The trade-to-GDP ratio is an

indicator Indicator may refer to: Biology * Environmental indicator of environmental health (pressures, conditions and responses) * Ecological indicator of ecosystem health (ecological processes) * Health indicator, which is used to describe the health o ...

of the relative importance of

international trade International trade is the exchange of capital, goods, and services across international borders or territories because there is a need or want of goods or services. (See: World economy.) In most countries, such trade represents a significan ...

in the

economy An economy is an area of the Production (economics), production, Distribution (economics), distribution and trade, as well as Consumption (economics), consumption of Goods (economics), goods and Service (economics), services. In general, it is ...

of a country. It is calculated by dividing the aggregate value of

import An importer is the receiving country in an export from the sending country. Importation and exportation are the defining financial transactions of international trade. Import is part of the International Trade which involves buying and receivin ...

s and

export An export in international trade is a good produced in one country that is sold into another country or a service provided in one country for a national or resident of another country. The seller of such goods or the service provider is a ...

s over a period by the

gross domestic product Gross domestic product (GDP) is a monetary measure of the total market value of all the final goods and services produced and rendered in a specific time period by a country or countries. GDP is often used to measure the economic performanc ...

for the same period. Although called a

ratio In mathematics, a ratio () shows how many times one number contains another. For example, if there are eight oranges and six lemons in a bowl of fruit, then the ratio of oranges to lemons is eight to six (that is, 8:6, which is equivalent to the ...

, it is usually expressed as a

percentage In mathematics, a percentage () is a number or ratio expressed as a fraction (mathematics), fraction of 100. It is often Denotation, denoted using the ''percent sign'' (%), although the abbreviations ''pct.'', ''pct'', and sometimes ''pc'' are ...

. It is used as a measure of the openness of a country to international trade and so may also be called the trade openness ratio. It may be seen as an indicator of the degree of

globalisation Globalization is the process of increasing interdependence and integration among the economies, markets, societies, and cultures of different countries worldwide. This is made possible by the reduction of barriers to international trade, th ...

of an economy. Other factors aside, the trade-to-GDP ratio tends to be low in countries with large economies and large populations such as Japan and the United States and to have a higher value in small economies. Singapore has the highest trade-to-GDP ratio of any country; between 2008 and 2011 it averaged about 400%. For economies such as Armenia the trade to GDP ratio is not as high as for Singapore, but at the same time it is not as low as for the developed countries such as USA and Japan. Taking into account the last available data for Armenia, trade openness is approximately 78% for 2021. For trade-to-GDP ratio, the provided data for Armenia is from 1990 to 2021. The average value for Armenia during that period was 77.92% with a minimum of 54.54% in 2008 and a maximum of 112.43% in 1994. For comparison, the world average in 2021 based on 129 countries is 90.86%. See the global rankings for that indicator or use the country comparator to compare trends over time. Worldwide trade-to-GDP ratio rose from just over 20% in 1995 to about 30% in 2014.

References

Macroeconomic indicators {{Macroeconomics-stub

See also

References