International Trade: Growth perspectives for China

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China, one of the largest economies in the world is also the fastest expanding market in the international trade. The GDP (Gross Domestic Product) of China is around 9 percent per year. Many of the potential and growing MNCs are heading towards China, as the business opportunities that China offers to the companies are really remarkable. China has become a successful destination for the international trade community owing of its energetic and dynamic trading economy.

The speedily rising market of China provides amazing business opportunities for foreign companies in the international trade. A number of advantages are offered by the Chinese business institutions. Firstly, China has an abundance of native raw materials. So, it has no need to depend on other countries for resources. Another advantage is the provision of low cost labor in China. The gigantic market of China that provides every possible service and product is also a big factor in the success of international trade in China.

But to be successful in the Chinese market requires a good planning, good contacts and business network. China follows a different path to do business in international trade. So, the companies are required to know the policies to run business in China. The policies, apart from other provisions, involve giving honor to seniors, staff and family.

The investor who wants to invest in Chinese market needs to be courteous while making a deal in China. To develop and execute a successful business plan, it requires a good understanding of the profits and losses associated with it. The investor also needs to maintain a good relationship with the Chinese company it is dealing with.

The international trade for China market is a network which works competently using their connections in the market. However, it is not that easy to get an entry in the business market of China. The legal and government system in China is very complicated and it involves a good amount of paperwork, which sometimes baffles the investors. The work council and labor unions in China are very influential and the laws are very strong regarding the security of the rational property.

China is the fourth biggest economic power in the world. A number of companies are looking forward to establish their business centers in China, as the growth perspective reveals high benefits in China. International trade in China is growing at a very fast speed. The reasons for China’s being so popular in international trade market are - easy availability of raw material, low cost labor and availability of all kind of products in China. But for establishing a successful business in China the investor needs a good planning and good contacts and relationship with the Chinese companies. The investor also requires a very good understanding of the legal and political system in China and also need to understand the type of paperwork involved in dealings, which can be sometimes really confusing. China is working competently in the market of international trade, using its network of connections in the market.





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China placing footsteps in international trade

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International trade was considered to be a tough task sometimes back but due the advent of technology and the booming information technology it is no longer a tough task and it is gaining momentum day by day. The trade is becoming more easy and convenient with the world becoming as small as possible like a small family. People are queuing to establish an industry in china. Every one is running to establish a share for the international trade. B2B plays an important role in the development of the international trade. It removes the barriers of the business and boosts the international trade all around the globe. It supports several other industries in the development of their products too. As for example it is a leading manufacturer of the microchips, which are used in the development of several other electronic goods, which are used and consumed everywhere.

It plays a giant role in the development of nation’s economy and is exploring its talents in the global market. When the issue comes for the international trade it is China, which comes to our mind and in the terms of exports it is china, which is on its peak. It has got a giant market in hand and its market is increasing day by day. The managers are working to still increase the trade and boost it to the fullest. China manufacturers are having a good hold in the market production and they are striving their best to bring down the cost in the market products. China goods are these days available all across the globe.

China plays a very good role in the exports and is attracting several other companies to come to china and establish their own manufacturing industries there to provide a better ground for the development of the people as well as the nation. This helps them to grow and also reduce the rates of the electronic goods so as to get better market too. It is a hub for the electronic goods industry and though other nations have tried to beat it in the trade they have never been successful in doing so. Several multinational companies are striving to have a tie up with the manufacturing companies of china to boost their trade and their business in return too.

The products developed by china are of good quality and are renowned all over the world. They are known for its better quality and cheaper rates. They got good products and excellent man-power. It is gathering better market for its products all over the globe and is constantly bringing new and innovative products in the market. Though China is a part of Asia it has got better market and better scope for the development and sales of all its products in the international market. It has stepped in the area of plastics, electronic parts, soft drink ingredients and several other goods too. The increasing exports have helped china release itself from the debt it had incurred since years and it has been able to relieve itself to great extent.





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E-Commerce: Challenges galore!

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It is true that e-commerce has changed the face of business and commercial activities such as domestic and international trade, import/export and global sourcing opportunities and the like, and has gone a long way to break barriers, yet the truth also remains that certain new barriers have raised their heads which need to be overcome as well. In this article we will take a brief look at such challenges which e-commerce presents in the current scenario and its implications to the international trade, import/export and global sourcing activities.

A survey was carried out in the UK by KPMG, a management consultancy firm which revealed that the biggest barrier which lay in the path of organisations to implement e-commerce technologies for various purposes such as international trade, import/export and global sourcing is the fact that the companies are not sure of the security aspects of the technology. It is not that sufficient standards or measures to ensure safety and security are not available; it is just that the companies are not aware or sure of the efficiency of these technologies and hence are sceptical about employing it in using them for activities like import/export, global sourcing and other forms of international trade.

