About the current situation in the economy of the Russian Federation
in January-March 2019
(in terms of foreign economic activity)
In the first quarter of 2019, average world prices for key commodities showed negative dynamics compared to the first quarter of 2018. The downward trend characteristic of prices for oil, aluminum, copper and nickel in the first quarter reflects general negative trends in the global economy: a slowdown in its growth rate, increased protectionism, and redundancy in most commodity markets.
At the same time, in March 2019, prices for oil, aluminum, copper and nickel increased slightly compared to the previous month.
The average oil price in the first quarter of 2019 was $63.2 per barrel. (average price according to Argus agency), having decreased by 2.9% compared to the first quarter of 2018.
In March 2019, compared to February 2019, the price increased by 3.2%. The key reasons for the rise in oil prices were compliance by OPEC+ countries with agreements to reduce production volumes, as well as the difficult geopolitical situation in Venezuela. Discussion of the possibility of maintaining oil production restrictions by OPEC+ countries should take place at the scheduled meeting in May 2019.
The export duty rate on oil, calculated in accordance with Decree of the Government of the Russian Federation dated March 29, 2013 No. 276 and the amendments made to it in November 2014, from April 1, 2019 amounted to 97.4 US dollars per ton, an increase of 6 .8% compared to March 2019 (USD 91.2 per ton).
Aluminum prices in the first quarter of 2019 compared to the first quarter of 2018 decreased (according to the London Metal Exchange) by 13.5% to $1,863/t, copper - by 10.5% to $6,226/t, nickel - by 6.6% to $12,412 per ton.
In March 2019, compared to February 2019, prices for aluminum increased by 0.4% to $1,871/t, copper - by 2.2% to $6,439/t, nickel - by 2.7% up to $13,026 per ton. The most important factor in rising prices for non-ferrous metals remains the possibility of reaching a trade agreement between the United States and China.
Average commodity prices in January-March 2019
| March 2019 | 1st quarter 2019 | ||||
| Price | % mm* | % y/y* | Price | % y/y* | |
| Oil - Urals, $/barrel. | 66,0 | 3,2 % | 3,7 % | 63,2 | -2,9% |
| Aluminum, $/t. | 1 871 | 0,4 % | -9,6 % | 1 863 | -13,5% |
| Nickel, $/t. | 13 026 | 2,7 % | -2,7 % | 12 412 | -6,6% |
| Copper, $/t. | 6 439 | 2,2 % | -5,3 % | 6 226 | -10,5% |
Sources: London Metal Exchange, Argus Media, World Bank.
* Legend: m/m - to the previous month; y/y - to the comparable period of last year.
Based on the results of January-February 2019 foreign trade turnover 1 amounted to 99.1 billion US dollars, nominally decreasing by 0.9% compared to January-February 2018. The negative dynamics were due to a decrease in imports by 3.5% to $32.9 billion, while exports of goods increased by 0.4% to $66.2 billion.
In the geographical structure of Russia’s foreign trade, the European Union occupies a special place (43.2% of Russian trade or 42.8 billion US dollars in January-February 2019). Trade turnover with the EU decreased by 5.4%, including exports by 2.6% and imports by 12.5 percent.
Structure of foreign trade turnover by groups of countries in January-February 2019
(January-February 2018)
(according to customs statistics, percentage)
The second group in terms of foreign trade turnover in January-February 2019 are the countries of the Asia-Pacific Economic Cooperation (31.4% of Russian foreign trade or 31.1 billion US dollars). Trade turnover with APEC countries increased by 6.6%, including exports by 9.1% and imports by 3.9 percent.
Trade turnover with the CIS countries decreased by 6.9% to $11.0 billion, including with the EAEU countries - by 10.1% to $7.6 billion.
The balance of Russia's foreign trade with all countries increased by 4.5% to $33.3 billion.
Foreign trade imbalance coefficient (ratio of balance to turnover) 2 in January-February 2019 increased to 33.6% compared to 31.9% in January-February 2018.
Based on the results of January-February 2019, a positive balance was observed in Russia’s trade with most of the most important groups of countries. At the level of individual states, Russia had a significant negative balance in trade with Vietnam (-428.5 million US dollars), Thailand (-177.0 million US dollars), Indonesia (-168.1 million US dollars ).
Export of goods at the end of January-February 2019 amounted to 66.2 billion US dollars and increased by 0.4% compared to January-February 2018.
Raw materials export in January-February 2019 increased by 1.9% to 33.1 billion US dollars compared to January-February 2018, which was due to an increase in physical volumes of coal supplies - by 11.6%, as well as average contract ( export) prices for natural gas - by 18.1 percent.
Non-resource exports in January-February 2019 amounted to 33.1 billion US dollars,
decreasing by 1.1% compared to January-February 2018. The decrease was primarily due to a decrease in the value of supplies of petroleum products - by 9.6% (due to the negative dynamics of physical export volumes and average export prices).
Non-resource non-energy exports in January-February 2019 compared to January-February 2018 increased by 3.4% to $20.6 billion. The largest increases were recorded in arms and ammunition, up $874.5 million, unprocessed aluminum, up $409.3 million, and raw and semi-processed platinum, up $317.1 million.
