INERNATIONAL TRADE The process of buying and selling goods and services between countries Countries can import or export: a) visible goods: the ones you can see (e.g. clothes; cars) b) invisible goods: services (banking, tourism, insurance)

Balance of trade and balance of payments (p 33) Balance: difference between the amount a country spends on IMPORTS and the amount it receives from EXPORTS Balance of trade (ONLY visible goods) Balance of payments => visible & invisible goods BoP: SURPLUS = EXPORTS >IMPORTS BoP: DEFICIT = EXPORTS <IMPORTS

Foreign trade controls Governments implement protection policies through: Tariffs on imports =CUSTOMS DUTIES= taxes on imported goods) Quotas = limit on the quantity of foreign goods coming into a country Subsidies: money given to domestic producers to make them more competitive Embargoes: ban on the export/import of certain goods

MULTINATIONAL TRADING BLOCKS Groups of contiguous countries that agree to adopt common trading/protectionist policies for the rest of the world, but have preferential treatment towards one another THE EU (1992 - 1957:ECC) NAFTA (North American Free Trade Agreement – 1994) MERCOSUR (southern Cone free trade area - Argentina, Brazil, Paraguay, Uruguay 1991) Asean (Association of South East Asian Nations – 1967)

PROMOTING INTERNATIONAL TRADE WTO World Trade Organisation IMF International Monetary Fund The World Bank Listening p. 35 tr 7

Documents in international trade Within the EU (since 1993)= goods exempt of VAT VIES /vaiz/ = VAT Information Exchange System (companies can get confirmation of VAT numbers (partita IVA) and administrations VIMA (VIES Intrastate and Mutual Assistance) = office where exporters send a VIES statement (monthly or every 3 months)

Documents in international trade Outside the EU SAD = Single Administrative Document used to declare imports and exports and to remove goods from customs procedures (sdoganare) CERTIFICATE OF ORIGIN signed by the exporter’s Chamber of Commerce = necessary because the rate of customs duties on imports varies depending on the origin of the goods (e.g p. 39)

TRANSPORT DOCUMENTS - 1 The DELIVERY NOTE … …contains the details of the goods (NO prices) …is signed on arrival by the importer to state that he accepts the goods …the carrier keeps a copy as proof of delivery

TRANSPORT DOCUMENTS - 1 The COMMERCIAL INVOICE= a document that the exporter sends to the importer with information about importer/exporter details invoice number place/date of issue order number description of the goods unit amount/total amount Terms (INCOTERMS) PROFORMA INVOICE = statements of costs to be paid before the goods are delivered

INCOTERMS = International Commercial Term pp.42-43 13 standard terms established by the ICC (International Chamber of Commerce) they define the respective responsibilites of exporter/importer as to: -Transport costs -Risks/insurance -Customs duties and formalities -Loading/unloading

INCOTERMS E- TERMS (EXW= ex works) goods are placed on the seller’s premises at the diposal of the buyer, and become his responsibility from then on F-TERMS (FCA, FAS,FOB = free…) the buyer is responsible for the cost and risk of international carriage C-TERMS (CFR, CIF, CPT, CIP = freight/carriage paid to…) the seller pays for international carriage, but does not bear the risks… D-TERMS (DAF, DES,DEQ, DDU, DDP= delivered….) the seller bears all costs up to the delivery point…

TRANSPORT BY ROAD = - couriers on motorbikes - Road haulage firms carriers (small areas) - TIR (Transport International Routier) lorry BY RAIL= freight service, esp. for bulk materials (chemicals, petrol cement)

TRANSPORT SEA TRANSPORT - Freighter = large ship (or plane) carrying goods - It can transport almost unlimited weight BY AIR= Goods of limited size/weight PIPELINES = Liquids, gas, oil (to oil refineries or ports)

TRANSPORT Forwarding agents = experts in the transportation of goods/freight shipment; they arrange: insurance packaging, storing, transporting Documentation Accidents/damages Customs formalities Logistics = the process of planning, implementing, and controlling the effective and efficient flow of goods and services from the point of origin to the point of consumption.

INSURANCE Protection of people and goods against accidents, risks, loss Key terms: - The Insurer/underwriter =company providing the insurance - The insured = company/person requiring the insurance - Policy = document specifying the terms… - Premium = amount of money paid by the business Claim = formal request of payment in case of accident/loss E.g of early insurance company :Lloyd’s London, coffee houses, 18th century

PACKING/packaging DRUM (barile) BARREL (botte) CASE (cassa in legno/chiusa) CRATE (cassseta /aperta) BAG/SACK sacco CARTON scatola in cartone BALE balla CONTAINERS (CONTAINERISATION) = steel boxes of standard size ; loaded as sealed units

TRANSPORT DOCUMENTS - 2 INTERNATIONAL ROAD CONSIGNMENT NOTE(CMR) = lettera di vettura THE AIR WAYBILL = lettera di vettura aerea Both contain: NAMES AND ADDRESSES OF CONSIGNOR/SENDER, CONSIGNEE, CARRIER DESCRIPTION OF GOODS, DATE/PLACE OF DEPARTURE CARRIAGE CHARGES THE BILL OF LADING= polizza di carico (sea tr.)

TRANSPORT DOCUMENTS - 2 Do ex pp 58-59