Of course lots of efforts have been made by the concerned parties on such issues. One such recent example is the joining of hands by two main companies involved in online payment transactions namely MasterCard and Visa. Both these giants have jointly developed a protocol which can be used for secure transactions for purposes of international trade and making payments for import/export orders or other purposes such as global sourcing deals. This protocol goes by the name of SET which means Secure Electronic Transaction. Of course such technologies need the backing of international authorities and organisations to set up the requisite infrastructure in the required places so that in future international trade can be carried out free of barriers and without fear of import/export and global sourcing deals being intercepted by fraudsters.

Another challenge in international trade, import/export and global sourcing done via e-commerce technology is the arrangement to ensure that no concerned party denies a transaction such as receipt of order, delivery or payment and this is known as non-repudiation. This is an important aspect has work is being carried out in this direction so that the individuals and companies located far-off geographically speaking do not fear from using e-commerce technology for import/export and global sourcing activities related to international trade, but feel safe and secure about the whole process. Only then can the true value of e-commerce be realised and its potential use for international trade, import/export and global sourcing be carried out.




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E-Commerce: How different is it?

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E-commerce has been around for sufficient amount of time now and made its impact felt in the arena of international trade, import/export and global sourcing. Still if there are some of you around who aren't familiar or comfortable with the term or the technology behind it, this article is just the right choice for you to read and dispel your ignorance for ever and ever.

It was stated nearly a decade ago that the main concept of e-commerce is not about bolting technology to business, rather utilizing technology to carry out processes related to trade which includes international trade, import/export and global sourcing in a slightly different manner, as compared to traditional methods of the same.

E-commerce most covers activities related to trade including international trade, import/export and global sourcing across networks using information technology. So basically it changes both the cultural and operational aspects of carrying out domestic trade, international trade, import/export and global sourcing. Although the end results of carrying out these activities related to domestic and international trade, import/export and global sourcing still remain the same, namely to earn profits by making sure that output exceeds the input. Of course one might be tempted to say that output can never exceed the input in scientific terms and this is very true also. But when we talk in business terms we measure input in terms of tangible things such as raw material etc but intangible things like mental work, planning etc are not included hence the equation does not satisfy the normal physics laws.




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E-commerce: is every product suited for it?

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We know that e-commerce rules the roost today in the arena of international trade and its various aspects such as import/export and global sourcing. Countries such as China have taken the world by storm and literally revolutionized the pace of economic growth by opening new vistas for e-commerce and international trade which has added fuel to the fire of import/export and global sourcing deals making them the hot chase of the current times.

Although the talks about international trade and activities such as import/export and global sourcing being carried out using e-commerce technologies are in the air round the clock, have you ever bothered to stop for a while and just check whether the same is meant for all sorts of products and services? The answer to this question is not very straightforward and needs some brain tinkering which has been done below.

In the arena of e-commerce and international trade involving import/export and global sourcing of goods and services, the best or most suited products are those which are non-tangible or digital. To take an example it is very easy to transmit a file or a code across the globe via the internet or any other form of networking, but it is more difficult and cumbersome to send a pair of shoes half way across the globe without spending a lot of time and money in the process. Secondly in case of any complaint it is literally impossible to exchange the same pair of shoes by sending it back and forth which will cost time and money, whilst a file sent across the internet can be readily modified and sent back and forth as many times as required without much time or money involved in the process.

This makes digital products and services the most wanted products in the list of e-commerce items most suited for international trade, import/export and global sourcing activities. To talk even in the negative sense a customer might feel embarrassed to go across a high street shop counter and ask for any pornographic stuff, but he/she would be more comfortable in purchasing the same anonymously from the internet by paying with a credit card. Of course this is a very crude example yet it goes to demonstrate the effectiveness of e-commerce in international trade, import/export and global sourcing activities.

Thus we see how e-commerce is suitable for products which are digital in nature and non-tangible in existence because of their ease of transmission across electronic media in international trade, import/export and global sourcing.




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Business in China: Does appearance matter?

