Foreign Trade | Jamb Commerce

Basic Issues in Foreign Trade

1. Balance of Trade: The difference between a country’s exports and imports of goods.
2. Trade Surplus: Occurs when a country exports more than it imports, resulting in a positive balance of trade.
3. Trade Deficit: Happens when a country imports more than it exports, leading to a negative balance of trade.
4. Balance of Payments (BOP): A comprehensive record of all economic transactions between a country and the rest of the world over a period of time.
5. Current Account: A component of the BOP that includes trade balance, net income, and current transfers.
6. Capital Account: Part of the BOP that records financial transactions like investments and loans.
7. Counter Trade: A form of international trade where goods and services are exchanged for other goods and services instead of money.
8. Barter System: The direct exchange of goods or services without using money, often seen in counter trade.
9. Export Credit: A financing method that helps exporters secure loans to cover the cost of international trade.
10. Import Substitution: A strategy used by countries to reduce reliance on imports by encouraging domestic production.
11. Exchange Rate Risk: The financial risk faced by businesses or investors from fluctuations in currency exchange rates during international trade.
12. Trade Protectionism: The practice of restricting international trade through tariffs, quotas, and other trade barriers to protect domestic industries.
13. Trade Liberalization: The removal or reduction of restrictions and barriers to international trade.
14. Favorable Balance of Trade: When a country exports more than it imports, positively influencing its economy.
15. Unfavorable Balance of Trade: A situation where a country’s imports exceed its exports, leading to a trade deficit.
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Procedures and Documents Used in Export, Import, and Entrepôt Trade

16. Export Declaration: A document that provides information about the goods being exported, including their nature and value.
17. Proforma Invoice: A preliminary invoice sent by a seller to a buyer, detailing the expected costs of goods or services before the transaction.
18. Letter of Credit (LC): A financial document issued by a bank guaranteeing payment to the seller upon fulfillment of terms and conditions in the contract.
19. Bill of Lading: A document used in shipping that serves as proof of the contract of carriage and receipt of goods.
20. Commercial Invoice: A bill provided by the exporter to the importer that lists the products and prices of the goods being sold.
21. Certificate of Origin: A document that certifies the country in which the goods were manufactured or produced.
22. Packing List: A document listing the contents of a shipment, including weights, dimensions, and packaging details.
23. Import License: A government permit required to import certain goods into a country.
24. Customs Declaration: A document that provides customs officials with the necessary information to assess and process imported goods.
25. Consignment Note: A document that acts as proof of shipment from the consignor (exporter) to the consignee (importer).
26. Insurance Certificate: A document that provides proof of insurance coverage for the goods being transported.
27. Export License: A government authorization allowing the export of certain controlled goods.
28. Import Duty: A tax imposed by a government on imported goods.
29. Tariff Code (HS Code): A standardized code used internationally to classify traded goods.
30. Entrepôt Trade Documentation: Documentation used in entrepôt trade, where goods are imported for re-export without significant transformation.
31. Customs Bond: A guarantee posted by the importer to ensure compliance with customs regulations.
32. Import Quotas: Restrictions set by governments on the quantity of a specific product that can be imported.
33. Customs Invoice: A detailed invoice used to clear goods through customs that includes the cost, value, and origin of goods.
34. Certificate of Inspection: A document certifying that the goods have been inspected for quality or standards compliance before export.
35. Import/Export Declaration Form: A form used by customs authorities to declare the arrival of goods for import or export.
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Barriers to International Trade

36. Tariffs: Taxes imposed on imported goods to protect domestic industries or generate government revenue.
37. Quotas: Limits on the number or value of goods that can be imported or exported during a given period.
38. Non-Tariff Barriers: Barriers that are not in the form of taxes but still restrict trade, such as import bans or product standards.
39. Subsidies: Government financial assistance to local producers, which can make their products cheaper compared to foreign goods.
40. Import Licensing: A process that requires importers to obtain permission before bringing specific goods into a country.
41. Currency Manipulation: A country's deliberate actions to influence the exchange rate to benefit its export market.
42. Dumping: When a country exports goods at prices lower than their production cost to gain market share, potentially harming local industries.
43. Administrative Barriers: Complex documentation, inspections, or customs processes that slow down or discourage international trade.
44. Political Barriers: Trade restrictions imposed by governments due to political disagreements or to exert influence.
45. Cultural Barriers: Differences in language, customs, and preferences that can hinder trade between countries.
46. Geographic Barriers: Natural barriers like distance, oceans, or mountains that increase the cost or difficulty of trade.
47. Technological Barriers: Differences in technological infrastructure or production methods between countries that can hinder trade.
48. Intellectual Property Barriers: Restrictions that prevent foreign firms from using local technologies or patents.
49. Standards and Regulations: Differences in product standards and regulations can limit market access for foreign goods.
50. Import Restrictions: Policies that limit the quantity or types of goods that can be imported to protect domestic markets.
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Role of Customs and Excise Authority in Foreign Trade

