INTERDEPENDENCE OF INTERNATIONAL TRADE AND INVESTMENT FLOWS IN THE POST-CRISIS PERIOD

• Published in: Ekonomika (Niš, Serbia) Serbia), 2016, Vol.62 (2), p.49-59
• Main Author: Stojadinović Jovanović, Sandra
• Format: Article
• Language: English
• Subjects: Economy; Supranational / Global Economy
• ISSN: 0350-137X; 2334-9190
• DOI: 10.5937/ekonomika1602049S

The world economy was characterized by the continuous increase of international trade and international investments flows in the second half of the twentieth century and by intertwining of these flows especially in the period after 1990s. The aim of the paper is to show that there are mutual relationship, interconnection and intertwining of international trade flows and investment flows in the post-crisis period as well as in the period before the 2008 crisis. The post-crisis period has brought the recovery of both international trade flows and international investment flows and their higher levels. These developments haven’t changed the fact that, the same as in the period before the crisis, international trade flows continue to perform increasingly more through investments flows, that is through foreign affiliates’ sales, then through classic, cross-border trade. The sales through foreign affiliates remain the main channel of international trading. In this situation, only the approach that means the new coverage implementation of international trade flows will lead us to the real international trade values and international trade picture. If we look for the impetus and drivers of the economic growth in trade and investments flows, then we must take into account the connection and intertwining of these two types of flows in order to have a real picture of them and make adequate decisions in the field of investment, trade and economic policy.