international marketing 2 : international trade
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DMK2013International Marketing
Chapter 2: The Dynamic Environment of International Trade
Sakinah Shukri @MSUmalaysia
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World Trade
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Trade : Transfer of ownership of goods from one person to another by getting something in exchange from buyer
International Trade: beyond national boarders
Why we need International Trade-Globalize our product-Demand from other country-Competition
International Trade
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http://www.trade.gov/mas/ian/build/groups/public/@tg_ian/documents/webcontent/tg_ian_003364.pdf
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The system of accounts that records a nations international financial transactions.
Maintained on a double entry bookkeeping Transaction is annually and need to be
balanced International Economic Position (central
bank, gov agency, treasuries )
Balance of Payment
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1.Current Account (Value.of Company)exports, imports, service to transfer fund
activity2.Capital Account Direct investment, portfolio investment, short
term capital movement3.Reserves AccountExport and imports of gold
3 ACCOUNT (BOP) PG34
Foreign exchange & liabilities
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A Economic policy of retraining trade to protect the infant market
It will help to protect fair competition between goods and services
8 Policies
Protectionism
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Protect of infant industry Protect home market Need to keep money at home market Encouragement of capital accumulation Maintenance of the standard of living and
real wages Conservation of natural resources National Defense Bargaining
Why we need Protectionism (pg35)
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Government establish the barrier, control activity
Tariffs Quotas Voluntary Exports Restraints (VER) Boycotts and embargoes Monetary Barriers Standards Anti dumping penalties
Trade Barrier (PG37)
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1. Tariffs- tax imposed by a government on goods entering at its borders
2. Quotas- specific unit or dollar limit applied to a particular of goods
3. Voluntary Export Restraints- Similar to quotas but follow market agreement (Textile)
4. Boycott and Embargoes- gov restriction against a particular product
5. Monetary Barrier- through blocked currency and exchange rate
6. Standards- protect and check quality and health
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New anti dumping penalties had emerged to form a new tariff and non tariff.
Keeping foreign market out of a market “Predatory market”- a foreign producer
intentionally sells its product in the United States for less than the cost of production.
Anti Dumping Penalties
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General Agreement on Tariffs and Trade 1. Trade shall be conducted on a non
discriminatory basis2. Protection shall be afforded to domestic
industries through customs tariffs3. Consultation shall be the primary method
used to solve global trade problems-legal basis for further negotiations and aimed
eliminating barriers
GATT
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World Trade Organization - Sets many rules governing trade- Provide a panel exports to hear and
systemize rules- Issues binding decision - Equal representative- Bond their market and open more activity
WTO (PG 44)
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Global Institutional Help to maintain stability in the financial
markets and by assisting countries that are seeking economic development and structure
Stabilize foreign exchange rate Promote growth international trade
IMF (pg45)
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Reduce poverty and improve standard of living
1. Lending money to gov2. Assistance to gov development project3. Lending money to private sector 4. Provide investor “non commercial risk”5. Promote growth of international investment
World Bank Group
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WTO http://www.wto.org/english/thewto_e/whatis_e/tif_e/org6_e.htm
Sak.Onkvisit., & John J.Shaw.,(2009) International Marketing: Strategy and theory.5th edn.Milton Park.Routledge
http://www.oecd.org/eco/growth/2501905.pdf (Trading between Develop and Developing Countries)
Reference