The international trade industry stands as the foundation of the global economy, facilitating the exchange of goods, services, and capital across borders. With advancements in technology and globalization, the landscape of international trade has undergone profound transformations.
International Trade: Key Trends
The global international trade industry has experienced consistent growth, with the total value of world merchandise trade reaching $19.48 trillion in 2020, as reported by the World Trade Organization (WTO). Emerging markets and developing economies have been driving significant trade growth. According to the WTO, the share of developing economies in global merchandise trade increased from 39% in 2000 to 47% in 2019. Regional trade agreements have played a pivotal role in fostering trade growth. For example, intra-EU trade accounted for 67% of the EU's total trade in goods in 2020, highlighting the importance of regional integration in boosting trade volumes.
The Port of Shanghai, the world's busiest container port, handled over 43 million TEUs (twenty-foot equivalent units) of cargo in 2020, highlighting the importance of major ports in facilitating global trade flows. Moreover, investments in infrastructure projects such as the Belt and Road Initiative (BRI) have led to significant improvements in trade connectivity between Asia, Europe, and Africa. As of 2020, China has invested over $210 billion in BRI-related projects and trade facilitation reforms have yielded tangible results. For example, countries implementing the WTO's Trade Facilitation Agreement (TFA) have experienced a 4.7% reduction in trade costs on average.
Additionally, regional trade agreements have proliferated in recent years, with over 300 regional trade agreements in force worldwide. The African Continental Free Trade Area (AfCFTA), launched in January 2021, aims to create the world's largest single market, covering 1.3 billion people with a combined GDP of $3.4 trillion. Despite the challenges facing multilateral trade negotiations, the WTO remains central to the global trading system, with 164 member countries accounting for 98% of world trade.
Not only that, but sustainable trade practices are also gaining prominence. For example, the market for sustainable packaging is projected to reach $393.93 billion by 2028, growing at a compound annual growth rate (CAGR) of 8.8% from 2021 to 2028. Inclusive trade policies are critical for small & mid-sized enterprises (SMEs). SMEs account for over 90% of businesses worldwide and contribute up to 60% of total employment and these have led to women's participation in trade is essential for inclusive growth. Closing the gender gap in trade could add up to $28 trillion to global GDP by 2025.
Some companies have been prominent in adding to their respective country’s trade balances. For example, Amazon.com, Inc. (NASDAQ:AMZN), the world's largest online retailer, has transformed the way consumers shop and businesses sell goods globally. Amazon.com, Inc. (NASDAQ:AMZN)’s cross-border trade services facilitate international sales for small and medium-sized businesses, helping them expand their reach and access new markets. In 2020, Amazon.com, Inc. (NASDAQ:AMZN)’s net sales reached $386.1 billion, with a significant portion attributed to international sales. Although the exact percentage of international sales contributing to total revenue is not specified, Amazon.com, Inc. (NASDAQ:AMZN)’s global presence and extensive cross-border e-commerce operations undoubtedly contribute to the country's trade balance.
Similarly, C. H. Robinson Worldwide Inc. (CHRW), a third-party logistics (3PL) company, offers freight transportation, logistics, and supply chain services globally. The company's expertise in freight forwarding, customs brokerage, and supply chain optimization helps businesses navigate the complexities of international trade and streamline their logistics operations. C. H. Robinson Worldwide Inc. (CHRW)’s services contribute to the efficient movement of goods across borders, supporting the growth of global trade.Its annual revenue for 2020 was $21.93 billion, with a significant portion derived from its transportation and logistics services, including international freight forwarding.
15 Most Advanced Countries in International Trade
Methodology
To compile the list of the 15 Most Advanced Countries in International Trade we have considered rankings of the countries with highest trade surplus and rankings of countries with highest share of global exports from sources like: United Nations Conference of Trade & Development and United States Census Bureau. Rankings from each source were assigned a weighted score and then we calculated the average rankings of these countries to calculate our own scores for each country to determine the most advanced countries in international trade, ranking from least advanced countries to most advanced. The list is presented in ascending order of scores, with lower scores corresponding to lower levels of advancement in international trade.