51. Regulate Import and Export: Customs and Excise Authorities enforce regulations that govern the movement of goods across borders.
52. Collecting Duties and Taxes: They ensure the collection of tariffs, excise duties, and taxes on imports and exports.
53. Protecting National Security: Customs authorities monitor goods entering or leaving the country to prevent the importation of harmful or prohibited items.
54. Ensuring Compliance: Customs authorities ensure that goods comply with national laws, including health, safety, and environmental standards.
55. Issuing Import Permits: They issue permits required for certain goods to be imported into the country.
56. Monitoring Trade Flow: Customs authorities track trade data to prevent illegal activities like smuggling.
57. Customs Enforcement: They enforce policies on prohibited or restricted goods to maintain public safety and national interests.
58. Border Control and Inspections: Customs officials inspect goods at borders to ensure they meet regulatory standards.
59. Facilitating Trade: By simplifying customs processes, customs and excise authorities can reduce delays in international trade.
60. Trade Data Collection: Customs agencies collect and maintain data on trade transactions, which is vital for analyzing the country’s trade patterns.
61. Enforcement of Trade Agreements: Customs ensures that international trade agreements are honored and adhered to.
62. Anti-smuggling Operations: Customs and Excise Authorities are involved in identifying and preventing illegal trade practices.
63. Import/Export Audits: Conducting audits to ensure that proper duties and taxes are paid on goods entering or leaving the country.
64. Regulating Duty-Free Zones: Customs regulates special economic zones or free trade zones where goods can be imported without paying duties.
65. Issuing Certificates of Origin: Customs can issue certificates to verify the origin of goods to ensure compliance with trade agreements.
66. Combatting Intellectual Property Violations: Customs authorities monitor and prevent the import of counterfeit goods that violate intellectual property rights.
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Role of Ports Authority in Foreign Trade

67. Manage Port Operations: Ports Authority ensures the smooth operation of ports, including loading, unloading, and storage of goods.
68. Facilitate Customs Procedures: Ports Authority coordinates with customs authorities to ensure timely clearance of goods.
69. Infrastructure Development: Ports Authority is responsible for developing and maintaining port infrastructure, such as terminals, docks, and storage facilities.
70. Safety and Security: Ports Authority ensures the safety and security of goods, vessels, and port facilities.
71. Environmental Management: Ports Authorities manage environmental impacts from port operations, including waste disposal and water quality.
72. Logistics and Transportation: They coordinate transportation services such as rail and road connections to facilitate goods movement beyond the port.
73. Handling Dangerous Goods: Ports Authority has special procedures in place to handle hazardous materials safely.
74. Customs and Port Integration: Collaborating with customs for efficient processing of goods arriving or departing from ports.
75. Port Fees and Tariffs: Ports Authority sets and collects fees for port services, including docking, warehousing, and handling of goods.
76. Port Expansion and Upgrades: Ports Authority oversees the expansion and modernization of port facilities to meet growing trade demands.
77. Regulating Import/Export Practices: Ports Authority ensures that only legally compliant goods enter or leave the country via the port.
78. Promoting Trade Efficiency: By improving port operations, Ports Authorities can reduce shipping costs and increase trade volumes.
79. Port Infrastructure Financing: Ports Authority may seek funding or investments to improve port facilities and services.
80. Strategic Port Locations: Ports Authority chooses and develops strategic locations for ports to ensure optimal international connectivity.
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Role of Government Agencies in Foreign Trade

81. Trade Policy Formulation: Government agencies establish policies and regulations to guide and regulate international trade.
82. Trade Promotion: Government agencies promote exports and foreign investments through various schemes and initiatives.
83. Negotiating Trade Agreements: Agencies play a role in negotiating international trade agreements and treaties that facilitate trade.
84. Economic Diplomacy: Governments use diplomacy to foster trade relations with foreign nations.
85. Export Subsidies: Government agencies may provide financial assistance to encourage local businesses to export.
86. International Trade Facilitation: Government agencies simplify and streamline procedures for international trade to make it more efficient.
87. Protecting Domestic Industries: Through tariffs and quotas, government agencies protect local industries from unfair competition.
88. Trade Intelligence: Government agencies provide businesses with market intelligence to help them navigate international trade opportunities.
89. Regulatory Oversight: Government agencies oversee compliance with trade laws, ensuring that businesses follow regulations.
90. Managing Trade Deficits: Government agencies may intervene to address trade imbalances and support the national economy.
91. Customs and Excise Oversight: Government agencies oversee the work of customs and excise authorities to ensure smooth trade flows.
92. Anti-Dumping Regulations: Government agencies monitor and enforce laws to prevent unfair dumping of products into domestic markets.
93. Export Credit Agencies: Government-run agencies offer financial assistance to exporters by providing credit and insurance to mitigate trade risks.
94. Trade Education and Training: Government agencies offer programs to educate businesses about international trade rules and opportunities.
95. Sanctions and Embargoes: Governments use sanctions and embargoes as tools to restrict or encourage trade with certain countries.
96. Anti-Corruption Measures: Government agencies implement measures to reduce corruption in international trade and customs processes.
97. Investment Promotion: Governments establish agencies that promote foreign direct investment (FDI) to boost trade and economic growth.
98. Trade Dispute Resolution: Government agencies may help mediate and resolve trade disputes between local businesses and foreign partners.
99. Building Trade Infrastructure: Government agencies are responsible for investing in and maintaining critical infrastructure like transportation networks and customs facilities.
100. Managing Foreign Exchange Reserves: Government agencies manage foreign exchange reserves to stabilize the national currency and support trade.

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