The global financial crisis, the trade war between the US and China, the reorganization of the EU, increasing illegal immigration, and the coronavirus outbreak are some of the recent events that have severely impacted the global economic system. The global economy is facing a new era, and we must restructure international trade to prevent our economy from collapsing.
International trade allows countries to provide necessary products and services for their citizens at relatively lower prices but higher quality. All international trade theories revolve around the advantages of free trade. However, the adverse conditions in the global economy in the recent decade has been forcing some nations to demand more free trading benefits. Violating patents and copyrights, producing relatively cheaper products, and ignoring the standards of the developed countries have greatly benefited China while harming others. This has eventually led to unfair trade, helping only Chinese producers. Such circumstances have even reduced the volume of international trade, the global demand, and production capacities of countries correspondingly. Thus, national states are struggling to receive more benefits and are looking for ways to reduce the increasing harm from international trade.
The economic development and the social welfare level gap between the developed and developing countries have reached a peak point, and a large number of people are trying to immigrate illegally to the developed nations. Currently, there are a few million unrecorded Afghans and Africans hiding in Turkey, and people living in other Middle Eastern countries are looking for opportunities to move to the Western world. However, illegal immigration can lead to social problems in the developed countries and can influence their labor markets, labor productivity, and social structure. Consequently, through labor market structures, illegal immigration might even damage sustainability.
Although countries like India and China have become key emerging economies, this does not mean that they have well-developed economic structures and are still struggling to increase social development. These countries are using the advantage of having a cheap labor force for economic growth and development, which is not a sustainable method. Even worse, China and India might face more social issues in the future because their workers are suffering from poor working conditions. Any social structural resistance against the political powers in these countries might change their economic structures, affecting the global economy indirectly.
Due to the coronavirus pandemic, many countries seem to be developing new trade policies to protect themselves. In other words, a transition from cooperation to selfishness, and from being open economies to being closed economies, might occur. Free trade relations have already been damaged while the new health and economic conditions in the world are forcing countries to change the setting of international trade. Initial efforts to develop trading took place at the beginning of the year, but the pandemic has postponed all these attempts. To prevent further damage, we must observe the changing state of the global economy and act accordingly.
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