In January-February 2019, the positive dynamics of Russian exports at the level of the most important groups of countries was typical only for supplies to APEC countries. Russian exports to the countries of the European Union decreased by 2.6% to $31.8 billion. The most significant decrease in supplies was to Poland (-31.3%) - as a result of a decrease in exports of crude oil and natural gas, Finland (-27.4%) - crude oil and steel pipes with a diameter of more than 406.4 mm, Great Britain (-26. 7%) - crude oil and coal, Germany (-9.0%) - crude oil and natural gas. At the same time, supplies to Austria (2.3 times growth) and the Netherlands (+15.2%) increased sharply due to an increase in natural gas exports.
Exports to APEC countries increased in January-February 2019 compared to January-February 2018 by 9.1%, including to the Republic of Korea (+57.9%) - due to increased supplies of crude oil, coal and natural gas, USA (+18.0%) - crude oil, China (+3.3%) - petroleum products and frozen fish.
The decrease in Russian exports to the CIS countries in January-February 2019 amounted to -7.3% (to 7.4 billion US dollars), including to Kazakhstan -15.4%, to Belarus -10.1 percent. The decrease in Russian exports in January-February 2019 to Belarus was due to a decrease in supplies (in value terms) of non-irradiated petroleum products and fuel elements (fuel elements), and to Kazakhstan - petroleum products and surfactants.
Fuel and energy products continue to dominate the commodity structure of exports; their share in January-February 2019 decreased compared to January-February 2018 by 0.4 percentage points to 66.1%. The value of exports of fuel and energy goods decreased by 0.1% to $43.8 billion. Exports of crude oil decreased by 7.3% to 18.1 billion US dollars, petroleum products decreased by 9.6% to 11.4 billion US dollars, natural gas (in gaseous state) increased by 14.9 % to 9.2 billion US dollars.
The basis of Russian exports, in addition to fuel and energy goods, are metals and products made from them, chemical products and rubber; these three groups in January-February 2019 accounted for a total of 81.7% of the value of Russian exports. The largest growth (by value) was observed in potash fertilizers (+85.7%), raw aluminum (+49.7%), sponge iron (+38.7%), nitrogen fertilizers (+22.6%), mixed fertilizers (+18.5 percent).
Value of Russian imports at the end of January-February 2019 showed negative dynamics and amounted to 32.9 billion US dollars, which is 3.5% lower than in January-February 2018. The strongest growth was observed in the import of certain types of mechanical and technical products, in particular, industrial equipment, electric telephones, airplanes and helicopters, as well as medicines packaged for retail sale.
Imports of consumer goods in January-February 2019 decreased compared to January-February 2018 by $90.1 million (or -0.9%) to $9,622.0 million.
Imports of “sanctioned” goods in January-February 2019 compared to January-February of the previous year decreased by 2.2% to $2,175.7 million.
At the end of January-February 2019, compared to January-February 2018, Russia’s imports from EU countries decreased by 12.5%, from CIS countries - by 6.0 percent. Russia's imports from APEC countries increased by 3.9 percent.
The main item of Russian imports remains machinery, equipment and vehicles, purchases of which in January-February 2019 compared to January-February 2018 decreased by 4.8% to $14.4 billion, the share of this product group in the structure of domestic imports amounted to 43.7 percent. Including imports of industrial and laboratory equipment decreased by 55.7%, helicopters and airplanes - by 30.2%, electric telephone and telegraph equipment - by 14.0%, computers and their units - by 10.9 percent. At the same time, significant growth was demonstrated by the import of passenger and cargo ships - 14 times, air conditioners - by 50.8%, car bodies - by 38.9%, fittings for pipelines and boilers - by 23.2 percent.
In addition to machinery, equipment and vehicles, the basis of Russian imports are chemical products and rubber, food products and agricultural raw materials; the share of these three product groups in January-February 2019 in the structure of Russian purchases amounted to 77.0 percent.
In value terms, imports of food products decreased by 2.0%, chemical products - by 1.6%, including imports of reaction catalysts decreased by 44.9%, corn - by 36.6%, insecticides and herbicides - by 29. 9%, frozen fish - by 22.5%, medicines packaged for retail sale - by 11.1 percent.
Far abroad countries are Russia's main trading partners. At the end of January-February 2019, their share in trade turnover was 88.9%, in exports - 88.8%, in imports - 89.0 percent.
Main trading partners among non-CIS countries
in January-February 2019 (billion US dollars)
Russia's foreign trade turnover with non-CIS countries in January-February 2019 amounted to $88.0 billion and nominally decreased by 0.1 percent compared to January-February 2018. Exports increased by 1.4 % to 58.8 billion US dollars, imports decreased by 3.2% to 29.2 billion US dollars.
The leading positions among the EU member countries are occupied by Germany, the Netherlands (largely due to large volumes of re-export of Russian hydrocarbons) and Italy, with a share of which account for 46.3% of foreign trade turnover with this group of countries.
The most important foreign trade partners among APEC countries are China, the USA, Japan and the Republic of Korea, which accounted for 85.6% of foreign trade turnover with this group of countries in January-February 2019.
Based on the results of January-February 2019, China is Russia’s largest foreign trade partner (16.6% of Russia’s trade turnover or $16.5 billion). Russian exports to China amounted to $8.4 billion, an increase of 3.3% compared to January-February 2018.
The share of Russia's other largest partners in January-February 2019 was 8.2% for the Netherlands, 8.1% for Germany, 4.1% for the Republic of Korea, 3.9% for Turkey.