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15 Most Advanced Countries in International Trade
15. Netherlands
Score: 3
The Netherlands is a pivotal player in international trade, owing to its strategic location, world-class infrastructure, and highly developed logistics sector. It serves as a key entry point for goods entering and exiting the continent. Its ports, including the Port of Rotterdam, are among the busiest in the world, facilitating the efficient movement of goods between Europe and other regions. Additionally, the Netherlands boasts a sophisticated transportation network, including an extensive network of railways and highways, further enhancing its connectivity to global markets. The country's export-oriented economy is diversified, with exports ranging from machinery, chemicals, and electronics to agricultural products and high-value-added services. Moreover, the Netherlands' commitment to innovation, coupled with a favorable business climate, fosters entrepreneurship and attracts foreign investment, bolstering its position as a leading hub for international trade.
14. Hong Kong
Score: 3.5
Hong Kong has long been recognized as a global financial and trade hub, characterized by its strategic location, business-friendly environment, and robust infrastructure. Serving as a gateway to the vast Chinese market and the broader Asia-Pacific region, Hong Kong plays a pivotal role in facilitating international trade and investment flows. The city's world-class port facilities, efficient logistics networks, and well-established legal framework contribute to its status as one of the world's busiest trading hubs. Moreover, Hong Kong's free-market policies, low taxation, and transparent regulatory regime attract multinational corporations and traders from around the globe. The city's dynamic trading community, coupled with its strategic partnerships and participation in regional trade agreements, further enhances its competitiveness in international trade. Despite challenges such as geopolitical uncertainties and socio-political developments, Hong Kong's resilience and adaptability continue to reinforce its significance as a major player in global commerce.
13. Belgium
Score: 8.5
Belgium’s ports, including the Port of Antwerp, are among the busiest in Europe, facilitating the seamless flow of goods between Europe, Africa, and beyond. Belgium's advanced transportation networks, including extensive rail and road connections, further enhance its connectivity to global markets. Its export-oriented economy is diversified, with key sectors including chemicals, machinery, automobiles, and processed foods. Moreover, Belgium's commitment to open trade policies and its membership in the European Union reinforce its role as a hub for international commerce. Despite its relatively small size, Belgium's strategic advantages, coupled with its competitive business environment and skilled workforce, contribute to its prominence in international trade.
12. France
Score: 9
France stands as a major player in international trade, driven by its advanced industrial base, renowned brands, and strategic location within the European Union. The country's export portfolio encompasses a wide range of products, including aerospace, automotive, luxury goods, and agricultural produce. France benefits from an extensive transportation infrastructure, including modern ports, railways, and highways, facilitating efficient trade flows both domestically and internationally. Moreover, France's commitment to innovation and research excellence, coupled with government support for key industries, enhances its competitiveness in global markets. The country's active participation in international trade agreements and organizations, alongside its diplomatic initiatives, further reinforces its position as a leading advocate for free and fair trade.
11. Singapore
Score: 10
Singapore has emerged as a global hub for international trade and commerce, propelled by its strategic location, world-class infrastructure, and pro-business environment. Situated at the crossroads of major shipping routes in the Asia-Pacific region, Singapore serves as a crucial maritime gateway, with one of the busiest ports in the world. Its advanced logistics facilities, including state-of-the-art container terminals and efficient customs procedures, ensure smooth trade flows and connectivity to global markets. Moreover, Singapore's status as a financial center attracts multinational corporations and traders seeking investment opportunities and financial services. The country's commitment to trade liberalization is evident through its participation in numerous free trade agreements, including the Comprehensive and Progressive Agreement for Trans-Pacific Partnership (CPTPP) and the Regional Comprehensive Economic Partnership (RCEP). Furthermore, Singapore's reputation for political stability, transparency, and adherence to the rule of law enhances its appeal as a preferred destination for international trade and investment.