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In this article we will discuss an interesting aspect of business often not much talked about and usually remains secondary to all the technical talks of profit and loss economics. Yes, we are talking about the appearance of the person here, which includes various factors such as cloths, manners, personality and so forth. One might be tempted to ask what has that to do with the technicalities of e-commerce and international trade or business talks of import/export and global sourcing, but it must be remembered that no matter whichever technology is used the basic human element does not disappear from the perspective, and all activities associated with e-commerce, international trade, import/export or global sourcing are present for the benefit of human beings and do not exist for themselves. So wherever people are involved, their outfit and appearance also takes a prime place in the scheme of things and more so in meetings involving decisions about import/export, global sourcing or other forms of international trade either through traditional or e-commerce technology. Since our main topic of discussion is related to China and its growing volumes of international trade, import/export and global sourcing through e-commerce, it would be appropriate at this stage to take a look at some of the appearance facts that each executive involved in e-commerce, international trade, import/export or global sourcing should follow at least to some extent.

Try to wear subtle and sober colours whenever going for business meeting associated to import/export or global sourcing deals. This is the practice in China and although one might be tempted to ask that in international trade involving e-commerce, the personal touch is not of prime importance, yet it must be noted that even for activities carried out over the internet such as import/export or global souring deals, personal interaction might result at a later stage wherein e-commerce and international trade partners meet each other to discuss and review their deals and business processes.

Formal dress is literally mandatory as casual jeans/shorts etc. are not acceptable to the Chinese people whether they are dealing with local traditional trade meetings or international trade via e-commerce and other activities like import/export and global sourcing. Contrary to the western concept of openness it is considered quite indecent in China if a man touches a woman in public and should be avoided wherever in doubt. Of course the society is becoming less conservative currently in the era of e-commerce, international trade, import/export and global sourcing yet the tinge of this cultural instinct does remain deep inside China.




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International Trade with China

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Politicians have fought their way to upholding the spirit of free international trade. Multilateral agreements like WTO only try to level the playing field for international trade.

International trade with China is an old trend if you remember Marco Polo and the Silk route the Chinese had established. International trade has taken a full circle and is firmly established as an integral for both US and China. US politicians endorse the international trade with China and believe that it could benefit America. Trade with China has earned the distinction of being known as extremely lucrative of international trades.

International Trade Policy

Without going deeper, China offers an example of the collapse of the Cold War era trade preferences —a rigid and straightforward export control policy. If there are any growls today, it is that the trade policy is tilted in favor of China and that the playing field is uneven. Politicians and trade representatives from both Republicans and Democrats besides Congress are the policy makers, and since US signed the International trade relations agreement with China, it has taken care of most of the complaints. In addition to signing the normal international trade agreement US has helped China move towards personal empowerment rather than concentrate on economic agendas alone through adapting a long-run policy to normalize international trade relations. Plainly speaking, an international trade is and must be driven by market trends and demands, rather than iron frames and policies must only be made to facilitate benefits of consumers and safeguard it.

Effect of International trade with China on US

Large scale imports through international trade from China have replaced domestic production and consequently cost close to a million jobs. But in stark contrast, imports from international trade, both in, services and goods has silently contributed in terms of reduced overheads which fact is unfortunately not highlighted. On the positive side, international trade exposes domestic firms to cut-throat competition and forces companies to cut down on premiums they charged for years.

Imports from China aren’t limited to labor-intensive sectors but include high-tech sectors, like office automation, telecommunications and electrical appliances besides household machinery. Statistics prove this point; capital goods surpass import of consumer goods.

As there are voices rising in concern for the domestic players, an expert in international trade and CEO of Five Rivers, Tom Hopson told the Congress that high end electronics from China have definitely wrecked havoc in US which is a fact even ITC agreed that surge of international trade in these items from China had marred fortunes of many US companies, and went on to impose higher duties (23%).





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5 Steps to Reduce Risk in China Sourcing

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China sourcing has hit the international trade very hard. It started out as a strategy which has now become a must if a company wants to compete with its contemporaries. But many companies fail to realize the need to protect itself against the risks due to lack of planning and analysis of the market tradeoffs. When such companies are to face problems, they are left with no back up plan and ultimately get doomed. And then, the blame comes on to sourcing which is certainly not the case. Yes, the problem people face is that all the problems need to be solved under the Chinese legal system. It can get tough to do so but, since the success story of Sourcing even the Chinese legal system has become more liberal. It only requires a few basic steps to safeguard from the risks. The investment for such legalities is much less when compared to the consequences of the risks involved.

Here, are five steps which can help to reduce the risks involved in China sourcing,

Form intellectual property rights and register the intellectual property rights properly. This is because if one does not do the above, it actually fails to have a firm basis required for the IP rights. This can leave a company with nothing to protect against, when in China. This emphasizes on the need of intellectual property rights and its proper registration. Also one should protect its brand identity by forming and enrolling the slogan, trademark and logo of the brand. All of this is should be done in the home country before landing up in China.