Foreign trade turnover of Russia with CIS countries at the end of January-February 2019 decreased by 6.9% to 11.0 billion US dollars. Russia's exports to the CIS countries decreased by 7.3% to $7.4 billion, and Russia's imports from the CIS countries decreased by 6.0% to $3.6 billion. There was a trade surplus with all CIS countries in January-February 2019.
2 Shows the degree of balance between export and import operations. Ratio varies
from -100% to +100%, while a balanced situation is when the coefficient is equal to zero (revenue from export transactions fully covers the costs of import operations), and an unbalanced situation -100% or +100% (complete one-sidedness of trade relations: at -100% completely import-dependent economy, at +100% completely export-oriented economy)
RUSSIAN NEW UNIVERSITY
(RosNOU)
FACULTY: Economics, Management and Finance
Abstract.
By discipline: "International relationships".
On this topic: "Russian foreign trade: structure and directions."
Completed by: 3rd year student by correspondence
Naumov's forms of education. O.V.
Accepted by: scientific supervisor
Gureeva.M.A.
Moscow 2010
Introduction
1.1 Foreign trade and its basic concepts
1.2 Purpose, principles and priorities of Russian foreign economic activity
1.3 Development of institutions for supporting foreign economic policy
Chapter 2. State and prospects of Russian foreign trade
2.1 Export and import of Russia
2.2 Prospects for Russian foreign trade
Conclusion
Bibliography
Introduction
For centuries, foreign trade has been and is the basis of international economic relations, since the growth of world economic relations has accelerated the process of formation of the international division of labor, which connects all countries into a single economic whole. And Russia is an active participant in international trade.
Russia's main advantages continue to be its large market size and relative macroeconomic stability. But at present, Russia's competitiveness is at a level unworthy for such a country. The World Economic Forum published competitiveness ratings of 133 countries for 2009–2010. According to the Global Competitiveness Report, Russia fell from 51st to 63rd place, falling below countries such as Montenegro, Turkey, Mexico, Panama and Mauritius.
At present, trade and economic ties have largely retained their previous features. This primarily relates to the structure of trade turnover, which has not changed that much. The basis of commodity exchange operations was fuel and energy goods, ferrous and non-ferrous metals, fertilizers, and engineering products.
The chosen topic is extremely relevant, since the sphere of foreign trade provides enormous opportunities for the formation and development of the economy, the formation of the country’s budget, and maintaining the well-being of the people. Also, through foreign trade, there is a redistribution of material goods at the interstate level, thereby contributing to the development of commodity-money relations in the country under the influence of increased contacts with the foreign market.
Chapter 1. Theory of export-import operations
1.1 Foreign trade and its basic concepts
International (foreign trade) - trade with other countries, export of goods from the country and import of goods into the country. This is an ancient and traditional form of international economic relations. According to historical research, foreign trade is older than crafts and agriculture. Unlike domestic trade, foreign trade ensures the movement of goods between states, which inevitably gives rise to certain contradictions and problems arising from long distances and the time factor, differences in traditions, national money, etc.
The role of foreign trade in international economic relations has constantly increased. The growth of foreign trade was not uniform, but this did not change the general trend of its development. Many economists establish a cause-and-effect relationship between the growth of foreign trade and the growth of world production and wealth. Although this point of view is not indisputable. But relatively recently, the World Bank conducted a study of the economic growth of 40 developing countries, which were grouped by trade orientation. The results of the study confirmed the above-mentioned cause-and-effect relationship.
In general, for the period from the end of the 19th to the beginning of the 20th century. world trade developed at a fairly rapid pace - an average of 3.5% per year.
The development of foreign trade was suspended by the First World War. After the war, growth resumed, but was then interrupted by the Great Depression and World War II.
After the Second World War, foreign trade resumed and began to expand extremely rapidly. From 1947 to 1973 The volume of world exports increased annually by 6%. In the early 80s, there was some stagnation in the development of foreign trade, caused by the “oil shock”. Since 1984, the rise in foreign trade resumed and by 1990 the growth rate of world exports reached 7% per year. In general, over the past 50 years there has been a sharp, “explosive growth” in the export of goods.
If we compare the average annual growth rates of world production and world exports of goods over the past 50 years, then the growth rate of exports is 1.5 times higher than the growth rate of production. Thus, the foreign trade orientation of the world economy has increased significantly. Today, the share of imports in the total supply of finished goods on the markets has increased 3 times compared to 1950 and reached more than 20% in the USA, 30% in Germany, 30% in the UK, and more than 60% in Norway. Currently, the economy of any country in the world, if it does not pursue a policy of artificial isolation from the world market (policy of autarky), depends on participation in foreign trade.
Foreign trade is assessed using the basic concepts of exports, imports and foreign trade turnover. Export– export of goods from the country for sale or use in other countries. The economic efficiency of exports is determined by the fact that the country exports those products whose production costs are lower than world prices. The size of the winnings depends on the ratio of national and world prices of a given product. Import– import of foreign goods into the country from abroad. When importing, a country purchases goods that are currently economically profitable to produce. When calculating the efficiency of foreign trade, the economic gain that a given country receives due to the rapid satisfaction of its needs for goods through imports and the release of resources spent on the production of similar goods in the country is calculated.
The total amount of exports and imports is foreign trade turnover with foreign countries.
