INB 3305 Ch. 14

Japan’s ministry of international trade and industry (always on the lookout for export opportunities)
MITI
Japan’s great trading houses (offices all over the world and proactively seek export opportunities for their affiliated companies large and small)
Sogo Shosha
Export specialists who act as an export marketing department for client firms
export management company
Issued by a bank, indicating that the bank will make payments under specific circumstances
letter of credit
An order written by an exporter introducing an imporer, or an importer’s agent, to pay a specified amount of money at a specified time
Bill of exchange
A draft payable on presentation to the drawee
sight draft
a promise to pay by the accepting party at some future date
time draft
A document issued to an exporter by a common carrier transporting merchandise; it serves as a receipt, a contract, and a document of title
bill of lading
Agency of the US government whose mission is to provide aid in financing and facilitate exports and imports; also referred to as the Ex-Im bank
Export Import bank
____ __ _____ is the instrument normally used in the international commerce to effect payment
bill of exchange
Two types of drafts:
sight draft; time draft
When a time draft is drawn on and accepted by a bank, it is called a :
bankers acceptance
When a time draft is drawn on and accepted by a business firm, it is called a:
trade acceptance
3 purposes the Bill of Lading serves as:
receipt, contract, and document of title
The trade of goods and services for other goods and services that cannot be traded for money
countertrade
The direct exchange of goods or services between two parties without a cash transaction
barter
A reciprocal buying agreement
counter purchase
A buying agreement similar to counter purchase, but the exporting country can then fulfill the agreement with any firm in the country to which the sale is being made
offset
The use of a specialized third party trading house in a countertrade arrangement
switch trading
When a firm builds a plant in a country and agrees to ale a certain percentage of the plants output as partial payment of the contract
buyback
5 types of countertrade:
1) barter
2) counter purchase
3) offset
4) switch trading
5) compensation (buyback
Which type of countertrade is viewed as the most restrictive arrangement?
barter
Which type of countertrade is when a firm agrees to purchase a certain amount of materials back from a country to which a sale is made?
counter purchase
Which type of countertrade occurs when a third-party trading house buys the firm’s counter purchase credits and sells them to another firm that can better use them?
switch trading
Countertrade’s main attraction is that it can give a firm a way to finance an _____ _____ when other means are not available.
export deal