International trade takes place within the framework of agreements worked out by countries in the World Trade Organization (WTO), formerly known as the General Agreement on Tariffs and Trade (GATT).

Module 1 (Unit 9) Text 2

Trade

International trade takes place within the framework of agreements worked out by countries in the World Trade Organization (WTO), formerly known as the General Agreement on Tariffs and Trade (GATT). Over the last 50 years trade barriers have been coming down and free trade,open borders and deregulation now form the ideal for almost all nations, even if the situation is far from one of complete laissez-faire, with no government intervention.Protectionism is no longer the order of the day in most places; even if some developing countries argue that protectionist measures are the way to develop their economies, they avoid using the term.

Trade negotiations are well-known for their epic eleventh-hour negotiating sessions, where individual nations argue for what they see as their specific interests and horse-trade furiously. Countries argue for protection of their strategic industries, ones they consider vital to future prosperity such as the electronics industry in the developed world. A less developed country beginning car assembly might want to protect it as an infant industry with quotas,restrictions on numbers of imported cars. European farmers argue for their subsidies, where governments guarantee farmers a higher price than they would normally get, making it hard for developing nations to compete in markets for agricultural products.

Countries sometimes accuse each other of dumping, where exported goods are sold at less than in the home market or for less than they cost to produce, usually in order to gain market share in the export market. The offending country may reply that it has a comparative advantage in producing these goods, the ability to produce them cheaper than anyone else, and that they are not selling at below cost.

Of course, there are trading blocs with no trade barriers at all such as the single market of the European Union. The North American Free Trade Organization, or NAFTA, (the US, Canada and Mexico) is also eliminating its tariff walls and customs duties. Their equivalents in Asia and Latin America are ASEAN and Mercosur. All this is part of the wider picture of globalization, the tendency of the world economy to function as one unit.

One major concern in international trade between smaller companies is payment. The exporter wants to be sure about getting paid and the importer wants to be sure of getting the goods. A common solution is the letter of credit, where a bank guarantees payment to the exporter's bank once it receives the related shipping documents, including the clean bills of lading, showing the goods have been shipped without damage or other problems. Shipping terms like CIF, or Carriage insurance freight, where the exporter pays for insurance of goods while they are being transported, are part of the standard Inco terms defined by the International Chamber of Commerce. These terms are used in standard contracts that form the basis, with adaptations, for most international trade contracts.

Find equivalents to the underlined words:

Международная торговая палата (МТП); торговые переговоры; вмешательство; демпинг; СИФ, стоимость, страхование и фрахт (одно из базовых условий экспортных контрактов, по которому продавец оплачивает расходы на перевозку товаров до порта назначения и страхует их до перехода права собственности грузополучателю); торговые барьеры; стратегически важные индустрии; молодая\неокрепшая отрасль; невмешательство (правительства в дела частных лиц, в бизнес и торговлю); аккредитив; свободная торговля; сравнительное преимущество; уничтожение; защита; прекращение регулирования; квоты; протекционизм; торговые барьеры; доля рынка; открытые границы; глобализация; субсидии; стандартное соглашение; погрузочные документы; торговый блок; чистый коносамент (коносамент, удостоверяющий хорошее состояние груза); таможенные пошлины; условия перевозки; тарифный барьер; единый рынок; ограничения.

Answer the questions:

1. What is globalization?
2. Why do protectionist measures become less popular within many countries nowadays?
3. What industries are mentioned in the text?
4. What issues are usually discussed at trade negotiations?
5. What is comparative advantage?

Up to you

You work in the agriculture industry. Your organization exports its goods and services. Is it protected from overseas competition? How? What other industries should be protected?

Links if you want to know more about trade and read publications on trade and globalization related issues, visit

http://universalium.academic.ru/272856/international_trade

http://www.imf.org/external/np/exr/Key/global.htm

Дата добавления: 2015-11-04