It should be remembered that the country’s foreign trade turnover is calculated in monetary units, since it includes heterogeneous goods that are not comparable in physical terms. For individual goods, exports and imports can be measured in natural units (pieces, tons, meters).
The balance of foreign trade can be positive or negative, and rarely goes to zero. Accordingly, we can talk about a positive or negative trade balance of the country. A negative trade balance means the occurrence of a passive trade balance. Conversely, a positive balance characterizes a country's active trade balance.
Foreign trade promotes more efficient use of both domestic resources and resources belonging to other countries, in order to more fully satisfy the unlimited needs of the population within the country abroad. Moreover, changes in net exports (the difference between exports and imports) can have a significant impact on domestic production and income levels. In the modern world economy, international trade remains of utmost importance in its scope and functions. Its main functions are:
Determining the volume and structure of world production
*development of the international division of labor
Mediation in various types of international cooperation (joint production activities of market entities in different countries, international technology exchange, etc.).
1.2 Purpose, principles and priorities of Russian foreign economic activity
The goal of foreign economic policy is to create conditions for Russia to achieve a leading position in the global economy based on effective participation in the global division of labor and increasing the global competitiveness of its national economy.
Achieving this goal involves:
Specialization of the Russian economy in the production of high-tech products and highly processed goods, as well as in the provision of intellectual services;
Strengthening Russia's position in the world market as an exporter of agricultural products, reducing dependence on imports of agricultural products and food;
Ensuring the global competitiveness of manufacturing industries using instruments of customs and tariff policy, regulation of domestic markets, attracting foreign capital and the formation of competence centers in industries built into global value-added production chains;
Achieving a leading position in the supply of energy resources to world markets based on geographic and product diversification of exports, participation in the formation of global energy infrastructure and the development of rules for the functioning of global energy markets;
Realization of competitive advantages in the field of transport, agriculture and raw materials processing;
Strengthening Russia's role in solving global problems and shaping the world economic order;
Geographical diversification of foreign economic relations, ensuring the consolidation of the positions of Russian exporters and investors in traditional markets and the development of new markets;
Creation of a Eurasian economic space with an integration core - EurAsEC, as well as ensuring favorable conditions for establishing border and interregional cooperation with the participation of constituent entities of the Russian Federation;
Building stable, diversified connections with world economic centers that increase the long-term sustainability of the development of the Russian economy;
Strengthening trade and economic relations with China, India, Brazil, Mexico, South Africa, Egypt, Saudi Arabia, South Korea, Turkey, ASEAN countries and other countries in the Asia-Pacific region, the Near and Middle East, Africa and Latin America;
Increasing the effectiveness of assistance to Russian companies and investors abroad, improving the international legal framework in foreign economic and foreign trade spheres, including in order to reduce technical barriers to trade.
The main target indicators (by year) are given in table1.
Table 1. Main target indicators of foreign economic policy until 2020 (billion US dollars)
|
2010 forecast |
2015 forecast |
2020 forecast |
||
|
Export of goods, total |
||||
|
export of fuel and energy goods |
||||
|
export of machinery and equipment |
||||
|
Import of goods, total |
||||
|
Export of transport services |
Foreign trade is characterized by the concepts of export and import: the first involves the export of goods and services abroad and receiving foreign currency in return, and the second involves their import from abroad with the appropriate payment. Exports, like investments, increase aggregate demand in the country and drive the foreign trade multiplier, creating primary, secondary, tertiary, etc. employment. An increase in imports limits the effect of this effect due to the outflow of financial resources abroad.
Profitability of foreign trade. The theory of comparative advantage. Export in foreign trade, according to A. Smith, becomes profitable if the costs of producing goods within the country are significantly lower than in other countries. In this case, the goods produced by the national economy have absolute advantages over foreign competitors and can be easily sold abroad. On the other hand, no state can have an absolute advantage in all produced goods; therefore, it is necessary to import those that are more expensive within the country and cheaper abroad. Then, at the same time, there is direct benefit from both exports and imports.
Based on the absolute advantages of A. Smith, D. Ricardo formulated the theory of comparative costs (advantages), according to which, when determining the profitability of foreign trade, one should compare not the absolute, but the relative effect, and not the costs themselves, but their ratios. At the same time, it must be taken into account that by producing certain goods in conditions of limited resources, the country is deprived of the opportunity to produce others that are no less necessary for it, therefore, in accordance with the theory of comparative advantage of D. Ricardo, a situation is quite possible in which it is profitable for the country to import goods, even if their production within the country is cheaper. In this case, A. Smith's theory of absolute costs becomes a special case of the theory of comparative costs.
The theory of comparative costs of D. Ricardo in modern conditions is supplemented by the Heckscher-Ohlin theory, named after two Swedish economists who proved that countries strive to export not only those goods that have absolute and relative advantages, but also in the production of which relatively surplus production factors are intensively used , but import goods for the production of which there is a shortage of factors in the country. Unlike A. Smith and D. Ricardo, their modern followers believe that both sides benefit from foreign trade - both the country and the rest of the world.
Foreign trade is the trade relations of a given country with other countries, which include both the import, or import, of goods, and their export, or export. The totality of foreign trade relations between different countries forms international trade. Within the framework of this trade, over time, an international division of labor was formed, which underlies international trade relations. Foreign trade arose back in the days of subsistence production, and developed rapidly in the pre-capitalist era, entering new forms with the advent of capitalist relations.