Now register the brand in China. This gives the rights to access the Chinese markets in the future, prohibiting the export of fake goods and also impedes a competitor from registering your mark in China.

In China sourcing, if a company wishes to have confidentiality and non- competition protection then a written agreement really is a boon especially for small and medium level companies. The written agreement should preferably be in both Chinese and English.

The payment rules are very simple. Do not pay until one is very sure of the on-time delivery and the ordered product quality.

Make sure to use comprehensive agreements of OEM with each individual manufacturer. Many small and medium sized businesses do transactions via a straightforward purchase order. But this is wrong as it protects the manufacturer only. A company's protection depends on it having the written agreement of OEM. Such an agreement should be with each and every Chinese manufacturer with whom the company works. It should ideally take care of all the issues discussed above and in addition also the basic legal issues like dispute resolution and jurisdiction. Such an agreement should also be in both Chinese and English languages.

With these issues in mind, it is quite safe to plunge into the China sourcing market. These issues cover almost all the anticipated risks involved in China sourcing. So, addressing them will surely make your risk of diving into global sourcing, a successful effort and will surely make a name for your company in the international trade.





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Risk Factors in International Trade

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Managing international trade risks is harder than ever before. However, certain risk mitigation mechanisms are available to international trade which needs serious consideration.

Although process automation facilitates better managementinternational trade risks, latent risks still exist. Implementation of technologies not withstanding, international trade risks need to be managed in real time and on a totalitarian basis. The first of such risks is ramifications the slump in US economy can instill due to housing market crash. Volatility of financial markets with renewed oil market threats could trigger inflation and hikes in interest rates. The third most significant risk is the heightened scrutiny of exports due to security concerns, which makes managing international trade risks harder.
On the other hand, exporters' risks include insolvency of the importer, protracted default in which the importer fails to pay off the due within the legal period after the due date and risk of rejection. On a far sight, export ban, possibilities of war, changes to the law/tariff or even confiscation of importers' properties also count as major possible risks in an international trade.

Possible Steps to International Trade Risk Mitigation

International banks provide with expert support and service to conduct international trade and international transactions rather safely.
Getting paid in an international trade is a different thing due to a number of factors that influence it. One must note that no amount of planning can entirely eliminate the payment risks in international trade and carefully resorting to your preferred mode of payment and hedging the risks besides securing proper credit insurance and credit checks on your customers before engaging with your trading partner is the safest way out.


Regional Trade Organizations
International trade related disputes are resolved by the World Trade Organization which is a multilateral agency because it sets the rules that govern the global trading. There exist a few regional trade organizations but regulative powers are limited with them. Some quarters have raised fears that regional trade organizations can be used against them, which on the contrary has contributed to a messier situation.


Availing Credit Can Help Mitigate Some Risks
One way to safeguard international trade is via credit insurance policy with multiple covers such as the potential insolvency through which the customer provides reimbursement, although to a limit. Products like Bills for Collection (BC) and Letters of Credit (LC) come in very handy in international trade situations. An LC is a bank-to-bank commitment of payment favoring the exporter and guaranteeing the payment against presentation of certain compliant documents. Both BC and LC are governed by regulations from ICC.



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Trust is the Key to Effective Trade.

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I am glad to tell you about our success in Tootoo.com, both to offer thanks and to share our story with future business partners.We are GMGateway, Inc., located in Seoul, Korea. We mainly manufacture air conditioners and other home appliances, and we export to more than 80 countries. We have been using Tootoo.com for nearly one year and it has helped our business a lot. Last year, we upgraded to TQS membership. I suggest this membership to all Tootoo.com free members because trust is very important in the trading business. Actually, we are also using some other paid trading services, but we do not receive many inquiries through them. Tootoo.com is totally different. We get dozens of inquiries, and some of them produce good results. The bottom line is that Tootoo.com has helped us increase our sales volume.I can tell Tootoo.com is one of best partners in our business, and we hope to maintain a long-term relationship. Tootoo.com is the No.1 trading service in the world.Thank you very much, Tootoo.com!Questions and Answers 1.  Approximately, how many inquiries do you receive per month? More than 200 emails and faxes.2.  You have closed some deals. Which countries are these deals from? What are the sizes of the deals, in dollar terms? Many deals from many different countries: Germany, Netherlands, Australia, Algeria, Libya, Chile, New Zealand and Italy. Some have been for millions of dollars. 3.   How do you think Tootoo.com has helped your business most? There are other trading websites, but none have given us the positive results that Tootoo.com has.4.    What is Tootoo.com's comparative advantage compared with other trade portals?  Many more inquiries.



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