unit 1 import and export - In English

International trade
UNIT 1
IMPORT AND EXPORT
248
Business theory
WHAT IS INTERNATIONAL
TRADE?
International trade takes place when partners
engage in trade, crossing frontiers1 between
different countries. The partner who sells (exports)
is called the exporter and the buyer is referred to as
the importer. The earliest example of international
trade was in the form of barter2 transactions.
What is the World Trade Organization?
The World Trade Organization (WTO) defines itself
as “the only global international organization
dealing with the rules of trade between nations. At
its heart are the WTO agreements, negotiated and
signed by the bulk3 of the world’s trading nations
and ratified in their parliaments. The goal is to help
producers of goods and services and exporters and
importers conduct their business.”
What is the difference between fair trade
and free trade?
If you look up “free trade” in a dictionary, you will
find this definition: “trade between nations without
protective customs tariffs4”. This is the aim of the
World Trade Organisation, moreover, broadening5
it to other government-controlled obstacles, such
as import quotas. Free trade supporters believe that
if similar barriers are removed, then trade will flow
freely across borders and the best producer will gain
the upper hand.
Fair trade is a term used broadly by various groups,
such as social justice, peace and environmental
groups, to contrast with “unfair” trade practices, and
sometimes with free trade as promoted by the World
Trade Organization and NAFTA (the North American
Free Trade Agreement).
Fair trade can be an opportunity for less developed
countries to expand their business locally and be
supported by ethical banks to gain a position in the
market. Moreover fair trade supporters believe in a
market where cooperation, rather than aggressive
competition, is supported.
What are Incoterms?
When negotiating an international sales contract,
both partners need to pay attention to the terms
of sale. To make them as clear as possible, most
countries have adopted an international set of
trade terms (Incoterms), which defines exactly the
responsibilities and risks of both the importer and the
exporter, including the period when the merchandise
is in transit.
The eleven rules are fundamental to international
trade, laying down the most significant
responsibilities of trading partners in international
sales contracts. Customs authorities and courts6
everywhere recognise Incoterms as international
standard. Since they were first published in 1936,
Incoterms – a trademarked International Chamber
of Commerce (ICC) product – have been revised six
times.
NOTES
1. confini
2. baratto
3. maggioranza
4. tariffe doganali
5. ampliare
6. tribunali
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MY TOOL KIT
❶ Read the text and answer the following
questions.
THE LANGUAGE OF TRADE
A Complete the following dictionary entries
using the following words.
protectionism – export – quota – deregulation
– tariff
1.
2.
4.
5.
249
MODULE 8 International trade / 1. IMPORT AND EXPORT
3.
A
is a tax on imports or
exports, or a list of prices for things such as
rail service, bus routes and electrical usage.
A
is a prescribed number
or quantity, for example of items to be
manufactured, imported, or exported,
immigrants admitted to a country, or
students admitted to a college.
To
: to send or transport
(a commodity, for example) abroad,
especially for trade or sale.
: freeing from regulation,
especially removing government
regulations from trade, and the circulation
of goods.
: the practice of
protecting domestic industries from
foreign competition by imposing import
duties or quotas.
1. What does the World Trade Organization
deal with?
2. What is the meaning of free trade?
3. What does NAFTA stand for?
4. Which countries can benefit from fair trade
and in what ways?
5. How are Incoterms defined in the text?
6. When were Incoterms first published?
EASY FOR YOU
❷ MY CONTENT SUMMARY Fill in the gaps with the following words.
fair – ethical – another – exporters – contracts – barriers – terms – less developed –
World Trade Organization – market
WTO is an acronym that stands for (1)
and (2)
, which helps importers
conduct their business. When we talk about trade, there are two
ways of approaching business: free trade and (3)
to remove any (4)
trade. Free trade aims
that can prevent goods from flowing freely from one
country to (5)
. On the other hand, when we refer to fair trade we mainly talk
about (6)
countries and local companies that are trying expand
their (7)
and can be supported in their growth by (8)
banks.
To simplify trade, Incoterms were published in 1936. Incoterms are an international set of trade
(9)
that define the responsibilities of importers and exporters in international
(10)
.
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➌ Match the following words with their Italian translation.
250
•
•
•
•
•
•
•
•
•
•
•
•
1. e dumping
protectionism
2.
Common Customs Tariff
3.
World Trade Organization
4.
subsidies
5.
tariffs
6.
free circulation of goods and people
7.
to export
8.
embargo
9.
to import
10.
quotas
11.
freight
12.
a.
b.
c.
d.
e.
f.
g.
h.
i.
j.
k.
l.
quote
importare
esportare
trasporto di merci, nolo, costo del trasporto
di merci
esportazione sottocosto
protezionismo
embargo
Organizzazione Mondiale del Commercio
sovvenzioni
libera circolazione di beni e persone
tariffe
Tariffa Doganale Comune
❹ Match the following words with their definitions.
dumping – protectionism – Common Customs Tariff – subsidies – tariffs – free circulation of goods and people –
embargo – import – quotas – freight – export
1.
2.
3.
4.
5.
: when companies sell their products to other countries
: when companies buy products from abroad
: commercial transport of goods by air, land and sea
: restrictions to trade made to protect domestic companies and people’s jobs
: a ban on the export or import of goods with particular countries for
political reasons (for example the American one against Cuba because it has a communist regime)
: financial support given by the government to domestic producers to
6.
make them more competitive on the international market
: the limit placed on the quantity of foreign goods that can be imported
7.
into a country (for example the UK has limits on the numbers of cars that can be imported from Japan)
: taxes imposed on imported goods to make them more competitive
8.
or to discourage consumers from buying foreign products (for instance, the US puts these taxes on
Italian and French wine to make Californian wine more competitive, or the UK puts taxes on Italian
clothes to discourage consumers from buying them)
9.
: harmonised taxation in a wide commercial area across national borders
10.
: the freedom for the workforce to find work abroad and for products
to be sold anywhere in the world without border controls or VAT and with a standard certification system
11.
: to export goods at a very low price so that they become competitive
on the foreign market (for example, this policy is used by Chinese exporters throughout the world
to promote their goods by offering them at very cheap prices, regardless of quality)
❺ WORDS IN CONTEXT Fill in the gaps with some of the words from Exercise 4.
1. Today there is more competition between students regarding their qualifications than in the past,
because there is
in the EU.
2. Some governments use
to protect their domestic companies and
prevent foreign companies from entering the domestic market.
3.
is an unfair policy because consumers aren’t guaranteed the quality
of the goods purchased.
4.
prevent foreign products from invading the domestic market.
5. Italian fashion designers
their clothes all over the world.
Gaia Ierace, Paula Grisdale, Down to Business © Loescher Editore, 2016
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