered to be one of the major figures in the history of international trade in the Early Modern ages as he had invented a new sea route for trading from Europe to Japan. In the Later Modern stages the Portuguese started trading with Japan from Macao. Later on the Netherlands made Macao their base of operations for trading with Japan.

The original shipment containing nutmegs arrived at Europe from Sumatra during 1815. After the Second World War the Bretton Woods System came into play in 1946. It was meant to stop the creation of national boundaries in the domain of trade. The General Agreement on Tariffs and Trade was signed in 1947 by 23 countries in order to rationalize the system of trade across countries.