Introduction

International trade based on the free exchange of goods started as early as 2500 bc. Archaeological discoveries indicate that the Sumerians of Northern Mesopotamia enjoyed great prosperity based on trade by sea in textiles and metals. The more developed areas of Europe were changing from a subsistence economy to one relying heavily on imports paid by money or letters of credit. The principal motivations behind global expansion in the fifteenth century had been to enhance national economic power by exploiting the colonies for the exclusive benefit of the mother country. Colonies were regarded as outposts of the home economy that would reduce trade dependence on rival nations and augment national treasure through exports as well as discoveries of precious metals. The major characteristics of economic relations from 1900 until the outbreak of World War I were the further development of trade and the emergence of a world economy.