Question

What impact does the distribution of resources have on trade?

Answer 1

The increased trade has been accompanied by a change in resource-intensive processes and associated environmental burdens for developing countries.

Trade can be resource efficient and thus allow commodities to be sourced from countries or places whose production requires less resources and has less environmental impact than others. However, numerous processes - including high levels of trade, declining minerals and declining land productivity - increase resource requirements for trade. These factors ultimately negate any benefit of potentially more efficient resource allocation and productive activities through world trade.

Appropriate trade, environmental policies and agreements are therefore necessary to limit the overexploitation, disposal and environmental destruction linked to expanded levels of trade.