Question

Big Question: Should Covid-19 change global trade from a focus on low-cost and efficiency to a focus on resilience and self-sufficiency?

Answer 1

Global trade is the exchange of goods and services in international market, when one country exports one thing which it has in excess and imports other things which they can not produce or is relatively expensive. So the main reason for the global trade is the low-cost and efficiency.

So I don't think that the Covid-19 should change global trade from a focus on low-cost and efficiency to a focus on reliance and self sufficiency. The main reason for this is that this type if Pendamics are a rare and exceptional case which occurs once in hundreds of years and the whole system of global trade can't be changed for this. We should not forget the basis of international trade which we learn in different theories of international trade.

Though every country can produce almost everything which may be expensive or cheap, but this will not help the economies to grow and develop because we know everyone is different and so are the countries, they have different factor endowments and resources and hence they should help each other to get different goods than only there will be efficiency. Some countries can produce some goods cheaper than others and others can produce other goods and hence they should produce goods which are low cost and trade with each other.

So we should stick to the basic and not deviate from the path of low-cost and efficiency which is profitable for everyone. This type of situations will go in some days and than everything will be normal.