Countertrade includes a range of barterlike agreements and may be considered a form of payment. Please identify a country of the world where a countertrade agreement may exist and explain why. Be quick though… you may not use a country that another classmate has used in their posting!
Production and Logistics (half page)
This week we analyzed and evaluated an array of topics in the area of production and logistics for the international firm. We identified and discussed countertrade, export financing, and reviewed some of the documents used to facilitate those processes.
An external link allowed you to review some of the most common documents used in export financing. Now, think about this question and post your response.
Which document used in export financing serves the following three (3) purposes:
- Receipt for services by the firm providing carriage (e.g. steamship line, airline)
- Establishes a document of title (document of title in this instance is defined as the temporary ownership of the goods needed to allow entry into the country that the goods will be sold in)
- Establishes contractual services by the firm and seller of the goods for carriage
How would you use this document?
Answer preview
There are different methods used for charging and payment in trade. One is counter-trading which is used in payment by offering goods instead of money (Feenstra, 2015). Peru is one of the countries that use counter-trading in business. Counter trading is in the international, national and local level in Peru. Since the state has a significant foreign debt, they pay off most of their obligations by offering goods to their creditors. For example, Inter-American Development Bank, United States Agency for International Development among others. In the international level, the country also pays commercial banks using counter trading, for example, The Midland bank of London and Allied Bank International etcetera…
