International trade VOŠ – 2. ročník – 2. semestr ©Lenka Lexová

International trade exchange of goods and services across international borders export and import is any good or commodity, transported from one country to another country it is an important part of GDP and an important factor of economic growth ©Lenka Lexová

Balance of payments measures the payments between any individual country and all other countries sums up all international economic transactions for a country during a specific time period, usually a year it shows all exports and imports of goods, services, and financial capital, as well as financial transfers of a country it reflects all payments to foreigners - debits and all payments received from foreigners - credits ©Lenka Lexová

Components of balance of payments visible balance of trade - difference between exports and imports of visible goods over a certain period of time invisible balance or balance of trade on service - consulting services, tourism, banking capital account – it measures capital inflow and outflow, foreign direct investment, plus changes in holdings of stocks, bonds, loans, bank accounts, and currencies ©Lenka Lexová

Protectionism a variety of restrictive government regulations designed to protect domestic industries it includes high tariffs on imported goods, restrictive quotas, custom duties ©Lenka Lexová

International agreements A trade pact of some countries which often leads to creating integrations such as: Free trade zones Custom unions with no duties inside and common duties outside Common market International agreements on raw materials ©Lenka Lexová

International organisations EFTA European free trade association EU European Union EMS European Monetary System CEFTA Central European Free Trade Agreement NAFTA North American Free Trade Agreement WTO World Trade Organization OECD Organisation for Economic Co-operation and Development ©Lenka Lexová

Methods of payment By the letter of credit Against documents Open account – goods are shipped directly with a request for payment Advance payment – goods are sipped after the payment Which method is the safest, which is the most risky? ©Lenka Lexová

Discuss Is selling a product in other countries more difficult than at home? Why? What can cause problems? Creditworthiness of customers, different needs, local mentality, habits? Which Czech products are exported? Which products do we need to import? Is it always necessary? What is better for an economy, higher imports or exports? Why? ©Lenka Lexová

Listening Nils, on working life in the UK Worksheet Transcript Martha, on working life in the UK ©Lenka Lexová

Answer the following questions Do you know any international companies with branches in the Czech Republic? Do you know any Czech companies which successfully make business abroad? Would you like to work in an international company/abroad? What are the advantages and disadvantages of being an employe in such a firm? What skills are needed? ©Lenka Lexová

Imagine the following situation You are at an international conference in Moscow an meet someone you know, make a small talk: Student A You met B at a conference 2 years ago in London You are product manager in a large German company You have been here for 5 days You have visited the city, make recommendation what to see You are staying in a small guest house in the suburbs, bad choice, no facilities, complain You are leaving tomorrow You do not like the conference, why? Student B You met A at a conference 2 years ago in London You run a small firm which sells electronics It is your first day here, you haven´t seen the city You are staying in Grandhotel in the centre, excellent accommodation You are leaving in three days You like the conference, why? ©Lenka Lexová

Resources English in Economics, Miroslav Kaftan, Libuše Horáková:, Karolinum 2004 Market Leader, D. Cotton, D. Falvey, S. Kent, Pearson Longman, 2007 http://www.businessenglishonline.net/ www.wikipedia.org ©Lenka Lexová