LIBERALISATION Vs CONTROL OF INTERNATIONAL BUSINESS

Foreign Trade Export & Import.

Export :

 Forex Resere
 Employment
 Auxillary Units
 Currency strengthness
 BOT

Import :

 Forex Resere
 Employment
 Auxillary Units
 Currency strengthness
 BOT

BOT = EXPORT – IMPORT.

BOP = BOT + Other Factors (Investment,Loan,Economic Aid etc;)

BARRIERS TO INTERNATIONAL BUSINESS :

Control :

i. Tariff barriers (Tax/Duty on incoming goods/services).

ii. Non-Tariff barriers.

I. TARIFF BARRIERS

Dumping is said to happen when a country sells a particular product in a

foreign country at a price lower than its domestic price.

A. Anti Dumping Duty:

Inorder to offset the effect of dumping,anti-dumping duty is changed.

B. Counter Veiling Duty/Counteracting Duty:

Goernment Incentives to Export ($ 2)

Example:

1 Unit cost of production = $7.

Government Incentie = $2

Net cost of production = $5

Foreign country charges a duty equivalent to the incentives ($2).

This is countereiling Duty.

C. Revenue Duty:

Tax for generating income/reenue to the government.

Restrictive Duty To restrict the inflow of goals/services into a

country.(Eg:Anti Dumping Duty;Contereiling Duty)

Non-Restrictie Duty Revenue Generation Purpose.

II. Non-Tariff Barrier:

1. Difficult Quality Conditions. (Eg: Six-Sigma)
2. Irrational Product specifications.
(Eg: Internal wiring Eye pattern in wooden furniture)
3. Procedural Delay. (Eg: customs-clearance (Red Tapism))
4. Restriction on part of entry.
5. Country specific product restrictions.
6. Goernment clearance.