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Internationalization process: What is it?

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The internationalization process consists of the internationalization of production. This process increases economics ties between national economies making a country being part of the global production process on the basis of the international division of labour, production and scientific-technical specialization and cooperation. The internationalization of production in the era of developed industrial capitalism has an especially intense nature under the influence of scientific and technical revolution. In the early stages, this process developed almost exclusively as inter-sectoral international specialization.

Currently, the internationalization process is developing faster and further than even before. If you want your company to get into the international market and you do not count on staff specialized in international trade, you can count on Salcix, where the international trade specialist work

How the internationalization process has been developed in the past?

Historically, the further deepening of the internationalization of production is associated with the emergence of various forms of intra-industry specialization: subject (eg, the specialization of large firms in the USA, Great Britain, Germany, Japan in the production of certain types of equipment) and the international specialization of individual industries; in the manufacture of products of certain sizes (for example, the tractor industry in the USA specializes in the production of the most powerful wheeled and tracked tractors, Great Britain in the production of wheeled tractors of medium size, Germany – of low power); exploded specialization of factories of individual countries in the production of components, components or parts; technological specialization of enterprises of different countries in the performance of certain types of work. The internationalization of production also appears in the form of the internationalization of scientific and technical research: companies from different countries are united to carry out various scientific and design works; there is a specialization of individual countries in certain types of scientific research. The internationalization of production under capitalism is the basis for the internationalization of capital. The development of the internationalization of production is also manifested in the formation of international economic organizations both in the sphere of production, transport, communications and in the sphere of international trade and finance.

Main features

In other words, Internationalization of production is the process of establishing relationships between enterprises of foreign and national economies. Relations between manufacturers are carried out in several directions: First, an increase in the social character is possible due to the improvement of production units. In the process of improving the productive forces, private enterprises lose to cooperatives that are constantly growing. And with the increase in international cooperation, the number of people working in them increases. Secondly, the strengthening of the social nature of labour becomes possible because of the impact of the division of labour, which contributes to the establishment of interconnections between enterprises, ensures joint labour activity and unites separated producers into a single whole. The internationalization of production goes through two stages: formal; real. Formal internationalization is the cooperation of international enterprises, in which countries work for each other, but the costs of manufacturing the same goods can vary greatly. Such a situation becomes possible due to the establishment of barriers to the free exchange of goods between the borders of states. That is, the formal internationalization is characterized by the presence of economic ties with the presence of customs and other barriers.

In order to take advantage of the benefits of this unstoppable process so that your company can grow even further, you should contact us. Let’s us talk

Internationalization of capital

In a real internationalization, countries unite to get the maximum effect for all participants in the process. Of course, each country can develop independently, but the effect of it may be insignificant. And with international cooperation, each country can increase production efficiency to an average level.

The internationalization of capital occurs by combining national and foreign capital. By its forms of capital is private, collective, state. In turn, each form can appear in the form of industrial, banking and other types of capital. Thus, the internationalization of capital is considered as the interaction of the main forms of capital of various types of capital of one or several states. For example, the interaction of private banking capitals of two countries or state-owned industrial and private banking capitals of two or more countries.

Features of this process can be traced in the interaction of socio-economic, market relations that arise in the process of capital accumulation for its effective use. The internationalization of capital allows the economic growth of the state. The material basis for the internationalization of capital is the internationalization of production, production forces and the division of labour. One of the most important roles in the internationalization of capital is played by international monopolies. This happens due to the creation of subsidiaries and branches, which in turn leads to the creation of transnational corporations. Within the limits of a transnational corporation, its structural divisions are interconnected by joint scientific research, a high level of commodity turnover between them, and operational specialization. One of the important parts of the internationalization of capital is the interaction of capital of transnational corporations and international banks. This allows you to create transnational financial capital.

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