Exportation Of Low-Cost Raw Materials - PART 3 ISOEconomics / Isokratic Econommics
Exportation of low-cost raw materials to the super-buying powers, or vast economies, can only last until their need for such raw materials is met. Demand would peak, and then it would be slashed overnight. The results would be catastrophic for the exporting economies. A classic case here is the steel industry of Japan. Over 30 years through special agreements, the majority of Japanese steel was imported by the USA. America had bought that steel at super-low prices, which gave Japan the false impression and belief that this demand would be forever. As soon as the USA had filled its infrastructure with the cheap imported Japanese steel, demand almost ceased to exist overnight. Demand by Japan’s major customer was diminished overnight.
In addition to the diminished demand from the USA, the Japanese steel industry received a second blow. The USA imposed import duties on Japanese steel, to protect their home product. Japan now through the bitter pill, is learning and is fast trying to spread it’s customers around the globe, no longer to rely heavily on one, or a handful of national economies for the export of Japanese products and services. This will bring many economic benefits to other economies around the globe. Will Japan make the same mistake again? Or will Japan move towards the global Iso economics model.