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

2. 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

3. 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

4. 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

5. 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

6. 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

7. 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

8. 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

9. 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

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

11. 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

12. 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

13. Resources
English in Economics, Miroslav Kaftan, Libuše Horáková:, Karolinum 2004
Market Leader, D. Cotton, D. Falvey, S. Kent, Pearson Longman, 2007
©Lenka Lexová