Foreign trade of the country
Foreign trade is the exchange of a country with other countries, including paid exports and imports of goods and services. The term "foreign trade" is applicable only to a single country.To characterize both international and foreign trade, indicators of general trade turnover, commodity and geographical structure are used.
Foreign trade turnover is the sum of the value of exports and imports of a particular country.
The value of foreign trade is calculated for a certain period of time in current prices of the corresponding years using current exchange rates.
The physical volume of foreign trade is calculated in constant prices and allows making the necessary comparisons and determining its real dynamics.
The commodity structure of world trade represents the ratio of commodity groups in world exports.
Geographic structure - the distribution of trade flows between individual countries and their groups, distinguished either by territorial or organizational characteristics. Organizational geographical structure - data on international trade between countries belonging to individual integration and other trade and political groupings, or allocated to a certain group according to certain criteria. The main forms of international trade are the export and import of goods.
Indicators reflecting a country's participation in international trade are export and import quotas. The export quota is calculated as the ratio of exports of goods and services to GDP and shows what share of all products produced in the country is sold on the world market. The import quota is calculated as the ratio of imports to the volume of domestic consumption of the country, which includes the totality of national production and import stocks, and shows the share of imported goods and services in domestic consumption.
International trade consists of two counter flows of goods - exports and imports and is characterized by a trade balance and trade turnover.
Trade balance is the difference between the value volumes of exports and imports. Trade turnover is the sum of the value of exports and imports.
The subjects of international trade are all states of the world, transnational corporations and regional integration groups. The objects of international trade are the products of human labor - goods and services.
Considering that the objects of international trade are goods and services, there are two forms of trade: international trade in goods and international trade in services. International trade in goods is a form of communication between producers of different countries, arising on the basis of the international division of labor and expressing their mutual economic dependence.
In international practice of statistical accounting of exports and imports, the date of registration is the moment of goods crossing the customs border of the country. The cost of exports and imports is calculated in most countries at contract prices reduced to a single basis, namely: exports - at FOB prices, imports - at CIF prices.
The statistical assessment of goods on FOB (free on board) terms includes, in addition to the cost of the goods themselves, all costs associated with its delivery to the ship, including loading on board. For land transportation, the “fob” price means the price of the goods on the terms “free-land border of the exporting country”, which, in addition to the cost of the goods itself, also includes the costs of delivering it to the border of the exporting country. The CIF price (cif - cost, insurance, freight - cost, insurance, freight) includes the cost of the goods on FOB terms - port of departure plus the costs of insuring the goods en route and its transportation (sea freight) to the port of destination. For land transportation, the concept of “cif price” corresponds to the “ex-border – border of the importing country” price.
The cost of world imports is always higher than the cost of exports by the amount of freight and insurance costs, because world exports are valued on the basis of the FOB price, and imports on the basis of the CIF price.
Accounting for counterparty countries, that is, countries between which foreign trade is carried out, is carried out using the “production – consumption” method. In accordance with this method, imports are reflected by the country of production (origin of the product), and exports - by the country of consumption of the product.
The UN Statistical Commission recommends taking into account in exports and imports all goods and material assets that, as a result of their export or import, reduce or increase the material resources of the country. Thus, exports and imports also include goods whose import and export were carried out on a non-commercial basis, that is, in the form of gratuitous assistance or in the form of gifts.
The volume of global trade turnover does not include the cost of all types of services, including those of a material nature (construction and installation work, design, survey work, patents, licenses, printing of books, advertising materials).
The development of international trade has received a powerful impetus under the influence of the processes of globalization of the world economy, liberalization in the trade and political sphere, the expansion of preferential trade within regional economic associations, the deepening of international production and scientific and technical cooperation, the rapid growth of sales of progressive high-tech products, primarily office and telecommunications equipment incorporating the latest achievements of scientific and technological progress.
The main and urgent task for enterprises of the Republic of Belarus at present is the formation of their TPS abroad. This will increase the efficiency of promoting goods to consumers, optimize costs for promoting their own products, achieve stability, reliability and competitiveness in foreign markets, as well as basic positions in the further development and expansion of the market.
The formation of a commodity distribution system and distribution network depends on a number of factors:
The nature and capabilities of the enterprise;
- the nature, volume and range of products;
- characteristics of the market (economic, legal, scientific and technical, cultural and demographic, geographical, etc.).
Marketing activities are related to and directed towards the market.
In this regard, the processes occurring in the market, its changes and dynamics cannot but influence the activities of producers. That is why international marketing activities involve studying, analyzing and taking into account the market situation, as well as active, targeted influence on foreign markets.
The process of developing and implementing methods for consistently developing and retaining foreign markets includes:
Initial study of the features of international markets, characteristics of the world market with mandatory consideration of trends in their changes;
- creation of an information database of economic, political, legal, scientific and technical characteristics that determine the processes and situation in international markets;
- analysis of the international business environment in specific foreign markets;
- setting goals for actions in foreign markets;
- selection of foreign markets based on selection and ranking, acceptable for further activities, and studying the characteristics of the selected markets;
- determining the method of market development (market penetration): export, joint activities, investment;
- development of private marketing mix strategies (product, pricing, communication, distribution) for work in foreign markets;
- creation of services for organizing and managing international business.
