International Trade and the Environment

Running head: TRADE INVESTMENT AND ECONOMIC POLICY IN ASIA 1
International Trade and the Environment
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1TRADE INVESTMENT AND ECONOMIC POLICY IN ASIA
Purpose of the study
This research study presents the different effects of international
trade and globalization on the environment. It also explores the effects of
Trade liberalization to the environment, the use of trade Agreements in
order to protect the environment, as well as the sustainable development
Agenda.
International Trade and the environment
International trade is the exchange of services, goods, and capital across territories or
international borders. International trade is a result of globalization and the two terms can be
used interchangeably (Rasmus, 2016). International trade is useful in promoting economic
growth and trade between different countries. The current technological dynamics have made
international trade part and partial of modern economies. Technology has eased the flow of
goods and services across borders with no limits. Therefore, the gains of international trade in
today’s economies are higher than they were in the previous years. However, International
trade also has negative effects on the environment, some of these are promotion of
degradation and pollution. The environment comprises of a number of components. The most
important components are; air, water, flora, fauna, and human beings themselves. Countries
participating in international trade always affect these components of the
environment.Therefore, there is need to create trade agreements so as to protect the
environment from trade liberalization and international trade activities.
Using Sinopec Group, a Chinese gasoline and oil corporation located in china as the
case study (Sinopec, 2010), the effects of international trade and trade liberalization on the
environment are to be assessed. Additionally, the sustainable developments Agenda as well
as the existing trade agreements to protect the environment are also tackled

2TRADE INVESTMENT AND ECONOMIC POLICY IN ASIA
Impacts of International trade on the environment.
International trade is a very important aspect or factor in civilisation of countries since
it eases trade, communication, and transportation of goods and services among different
countries. Services and goods are sent where they are needed easily. Given the fact that
international trade is useful, it also has some impacts on the environment components such as
fauna and flora. Some of these negative impacts are pollution, degradation, chronic diseases
such as cancer.
The considered case Study industry is the oil industry. The case study firm is Sinopec
Group, the largest petroleum and gas industry in the world having headquarters in Beijing
China (Sinopec, 2018). Petroleum is one of the main products dealt in while carrying out
international trade. It's nicknamed "black gold" due to its ability to rise revenue for countries
where it’s used as the main export. Crude oil is very useful in the manufacturing of plastics
and medicines; fuel used by cars, planes, and other automobiles. It’s also used in heating
systems and manufacturing of gas thus making life easier.
Trade liberalization involves increased production through setting up more industries
and production centres. These cause contaminations which are very harmful to human life in
the way that they easily affect the green house. Affecting the green house may lead to low
carbon dioxide absorption from the environment and less oxygen generation to the
environment. Also, Soil and water contamination may lead to low food production
(Ehrenfeld, 2018).Given the fact that Petroleum products are essential in the daily today life;
exploring, drilling, refining, and transportation of oil products across boundaries is dangerous
to the environment (Montagnolliet al, 2015). Some of the negative impacts of international
trade through trading oil are; Oil spilling which results from the breakage of pipelines, oil

3TRADE INVESTMENT AND ECONOMIC POLICY IN ASIA
wells, trucks, and ships moving oil from one point to the other is hazardous. It is very
dangerous since it is a key factor to water and soil contamination.
Supporting International trade through using crude Oil as the trade product negatively
affects the environment, the products produced by Sinopec are highly inflammable causing
devastating fires and explosions (Tuccella et al, 2017). The nearby fauna and flora are
affected thus making liberalization dangerous to the environment. The same products when
burnt are likely to emit carbon dioxide which easily spread diseases to humans for example
cancer of the lungs through inhaling the fumes. Therefore, there is need for countermeasures
to curb the causes of these emissions.
International trade where Sinopec deals in oil products is very useful. The different
oil products are used in normal day to day life. The disadvantage comes in when there is need
to dispose the waste. Waste is hard to dispose. In Asia and Africa, waste sometimes is
disposed in streams and water passages thus causing high chances of unsafe water (acidic).
This waste is one of the cause of flooding of swamps (Tuccella et al, 2017). Therefore,
governments’ for these countries are looking forward to getting other alternatives to deal with
getting rid of this waste. One of the methods applied is burning. Fumes from automobiles run
by petroleum as well as fumes from burning plastics and refining oil contain carbon
monoxide gas which is very dangerous to the environment. These fumes are the major cause
of global warming and acidic rains in different countries.
Effects of Trade liberalization to the environment
Trade liberalization refers to the reduction or total removal of barriers or restrictions
on trade. It’s a tool for promotion of free exchange of services and goods among countries
(Lind, 2016)). Trade liberation paves way for the elimination of trade barriers across
countries. With liberation, capital flows across nations without any limitations. The adoption