THE EFFECT OF FOREIGN TRADE ON THE NIGERIAN ECONOMY
Everyday, the need for foreign trade is on the increase as the needs of man is unlimited (Adams Smith).This is visible in the rise for consumer goods and services throughout the world especially with the increase in world population of over 6 billion people. Man with his advancement in social interaction and technology is able to visualize and perceive in his mind what he desires. This was obvious with the industrial revolution where production demand increased. With the location of raw materials in different geographical zones making them ubiquitous in some areas and scarce in others, the demand for certain goods is on the increase, which gave rise to the concept of foreign trade…….. .Foreign trade exists alongside domestic trade, which has also undergone transformation from the old style of “trade by barter” to “business”. In the light of this, Nigeria as a nation participates in foreign trade.
Foreign trade as defined by Longe, (2008) is the buying and selling of goods and services beyond the geographical boundaries of a country or between one country and the other. Foreign trade also referred to as international trade, can be bilateral or multilateral and involves the use of different currencies. The Economic glossary defines foreign trade as the exchange of goods and services between countries, and as such, it goes ahead to explain that the inclination for one country to trade with another is based in large part on the idea of comparative advantage…….. Foreign trade is just an extension of production, exchange and consumption of goods and services that are fundamental part of life. The Wikipedia encyclopedia defines foreign trade (international trade) as the exchange of capital, goods and services across international borders or territories. In such countries, such trade represents a significant share of the GDP. Foreign trade comprises of imports, exports, and...
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