The economic globalization and the cross-border trade of commodities and services have been going on for some considerable time. But it has become considerably more attractive in the last decade. The fast technological advances, along with a shift in the way protectionism is viewed, have played an important role in the process.
Trade restrictions or regulations with foreign nations not only protect business and workers, but they also limit competition and market share. Free trade generates growth opportunities that benefit the economy. Competition is good, it heats up the market, but competitive advantage is the main objective.
Unfortunately it is harder than it sounds but, at least, not as difficult as it used to be not that long ago, when video conferencing, Internet access, and other high tech gadgets were a privilege of the first world. Nowadays, third world countries have embraced high tech solutions as their ticket to a better economy. It is a high investment that pays off when it is done properly.
But, how about cultural differences, they can be a major barrier. How can you increase your manufacturing operations in a third world country, if you might end up paying more for the cheaper labor to keep your standards and quality commitment?
