INTERNATIONAL TRADE

Countries like the UKIMPORT and EXPORT many goods and services around the world.

When the UKimports products this means that the UK buys goods from another country.

When the UKexports products this means that goods made in the UK are sold to other countries in the world.

The UKimports goods because:

  • There are products that would be difficult to produce at home because of the climate, for example fruit.
  • Other countries are better (more efficient) at making the product, for example, motor cars.
  • There are certain products that we simply do not have, such as diamonds.

The UKexports goods because:

  • The UK has some resources that other countries do not have, for example, fresh quality water.
  • The sale of exports is necessary to raise money to pay for imports.
  • For reasons such as the climate, the UK can produce more than it needs for its own citizens, so it makes sense to sell some abroad.

As a result of international trade, countries are able to specialise on what they are good at producing. They are then able to keep what they need for themselves and sell the rest to other countries around the world. This will raise money for these countries to help them purchase goods from other countries that they cannot produce themselves.

TASK 1

The table below outlines a range of products that are produced by different countries. You should match up the country with the product that they specialise in making. The first one has been done for you.

PRODUCT / COUNTRY
Tea / Norway
Coffee / New Zealand
Whisky / Japan
Chocolate / Scotland
Oranges / Russia
Coca Cola / Switzerland
Wine / Africa
Pasta / India
Bacon / India
Rice / Holland
Sugar / Italy
Bananas / France
Clocks / America
Vodka / Spain
Electronics / Belgium
Tartan / Scotland
Lamb / India
Timber / Scotland

TASK 2

Below are the top ten countries that the UK EXPORTED goods to during 2010.

  • Create a spreadsheet
  • Enter the data below

Order / Country / Value of Exports (£m)
1 / United States / £33,531
2 / Germany / £24,760
3 / France / £17,871
4 / Netherlands / £17,379
5 / IrishRepublic / £15,295
6 / Belgium / £10,456
7 / Spain / £8,949
8 / Italy / £8,196
9 / China / £5,129
10 / Sweden / £4,106
  • Create a column chart using the chart wizard
  • The chart should have the following title:

UK TOP TEN EXPORTS DURING 2010

  • Label the X axis:

Country

  • Label the Y axis

Value of Goods Exported

  • Put your name in the footer.
  • Save the spreadsheet as UK Exports
  • Print one copy of your chart

TASK 3

Below are the top ten countries that the UK IMPORTED goods from during 2010.

  • Create a spreadsheet
  • Enter the data below

Order / Country / Value of Exports (£m)
1 / Germany / £39,131
2 / United States / £28,451
3 / China / £22,840
4 / Netherlands / £21,201
5 / France / £20,226
6 / Norway / £15,085
7 / Belgium / £14,771
8 / IrishRepublic / £12,218
9 / Italy / £11,983
10 / Spain / £9,088
  • Create a column chart using the chart wizard
  • The chart should have the following title:

UK TOP TEN IMPORTS DURING 2010

  • Label the X axis:

Country

  • Label the Y axis

Value of Goods Imported

  • Put your name in the footer.
  • Save the spreadsheet as UK Exports
  • Print one copy of your chart

When the UKexports more goods than it imports it is said to have made a SURPLUS on trade.

When the UKimports more goods that it exports it is said to have made a DEFICIT on trade.

TASK 4

For each of the following year, calculate whether the UK has made a surplus or a deficit on world trade.

2007

UK EXPORTS / UK IMPORTS / SURPLUS/DEFICIT
£(m) / £(m) / £(m)
£175,245 / £200,589

2008

UK EXPORTS / UK IMPORTS / SURPLUS/DEFICIT
£(m) / £(m) / £(m)
£182,325 / £220,410

2009

UK EXPORTS / UK IMPORTS / SURPLUS/DEFICIT
£(m) / £(m) / £(m)
£192,610 / £265,560

2010

UK EXPORTS / UK IMPORTS / SURPLUS/DEFICIT
£(m) / £(m) / £(m)
£205,213 / £255,572

EXCHANGE RATES

When the United Kingdom wishes to purchase goods from another country, it has to pay for these goods in the currency of that country. For example, if the United Kingdom wishes to purchase goods from the USA it must pay for these in US dollars ($).