As foreign economic activity develops, this process becomes more complex in accordance with changing goals and objectives.
In addition, there are a number of features that must be taken into account, namely:
The dynamism and variability of the business environment in foreign markets;
- difficulty in obtaining information necessary to carry out activities in foreign markets;
- the need for systematic and active, rather than episodic, processing of markets at various stages of product promotion;
- the need to take into account the characteristics of international cooperation and foreign business partners;
- the presence of higher risks of activity in foreign markets;
- complication of organizational forms and management aspects of activities.
General marketing functions have universal application in both domestic and foreign markets. However, significant differences in the marketing environment of domestic and foreign markets should be taken into account.
An enterprise is a complex self-organizing, self-regulating system that interacts in the external environment both vertically and horizontally. The marketing environment is a set of entities operating outside the company, organizational structures, forces and conditions in which the marketing activities of an enterprise are carried out. The macro environment of marketing is a set of conditions that actively influence the activities of the company. These are common external factors - economic, political and legal, scientific and technological, natural and climatic, geodemographic, cultural.
The marketing microenvironment is the conditions that ensure the life of the company. The marketing microenvironment is formed by factors closely related to the company, directly interacting with it and affecting its relationships with clients. These include: the company itself, its clients and contact audience (society), suppliers, intermediaries, competitors.
At the same time, it is necessary to take into account that within the marketing system there is pressure on the company from elements of micromarketing, that is, from consumers who have market power; suppliers providing the company with the necessary raw materials and materials; intermediaries providing communication between the company and the target consumer market; and, of course, from competitors.
Competition within the microenvironment increases due to the influence that suppliers and intermediaries have on the company. Thus, suppliers may withdraw from partnerships, increase prices, or go out of business. Competitors, in turn, can intensify their methods of competition and switch to the production of a substitute (substitute product) product. Buyers - to prefer goods from other companies, to change quantitatively and qualitatively.
The study of the system of five components of the marketing environment, which is based on a certain degree of dependence of the company on the elements of the microenvironment and its superiority over them, is a tool for developing marketing strategies that allow the company to achieve a sustainable competitive position in the market.
In this regard, it is necessary to investigate:
Quantitative and qualitative characteristics of the target consumer (cultural characteristics and values, attitude towards the product, price, etc.);
- quantitative and qualitative characteristics of suppliers;
- features of TPS and intermediaries;
- quantitative and qualitative characteristics of competitors and the level of competition.
In other words, it is necessary to influence the microenvironment, changing and adapting it to the dynamics of the macroenvironment.
The active or passive position of perception of the marketing environment is determined by the goals and capabilities of the company, that is, the rationality of its activities. Passive perception of the marketing environment involves analyzing the forces operating in it and developing measures to avoid environmental threats or take advantage of its favorable opportunities, that is, to adapt to it; does not involve attempts to change the environment. Active perception of the marketing environment involves managing the environment through active actions influencing the consumer society and factors of the marketing environment; to a lesser extent or not at all involves simple observation and adaptation to changes that occur.
Thus, the international marketing environment in which enterprises producing and selling goods and services operate is becoming more complex. Firms succeed as long as they and their products, as well as the way they market them, fit this environment.
Marketing influence is possible only on the basis of comprehensive targeted monitoring, that is, collection, systematization and analysis of information. In this regard, there is a need to actively use SWOT analysis - to identify and divide the key factors influencing the strategic development of a company or industry into external and internal, positive and negative.
Internal factors (competitors, suppliers, intermediaries, clients and contact audiences) and external (economic, political and legal, scientific and technical, natural geographical, cultural and demographic) can have both positive and negative impact on the activities of the company, that is create opportunities or pose threats. At the same time, systematizing internal and external factors, it is necessary to develop the strengths in the enterprise’s activities and compensate for the weaknesses, take advantage of opportunities and avoid threats. That is why the goals of SWOT analysis are an integrated assessment and forecasting of the performance of a company or industry; development of a balanced strategy. As a rule, the results of a SWOT analysis are presented in tabular form.
Based on the results of the SWOT analysis, situations are predicted and a management solution is developed to prevent or overcome threats and mitigate risks in the company's activities. For example, at present this type of analysis is actively used by the marketing services of such enterprises as MTZ, MAZ, Milavitsa, Belaruskali, etc. The decisive role in monitoring markets should belong to the National Center for Marketing and Price Research, which is under the patronage of the Ministry of Foreign Affairs of the Republic of Belarus . It is this organization that should accumulate information and help domestic producers monitor markets.
The most significant, from the point of view of using the marketing mix, are the following goals of the enterprise: analysis of the sales structure, analysis of cost coverage, profit and cost savings, enterprise growth, and so on. Products and programs can be evaluated based on various criteria. The most commonly used indicators in this role are sales volume and cost coverage. Analysis of the sales structure shows, first of all, the absolute and relative values of products and product groups and deviations from planned values and indicators for the past period of time. The results of a sales assessment provide information about a product that should be excluded from the production program, since this reduces the level of marketing, and, consequently, the economic potential of the enterprise as a whole. For this purpose, a concentration analysis is carried out, a variant of which can be the so-called ABC analysis. According to it, the products of the enterprise under study are divided into three classes according to selected criteria (for example, sales, cost coverage, profit, as well as all manufactured goods) and are distributed according to the share of each type of product in the total sales volume of the enterprise. The goods distributed in this way conditionally form three groups: A - group of the highest priority goods; B is a group of transitional products and C is the main candidates for elimination from the enterprise’s production program.