10. United Arab Emirates
Score: 11
The United Arab Emirates (UAE) has emerged as a key player in international trade, leveraging its strategic location, modern infrastructure, and diversified economy. Situated at the crossroads of major global trade routes, particularly between East and West, the UAE serves as a vital hub for trade and logistics. Its world-class ports, including Jebel Ali in Dubai, facilitate efficient movement of goods, while state-of-the-art airports like Dubai International Airport connect the UAE to markets around the globe. The country's economy, once heavily reliant on oil exports, has diversified significantly, with trade now encompassing sectors such as tourism, finance, and manufacturing. Furthermore, the UAE's business-friendly policies, free trade zones, and investment incentives attract multinational companies, fostering a dynamic trade ecosystem. With a strategic vision focused on enhancing connectivity and fostering economic diversification, the UAE continues to solidify its position as a key player in international trade.
9. United Kingdom
Score: 12
The United Kingdom (UK) boasts a rich history of international trade and remains a significant player in the global marketplace. Despite its relatively small geographical size, the UK's economy is highly diversified, with exports ranging from financial services and pharmaceuticals to automotive and aerospace products. As a member of the European Union (prior to Brexit), the UK benefited from access to the world's largest single market, facilitating seamless trade with neighboring countries. Post-Brexit, the UK has been actively negotiating trade agreements with various nations and blocs to maintain and expand its trading relationships. London, as a global financial center, plays a crucial role in facilitating international trade transactions and investments. Additionally, the UK's commitment to innovation and technological advancement fosters its competitiveness in global markets. Despite uncertainties surrounding Brexit and its aftermath, the UK's historical legacy and economic resilience continue to underpin its significance in international trade.
8. Australia
Score: 13.5
Australia has emerged as a formidable force in international trade, buoyed by its abundance of natural resources, stable economy, and strategic positioning in the Asia-Pacific region. The country's export portfolio encompasses commodities such as minerals, agricultural products, and energy resources, which cater to the growing demand from emerging markets, particularly in Asia. Australia's modern infrastructure, efficient transportation networks, and advanced logistics systems facilitate the smooth flow of goods both domestically and internationally. Moreover, the nation's commitment to trade liberalization is evidenced by its participation in regional trade agreements like the Comprehensive and Progressive Agreement for Trans-Pacific Partnership (CPTPP) and bilateral free trade agreements with key partners. Additionally, Australia's strong emphasis on innovation and technology-driven industries enhances its competitiveness in global markets.
7. South Korea
Score: 14.5
South Korea is a global powerhouse in international trade, propelled by its technological innovation, strong manufacturing base, and strategic trade policies. The country's export-driven economy is characterized by leading industries such as electronics, automobiles, shipbuilding, and petrochemicals. Renowned brands like Samsung, Hyundai, and LG have become synonymous with quality and innovation worldwide, driving South Korea's export success. The nation's advanced infrastructure, including modern ports and transportation networks, facilitates efficient trade flows and connectivity with global markets. South Korea's proactive engagement in free trade agreements, including the Korea-U.S. Free Trade Agreement (KORUS FTA) and the Regional Comprehensive Economic Partnership (RCEP), expands its access to key markets and enhances its competitiveness. Moreover, the government's focus on research and development, coupled with robust intellectual property protection, sustains South Korea's position as a leader in technology-intensive sectors. Despite geopolitical tensions and external challenges, South Korea's dynamism and resilience in international trade continue to propel its economic growth and global influence.
6. Taiwan
Score: 15
Taiwan has established itself as a major player in international trade, leveraging its advanced technology, manufacturing prowess, and strategic location in the Asia-Pacific region. The country's export-oriented economy is anchored by industries such as semiconductors, electronics, machinery, and petrochemicals. Leading global technology firms like TSMC and Foxconn have their roots in Taiwan, contributing significantly to the country's export success and technological innovation. Taiwan's robust infrastructure, including world-class ports and transportation networks, facilitates efficient trade flows and connectivity with key markets worldwide. Furthermore, Taiwan's proactive trade policies, including participation in trade agreements like the World Trade Organization (WTO) and the signing of bilateral free trade agreements, enhance its access to global markets. Despite geopolitical complexities and challenges related to cross-strait relations, Taiwan's resilience, entrepreneurial spirit, and focus on innovation continue to drive its prominence in international trade.