The United Kingdom must exchange pounds sterling (£) for USA dollars ($).

TASK 5

Use the Internet to research the currency used by the countries shown in the table below.

COUNTRY / CURRENCY
China
Spain
Japan
Bulgaria
Norway /
Germany
Sweden
Russia
Italy
Canada

TASK 6

Look at the exchange rates shown below.

£1 = / 1.62 United States Dollars
£1 = / 1.15 Euros
£1 = / 1.33 Japanese Yen
£1 = / 1.58 Canadian Dollars

Use the currency converter above to answer the following questions in your jotter:

  1. Mr Jones visits the USA and purchases a new jacket for $156 USA dollars. How much would this be in UK £ sterling?
  1. Mrs McCallum will be visiting Japan on a business trip. She is planning on taking £800. How many Japanese Yen will this provide her with?
  1. The Bradley family will be going to Spain on a summer holiday. They are planning on taking £1,000 spending money. How many Euros will they have to spend on holiday?
  1. While on holiday the Bradley family intend to dine out for their evening meal. They estimate that this will cost approximately 60 Euros per night. What is the meal costing them in UK pounds sterling?

THE ADVANTAGES OF INTERNATIONAL TRADE TO THE UK

UK citizens have a wider choice of goods and services in shops and supermarkets.

When UK businesses are able to sell their products abroad in countries like France and Germany, they are able to grow and create jobs for UK citizens.

International trade helps to keep prices in shops low for consumers. When businesses are competing with businesses from all over the world they have to be really efficient and make sure prices are low to encourage consumers to buy from them.

TASK 7

WORD SEARCH

Find the following words in the word search below:

IMPORTSTRADEDOLLAR

EUROYENEXPORT

SPECIALISECURRENCYDEFICIT

EXCHANGE RATEBALANCE OF PAYMENTS

I / V / N / M / C / X / H / J / S / S / D / F / B / D / C / K / S
M / T / F / F / H / D / Y / E / R / U / E / X / P / 0 / R / T / P
P / S / R / D / S / F / D / H / B / R / B / M / J / L / G / D / E
O / D / F / A / D / H / F / D / G / P / K / H / F / L / G / J / C
R / W / E / W / D / D / E / D / S / L / D / F / D / A / F / F / I
T / D / F / D / G / E / U / R / O / U / D / D / S / R / D / S / A
S / I / Y / D / D / F / F / D / F / S / D / F / Y / E / N / H / L
F / Y / H / G / Y / I / E / D / F / G / G / E / D / W / W / E / I
F / H / H / J / H / C / U / R / R / E / N / C / Y / Q / D / D / S
G / J / J / L / H / I / J / U / C / G / V / W / D / E / S / D / E
P / T / G / H / H / T / J / C / V / N / V / E / D / D / D / S / F
E / X / C / H / A / N / G / E / R / A / T / E / D / G / E / P / F
B / A / L / A / N / C / E / O / F / P / A / Y / M / E / N / T / S

TASK 8

Answer the following questions in sentences on the paper provided.

1State one reason why the UK imports goods from other countries?

2State one reason why the UK exports goods to other countries?

3Select any 5 countries in the world and state what products they tend to export to the rest of the world.

4Name the 3 countries which the United Kingdom exports most goods to.

5Name the 3 countries which the United Kingdom imports most goods from.

6When would a country make a surplus on trade?

7When would a country make a deficit on trade?

8What currencies do the following countries use?

USA

Italy

Japan

Spain

9State one advantage of international trade for UK consumers?

10If the exchange rate is $1.55 USA dollars to £1 UK sterling how many USA dollars would you receive in exchange for £200?

TASK 9

Unscramble the following words:

USPSLRU______

EDTRA______

YCNERUCR______

TIICFED______

EATR EGANHCXE______

LLODRA______

NEY______

TORPIM______

XORTEP______

OURE______

TASK 10

INTERNET RESEARCH TASK

Select one of the countries shown below:

  • Japan
  • USA
  • China
  • Germany

Use the internet to research your chosen country. You should identify the following:

What are the key industries of the country?

What are the main exports of the country?

Does the country have well-known companies with brands known world wide?

Present your findings in a Powerpoint presentation.

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