In essence, ABC analysis is the ranking of an assortment according to various parameters. In this way, you can rank suppliers, warehouse stocks, buyers, and long periods of sales - everything that has a sufficient amount of statistical data. The result of ABC analysis is the grouping of objects according to the degree of influence on the overall result.
ABC analysis is based on the principle of imbalance, during which a graph is constructed of the dependence of the cumulative effect on the number of elements. This graph is called a Pareto curve, Lorenz curve or ABC curve. Based on the results of the analysis, assortment items are ranked and grouped depending on the size of their contribution to the total effect.
Conclusions: in modern conditions, the active participation of a country in world trade is associated with significant advantages: it allows for more efficient use of the resources available in the country, to join the world achievements of science and technology, to carry out a structural restructuring of its economy in a shorter period of time, as well as to more fully and diversely satisfy needs of the population.
The main goal of monitoring the operating environment in foreign markets is to develop a management decision that ensures the achievement of a sustainable competitive position for domestic producers in foreign markets when creating and actively using TPS.
Regulation of foreign trade
A practical tool for the policy of protectionism is customs regulation of foreign trade. There are two main groups of protectionism methods: customs-tariff and non-tariff. Customs tariff methods involve the establishment and collection of various customs duties for foreign trade activities. Non-tariff methods, of which there are up to 50, are associated with the establishment of various bans, quotas, licenses and restrictions in the field of foreign trade activities. In fact, the foreign trade policy of any country is based on a combination of these two groups of methods.The most common and traditional method of customs tariff regulation of foreign trade is customs duty.
Customs duty is an indirect tax that is levied on goods imported or exported from the customs territory, and which cannot vary depending on two factors: the general level of taxation and the cost of services provided by customs.
Since customs duty is an indirect tax, it affects the price of the product. In customs practice, only movable tangible property is called goods.
A customs territory is a territory in which control over exports and imports is carried out by a single customs agency. The boundaries of the customs territory may not coincide with the border of the state. For example, with customs unions of several states. Or when, due to geographical conditions, the establishment of customs control is not possible or convenient. The boundaries of the customs territory are established by the government of each country.
Customs duty has two essential features. Firstly, it can only be seized by the state. And therefore it goes to the state (federal), and not the local budget. Secondly, import duty applies to goods of foreign origin. And the export duty (albeit an atypical type of duty) applies to domestically produced goods. In this regard, an important problem in customs practice is the correct and accurate determination of the country of origin of the goods.
The product code is determined according to the globally accepted harmonized system of description and coding of goods (HS).
According to the method of calculating duties, there may be:
1) ad valorem;
2) specific;
3) combined.
Ad valorem duties are set as a percentage of the customs value of the goods. Specific - depending on the units of measurement of goods (per 1 ton, per 1 piece, per 1 cm3, etc.). Combined combines ad valorem and specific calculation methods. Customs duty rates are associated with various foreign trade regimes. A minimum rate (called the reference rate) is set on goods originating from countries with which there is a most favored nation (MFN) trade agreement. The maximum is for countries with which there is no MFN agreement. The preferential or preferential rate is the lowest and is established on goods originating from a number of developing countries. In addition, according to global foreign trade rules, there is a group of poor countries whose agricultural products and raw materials are not subject to customs duties at all.
The higher the tariff level, the more reliably it protects national firms. But in order to understand who is personally protected by the tariff, it is necessary to consider the structure of production.
A tariff on a product of any industry is protection, but only in relation to the company producing it in the country. It also protects the income of workers and employees employed in these firms and creating “added value”. In addition, the tariff protects the income of industries that supply raw materials to the industry.
Thus, a tariff on a product (for example, refrigerators) supports not only the firms that produce them, but also the workers of the firms and suppliers of parts. This complicates the task of measuring the impact of a tariff on the firms producing the good. The position of firms producing goods is also affected by tariffs on imported goods that represent cost elements for them (firms), for example, imported components.
Therefore, a complete model of the interaction of supply and demand is required, simultaneously covering several industry markets. To simplify the model, another measurement method is used. This method quantifies the impact of the entire tariff system on the value added per unit of output produced by a given industry. At the same time, the production of the industry and related industries, as well as prices, do not change.
Thus, the actual level of the protective tariff (the effectiv rate of protection) in a particular industry is determined as the amount (in %) by which the added value per unit of product created in this industry increases as a result of the functioning of the entire tariff system.
The actual level of the protective tariff in a particular industry may differ significantly from the tariff paid by the consumer of the “nominal level of the protective tariff”.
The effective customs duty rate characterizes two basic principles that underlie the overall effect of protectionism:
Industry income or added value will be affected by trade barriers, not only those erected on the way to imports, but also those operating in the market for raw materials and inputs of the industry;
Moreover, if the final products of an industry are protected by a higher tariff than its intermediate products, the actual protective tariff will exceed its nominal level.
After World War II, the role of non-tariff methods began to increase. This is due to several reasons.
