Chapter 1- OVERVIEW

Giảng viên:
PHẠM THỊ NGÂN

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 Learning Objectives

1 Define what is meant by international trade ;

1
2 Explain the reasons for engaging in IT;

3 Identify the benefits of IT

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 Learning Objectives

Learning Outcomes
4 Explain the major categories of IT

5 Tell the difference between Domestic and IT

1
65 Understand the major procedure involved IT
1
5

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 Main Contents

1 Reasons for International Trade;

12
Difference between Int-Trade & Dom-Trade;
Classification of International Trade;
34
Export and import procedures;
5 Key terms
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 1.1 Reasons of International Trade

Resources
Resources

International
Trade
Economics
Reasons

Benefit
Other

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 Resource Reasons

Resource
Reasons

Some nations The developed

possess natural countries are full of
resources in excess skilled labor, capital
of their own and technological
requirements while resources while the
other nations have developing countries
none may lack them
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 Economics Reasons

Economics Benefits
1

Theory of comparative advantage

2 (David Ricardo)

Open up new market in other

3
nations
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 Other reasons

Natural resources, technological resources,

human resources, cost of production, political
strength, tastes, preferences and consumption
patterns, etc.

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 Benefits of International Trade

3
Larger Cheaper
Greater
Economic Goods or
Variety
Growth services

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 1.2 Differences between
Int-Trade & Dom-Trade

Communication Languages & cultures

systems

Customs & Foreign law

regulations

Risk Foreign currencies

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 1.3 Classifications of International Trade

Export, import and Transit

Direct, Indirect and Entrepôt

Visible and Invisible

Barter and Free-liquidation

International
Trade
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 1.4 Overview about export
, import and transit

Customs
District Offices Borde Tân Thuận
7 r Export processing
zone

Exporter Importer
Exporter Importer

Customs Border
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 Exporting

Be taken out of
Vietnam

Be put in special areas in

Vietnam

EPZs
Industrial Zones
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…
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 1.4.1 Exporting

• Reasons to export
– To serve markets where the firm has no or limited
production facilities
– To satisfy a host government’s requirement that
the local subsidiary have exports
– To remain price-competitive in the home market
– To test foreign markets and foreign competition
inexpensively

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 Reasons to export?
– To offset domestic market’s cyclical sales;
– To achieve additional sales;
– To extend a product’s life cycle;
– To respond strategically to foreign competitors;
– To achieve the success the firm’s
management has seen others achieve;
– To improve the efficiency of manufacturing
equipment.
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 Reasons not to Export
• Two major reasons
– Preoccupation with the vast American market
– Reluctance to become involved in a new,
unknown and therefore risky operation
• Not active in international markets due to
– Lack of knowledge
• Locating foreign markets
• Payment and financing procedures
• Export procedures

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 Top exporting commodities in 2016

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 1.4.2 Importing

Be put in Vietnam

Be taken out of special

areas in Vietnam

EPZs
Industrial Zones
…
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 1.4.2 Importing

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 Transit

Vietnam
Import Export
Procedures Procedures

Goods
A B

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 Transit

Goods
A B

Vietnam

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 Transit

Vietnam

Import Export
Procedures Procedures

Goods
A B

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 Transit

Vietnam
Import Export
Procedures Bonded
warehouse/
Procedures
Transit center
Goods
A B

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 1.4 Export and Import procedure

Settlement of Disputes
4
Performance of
the contract 3

Negotiation of a
sales contract 2
Preparation of
a transaction 1

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 1.5 Key terms

• Barter trade • Documentation

• Commodity inspection • Domestic trade
• Comparative advantage • Economics scale
• Credit reference • Entrepot trade
• Customs clearance • Export license
• Direct trade • Export procedure
• Direct transit trade • Export trade

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 Homework

• What is international trade?

• Discuss the advantages and
disadvantages of the international trade?
• Discuss in detailed of the reasons of trade,
the benefits of international trade?
•
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