国际经贸英语实务 (双语教材) Economics and Trade,主 编 周 锦 刘畅唱,高等学校应用型特色规划教材 经管双语系列,Part 1 Overview,Lead-in Background Information What Is International Trade? International trade, also known as world trade, foreign trade, overseas trade, import and export trade, is the fair and deliberate exchange of goods and services across international boundaries or territories. It concerns trade operations of both import and export and includes the purchase and sale for both visible and invisible commodities. International trade involves activities across international boundaries and territories. Domestic trade is the exchange of domestic goods and services within the boundaries of a country. The main difference is that international trade is typically more costly and complicated than domestic trade, and special problems may arise, which are not normally experienced when trading at home.,Basic Concepts in International Trade 1) Visible trade and invisible trade Visible trade refers to the exchange of physically tangible goods between countries, involving the export, import, and re-export of goods at various stages of production. It is distinguished from invisible trade, which involves the export and import of physically intangible items such as services. Basic categories of invisible trade include services (receipts and payments arising from activities such as customer service, shipping or insurance); income from foreign investment in the form of interest, profits, and dividends; private or government transfers of money from one country to another; and intellectual property and patents. 2) Import trade, export trade and entreport trade When goods or services are sold from foreign countries to the domestic consumers in a legitimate fashion, the exchange is import trade. However, when goods or services are provided to foreign consumers by domestic producers in a legitimate fashion, it is export trade. Given certain reason, the exchange of goods or services does not happen directly between the producers and consumers, but via a third party. Under this circumstance, the trading activity is called entrepot trade.,3) Value of foreign trade, balance of trade and quantum of foreign trade Value of foreign trade means the total value of imports and exports of a country at a certain period of time. It is usually expressed with a nations currency or currency for international use. The UN usually uses U.S. dollars. To have the statistics of visible commodities, value of export trade is calculated with FOB, while value of import trade with CIF. Invisible commodity is not required to declare to the custom. Therefore, theres no custom statistics. Balance of trade is the difference between the monetary value of exports and imports in an economy over a certain period of time. A favorable balance of trade is known as trade surplus (ExportsImports), or excess of export over import; an unfavorable balance of trade is known as trade deficit (ExportsImports), or excess of import over export, or informally, a trade gap. Given the fluctuation in the value of currency, monetary value of foreign trade fails to exactly express the real scale of a nations overseas trade. It also prevents the direct comparison of foreign trade at different period of time.,To avoid the influence, trade index is used. It means that the value of foreign trade is calculated using a fixed price at a certain period of time as standard price. The formula is quantum of foreign trade = volume of export and import/the fixed export and import price index. 4) Terms of trade Terms of trade, or TOT, are the relative prices of a countrys export to import. In the simplified case of two countries and two commodities, terms of trade is defined as the ratio of the price a country receives for its export commodity to the price it pays for its import commodity. Export and import price index (PX & PM) are used to calculate the ratio. Main Theories of International Trade 1) The Mercantilism Mercantilism developed at a time when the European economy was in transition. At that time, the capitalist mode of production had not been established. However, technological changes in shipping and the growth of urban centers led to a rapid increase in international trade. Of course, the introduction of double-entry bookkeeping and modern accounting as well as the discovery of America played a great role. The former made very clear the inflow and outflow of trade, thus giving the balance of trade a close scrutiny, while the latter opened new markets and propelled foreign trade.,2) The Absolute Advantage Theory The notion of division of labor across borders and free trade was first proposed by Adam Smith (1723-1790) in his representative works An Inquiry into the Nature and Cause of the Wealth of Nations, in short Wealth of Nations, in 1776. According to Adam Smith, theoretical basis of division of labor was absolute advantage or absolute cost. 3) The Comparative Cost Doctrine (the Comparative Advantage) T