Globalization has been an important topic in the current international trade. It is defined as the extent and intensity of interaction between two or more countries. The interaction between countries is done through capital flows, trade and production (Nassif & Castilho, 2018). Even though the internationalization happened before industrial revolution, it has gained popularity in the modern business. In case of Germany, trade between countries have been encouraged by government policies. Germany trade integration with other countries has been an important topic of study.
Global poverty levels have declined over the time in the country. North America is home to less than the 5% of the world population. It accounts for about 27% of the world’s GDP, 24% of the world population and 4% of the international GDP. With Germany being one of the biggest economy in the world, international trade has been through major countries. On the surface, Germany and United States has been major trade partners. According to Bastos, et al., (2019), trade between United States and Germany have heard close relationship in exports of raw materials that do not exist in either of the country. More specifically, Germany has specialized in production of high-end technological and knowledge based goods that find and expanding consumer base with the United States lian middle class. United States is has been the best destinations for middle class business. The country faces deficits in terms of infrastructure while Germany is most developed. Germany provide investment opportunities in the sector in United States.
Sustaining Competitive Advantage of Germany’s Exports
With the competitive global economy, Germany has been working towards having a competitive advantage. The dynamic nature of foreign trade between countries has forced it to be the leading economy of its region. In the recent years, the manufacturing exporters in Germany have continued to gain competitive advantage to the new markets. Through various policies, the company has managed to develop products and services that has helped the country to have a competitive price, comparative advantage and innovations. The good performance in Germany’s manufacturing sector has helped the country to achieve a relative high rate of labor productivity growth of 1.1% annually. As shown in figure 3, Germany has managed to have an export-oriented economy. On the other hand, the service sector has declined with the rate of productivity bellow the European economies.