This document discusses various economic systems and international trade. It defines capitalism, socialism, and communism, and provides examples of countries that follow each system. It also outlines the benefits and drawbacks of capitalism and socialism. Additionally, the document discusses characteristics and classifications of international trade, including import, export, and entreport trade. It provides practical examples of trade between countries like the US and Pakistan, and China and Pakistan. Finally, it notes some common problems in international trade such as language barriers, distance, transportation costs, and government restrictions.

1. Topic:
Economical Societies and International Trades

2. Group 2:
Ahmad Sunnan(Leader)
Maham Rafhan
Amish Akbar
Haseeb Ur Rehman

3. Capitalism

4. Definition:
 Capitalism is an ideology where the means of production is controlled by private
business. This means that individual citizens run the economy without the
government interfering in production or pricing. Instead, pricing is set by the free
market. This means that value is based on supply and demand and the
relationship between producers and consumers.

5. Ranked Countries:
Rank Country Economic Freedom Score
1 Hong Kong 8.94
2 Singapore 8.65
3 New Zealand 8.53
4 Switzerland 8.43
5 Australia 8.23
6 United States 8.22
7 Mauritius 8.21
8 Georgia 8.18
9 Canada 8.17
10 Ireland 8.13

6. Benefits and Drawbacks
Benefits
Efficient Allocation of Resources.
Efficient Production. ...
Dynamic Efficiency.
Financial Incentives.
Economic freedom to political freedom
Drawbacks
 Social benefit ignored. ...
 Inherited wealth and wealth
inequality. ...
 Inequality creates social division.
 Diminishing marginal utility of wealth.

7. Socialism

8. Definition:
 Both an economic system and a political way of thinking
 A nation’s wealth should be distributed to everyone in a fair way.
 Ownership of most of the means of production is public rather than private. The
government, not the individual is the center of the economy
 Based on the idea of cooperation and social responsibility.

9. History
 Came about after the Industrial Revolution
 The Rich got richer and the poor
 Great suffering by the workers

10. Socialists Countries
 Sweden
 Finland
 France
 Venezuela
 Northern Europe
 Some south American Countries

11. Socialism Strengths
 Full employment
 End of poverty
 Workers enjoy full “fruit of labor”
 Production is geared toward use not profit
 Evens out differences
- makes people more equal

12. Socialism Weaknesses
 Robs human incentive
 Too much government control
 Complicates government (bureaucracy)
 High taxation and redistribution of wealth
 Individual freedom is secondary to state needs

13. Communism

14. Communism
 “From each according to his ability, To each according to his needs”
 A government where people shared work fairly and were paid equally.
 The word “Communism” comes from the Latin word “Communist” which means
common or belonging to all.

15. Origin of Communism
 Original idea was proposed in Ancient Greece
 In modern times it was proposed by Karl Marx and his good friend Frederick
Engels.
– They studied the history of world economies and how power, industry & finances
were controlled
 Marx and Engels wrote the “Communist Manifesto” in 1847.

16. The Beliefs of Communism
 There is always a struggle between classes
–Factory owners got rich on the backs of the workers.
 The workers take control of the country to produce things for everyone.
 Nothing is made for profit, all people benefit.

17. The Goal of Communism
 To get rid of social classes and make everything fair for everyone

18. The Symbols of Communism
 The Symbols of Communism
 The Hammer & Sickle
– The Hammer represents workers
– The Sickle represents farm laborers

19. Communism in Asia
 Today, there are a number of communist countries throughout Asia.
 They include:
– China
– North Korea
– Vietnam

20. International Trade

21. International Trade
 International trade is referred to as the exchange or trade of goods and services
between different nations. This kind of trade contributes and increases the world
economy. The most commonly traded commodities are television sets, clothes,
machinery, capital goods, food, and raw material, etc.,
 According to Wasserman and Haltman, “International trade consists of transaction
between residents of different countries”.
 According to Anatol Marad, “International trade is a trade between nations”.

22. Classification of International Trade
(a) Import Trade:
 It refers to purchase of goods from a foreign country. Countries import goods which are
not produced by them either because of cost disadvantage or because of physical
difficulties or even those goods which are not produced in sufficient quantities so as to
meet their requirements.
(b) Export Trade:
 It means the sale of goods to a foreign country. In this trade the goods are sent outside
the country.
(c) Entreport Trade:
 When goods are imported from one country and are exported to another country, it is
called Entreport trade. Here, the goods are imported not for consumption or sale in the
country but for re- exporting to a third country. So importing of foreign goods for export
purposes is known as Entreport trade.

23. Characteristics of International Trade:
 Foreign Currency:
 Foreign trade involves payments in foreign currency. Different foreign currencies are
 involved while trading with other countries.
 Restrictions:
 Imports and exports involve a number of restrictions but by different countries.
Normally, imports face many import duties and restrictions imposed by importing
country. Similarly, various rules and regulations are to be followed while sending
goods outside the country.
 Governmental Control:
 In every country, government controls the foreign trade. It gives permission for
imports and exports may influence the decision about the countries with which trade
is to take place.

24. Practical example
 Trade relation between US and Pakistan
Bilateral trade between Pakistan and the U.S. reached an all-time high in 2018, with two-
way trade worth $6.8 billion. Pakistan's exports to the U.S. were $3.8 billion whereas
imports amounted to $2.9 billion.
 Trade relation between China and Pakistan
In 2019, Pakistan also signed an agreement with China to use Chinese currency for bilateral
trade to get rid of the dollar burden in $15 billion bilateral trade. According to official data,
Pakistan and China's bilateral trade volume grew to some $15.6 billion in the 2019 fiscal
year, up from $2.2 billion in 2005.

25. Problems in International Trade
 Language barriers
 Distance barriers
 Transport cost
 Insurance burden
 Government restrictions
 Taxation burden
 Market research
 Uncertainty

26. Thanks