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Trade
-Trade Policies :
--Import restrictions: If a country doesn't want a particular product of one or more countries to be imported into it then in order to prevent them it can impose import restrictions.For example if a country doesn't want wheat to be imported into it then it might either ban the imports of wheat or set a limit to wheat imports or else it might impose very high taxes on wheat imports.
--Export incentives: In order to encourage exports countries offer export incentives to exporting in the form of tax exemptions cheap power cheap raw materials and so on .These are called Export Incentives.
-Bank of International Settlements: It's purpose is to help various central banks to carry out receipts and payments among each other.
-c.i.f : It means cost insurance& freight or charged in full .This is the total cost of an imported
product.
-Foreign Direct Investments(FDI):If a company of one country goes to another country and invests in a company or starts its operations in that country then the investment made by the company is called FDI.
-Globalization : It is the process of expanding trade among different countries . That is being to avail the cost reductions that might result if a product is produced in a different country . For example electronic components are manufactured in Taiwan since they are the lowest coat producers of electronic components and these are then shipped to china where they assembled into a TV set since assembling costs are cheaper in china and then they are exported to USA.
--Outsourcing: It is the process of contracting the production of a product which was produced
internally to an external company. It is done primarily done to reduce cost of production since the external company might be able to produce that product cheaply
-- B.P.O. : It stands for business process out sourcing .It means the outsourcing internal business processes like payroll management, transaction handling to external companies .
--M.P.O. : It stands for manufacturing process outsourcing. I means the outsourcing the
manufacturing the manufacturing of a component or an entire product to an external company.
-Carbon Credits: In order to meet it's commitments to the Kyoto Protocol the EU imposed conditions on its polluting industries that they should either reduce their pollution or buy carbon credits from industries that are eco friendly. Each eco friendly is certified by an agency the extent to which it prevents the emission of carbon(in tonnes).then based on this rating the polluting buy these certificates from the non polluting companies for a certain fixed price.
-Invisible balance: While importing a good several extra costs are added to it when in lands on the destination port .These include freight ,insurance and other costs. These type of costs are called invisibles. Only the original cost of the product is considered as visible.
-EXIM Bank : The sole purpose of these banks will be to offer financial assistance to companies engaged in exports and imports. This will be in the form of credit or guarantees.
-Clearing house: It is an institution which helps in clearing the e receipts and payments between different agencies.
-BOP(balance of Payments):It is the amount of money a country earns from it's external trade.
for example:
Imports = $100,0000
Exports = $ 200,000
Then BOP = $(200,000 - 100,000) = $100,000.
i.e; the country earns $100,000 from its external trade
