When were talking about trade, you’ll probably hear the words “investments”, “portfolios”, “capital”, “debit and credit”, and BOP (thats balance of payments). These words to global trade advisors and financial aficionados are like second nature, but to those just breaking into the world of International Business, they can be daunting words. Let’s use an example that will give you a visual picture of just how everything comes together to understand how countries measure international business activity, balance payments, and look at exchange rates and altered trade prices.
At more than twenty-five percent of U.S. GDP, exports are essential to economic recovery. Export finance is a core underpinning, which makes transactions happen. However, current export lending policies and evaluations no longer suit the conditions of the global economy. Our research of export financing practices finds significant shortcomings in current lending performance. To bridge this private sector gap, the Charter of the Export-Import Bank of the United States, which provides crucial funding to exporters, needs to be re-authorized by Congress[…]
To continue reading the article, click here.
David Griffith is a chaired professor of marketing at Michigan State University. Prof. Michael R. Czinkota teaches at Georgetown University.