Why the Trading Nation – New Zealand
A trading nation is an unstable country in which international trade constitutes a big percentage of its gross domestic product. The currency of such a nation typically reverts and fluctuates with respect to other currencies and interest rates. This means that the value of one nation’s currency would directly proportional to the value of another nation’s currency. Trading in such nations requires a lot of knowledge and expertise. In order to gain access to the most valuable trading stocks, companies employ the most sophisticated trading strategies.
A trading nation provides enormous advantages to exporters because it provides them with access to a diverse range of products. Products that are traded internationally usually include items such as petroleum, cereals, fruits, vegetables and tobacco. Most exporters find that the best way of earning high foreign currency is by buying low-priced goods and selling them at higher prices later.
In order to be able to earn more foreign currency, exporters need to look for trading opportunities that would allow them to purchase large quantities of a low-priced good at low prices and sell them to their international customers at higher prices later. One such opportunity that provides great profit potential to exporters is the import of goods from countries with lower GDP per capita than their own. As the name indicates, a trading nation’s exportable goods are normally those whose price is significantly lower than its domestic market value. By importing these goods, exporters can reduce the cost of their international trade and realize more income from their exports.
Several large trading nations, including the United States, are considered as manufacturing nations. They take pride in the products they produce and export to the international market. Some economists have proposed that the system of free trade between the United States and other major exporting nations should be changed to favor the domestic production of the items. However, this suggestion has yet to be implemented into United States domestic policy.
A fourth reason why the trading nation New Zealand is a leading exporter of goods is because it is the largest exporter of agricultural products to the global market. New Zealand’s agricultural sector is one of the most diversified and successful industries in the world. The country’s agricultural products consist of dairy, beef, sugarcane, copper, wheat, rubber and wood pulp. In addition to the large volume of exports of these agricultural products, New Zealand’s agricultural exports also include fish, machinery, vehicles and semiconductors.
Last but not least, New Zealand is a leading manufacturer of many important global trade commodities. These include wool, steel, iron ore, coal, limestone, oil, and timber. As indicated earlier, New Zealand’s agricultural industry is highly diversified and strong. This enables New Zealand to maximize its use of its agricultural resources and consequently, its ability to export its productions internationally. The country’s abundance of forest areas enables it to grow plenty of timber and has a huge range of forest species. New Zealand is also the largest exporter of softwoods, which include pine, oak, ash, heath, Hessian and larch, and one of the largest exporters of coconut, soya lecithin, barramundi and larch tree nuts.