Firstly, since the 50s. As a result of multilateral negotiations, it was possible to significantly reduce the world average level of customs duties. And the expansion of non-tariff methods was partly a response to this decline. Secondly, increased competition in world markets has forced many countries to take measures to protect domestic producers. Third, the sharp increase in imports in many countries increased the trade balance, which seriously worsened the financial position of these countries. Fourth, the aggravation of the unemployment problem has also contributed to the strengthening of non-tariff methods to prevent the closure of domestic enterprises under the blows of foreign competitors.
Non-tariff regulation measures are very diverse. Some of them can be attributed to the legitimate functions of the state, for example, import quotas. Others are aimed at discriminating against foreign trading partners. For example, Colombia forced steel importers to buy a certain amount of more expensive domestic steel for each ton of imported products.
The most common type of non-tariff barriers are import quotas. An import quota is the amount of a foreign good that can be imported into a country within a certain period of time. For example, the import quota for Japanese cars in the United States is 2.3 million units per year. In addition, in the United States there are import quotas for meat and dairy products and tobacco.
What are the reasons for using quotas? First, a quota allows you to fix import costs. This is especially important when there is fierce foreign competition and a passive trade balance. Secondly, quotas enable the government to pursue a more flexible foreign trade policy. Since international trade agreements do not allow higher tariffs, it is easier to set stricter import quotas.
The impact of quotas on the domestic market depends on the level of demand and production volume of domestic producers. If quotas do not cover the total demand in the domestic market, then they not only reduce imports, but also lead to an increase in domestic prices compared to world prices.
In addition to quotas, special barriers are currently quite widely used: strict requirements for the technical safety of goods, sanitary and environmental standards, requirements for containers and packaging. Today, about 27% of all imports of industrialized capitalist countries are subject to non-tariff barriers, and 42% of imports in the United States.
Export stimulation occupies a special place in the system of protectionist measures. This is due to the increasing dependence of the country's economic growth on participation in international trade. Export growth characterizes the country's economic progress and helps improve the standard of living of the population. The accumulation of foreign exchange reserves creates conditions for the implementation of various economic development programs.
To stimulate exports, the most common policy used is subsidies. Export subsidies allow firms to reduce the cost of exports and strengthen their positions in the markets of other countries. The state also makes expenses to stimulate the sale of export goods by organizing advertising and providing other marketing services. The tax system may also provide for the establishment of tax benefits for exporters depending on the volume of exports. On average, export subsidies are small, but for individual products and firms they can be significant. In general, export subsidies in the manufacturing industry of developed countries do not exceed 1% of the value of exports. Agriculture receives the largest percentage of subsidies. Leading capitalist countries conduct government programs to support farmers' incomes through guaranteed purchases of surplus agricultural products. They also pay bonuses for refusing to sow certain areas. In particular, the countries of the European Community, in order to reduce budgetary costs to support farmers, sold excess products at a loss to themselves at reduced prices to the Soviet Union.
In addition to subsidies, dumping is one of the methods of foreign trade policy. Dumping is international price discrimination. In this situation, the exporting firm sells its goods in one foreign market cheaper than in another. Predutory dumping is the temporary establishment of low prices aimed at ousting a competitor from a given market, followed by restoration of the price level. Persistent dumping continues indefinitely.
Foreign trade in goods
Foreign trade is the international exchange of goods, works, services, information, results of intellectual activity, including exclusive rights to them (intellectual property). According to Russian legislation, a commodity is any movable property (including all types of energy) and aircraft, sea vessels, inland navigation vessels, and space objects classified as real estate that are the subject of foreign trade activities.Exclusive rights to the results of intellectual activity (intellectual property) include:
Exclusive rights to literary, artistic and scientific works, programs for electronic computers and databases;
related rights: for inventions, industrial designs, utility models, as well as means of individualization of a legal entity equated to the results of intellectual activity (trade names, trademarks, service marks) and other results of intellectual activity and means of individualization, the protection of which is provided for by law.
Unlike goods, services in most cases do not take a material form. The only exceptions are certain types of services, such as computer software products, various documentation, etc.
Foreign trade in goods is divided into various groups depending on the subject of foreign trade and the nature of foreign trade operations:
1. Trade in fuel, raw materials and agricultural goods.
Raw materials are understood as a complex that combines materials directly extracted from the environment (oil, ores, timber, etc.) and semi-finished products, that is, materials that have been processed, but are not consumed as finished products, but act, in turn, raw materials for the production of finished products (metals, chemicals, etc.). All diverse types of raw materials are divided into two large groups: industrial and agricultural.
Depending on the forms of international trade, raw materials are divided into exchange goods (cereals, sugar, natural rubber, cotton, certain types of non-ferrous metals) and non-exchange goods (oil, natural gas, coal, ores of ferrous and non-ferrous metals, timber, pulp and paper and other goods ). Transactions for goods of the first group are concluded on the corresponding commodity exchanges, and the sale of goods of the second group is carried out under short- and long-term contracts.
2. Trade in machinery and equipment.
Machinery and equipment in foreign trade practice are sold and purchased in the form of ready-to-use products (cars, machine tools, etc.): disassembled for subsequent assembly in the buyer country: in the form of units, parts and individual parts within the framework of cooperation agreements or as spare parts for maintenance and repair of previously supplied equipment in the form of complete objects (workshops and sections of industrial enterprises, complete enterprises, power plants, etc.).
Each of these types of supplies has its own characteristics:
Trade in finished products intended and suitable for direct final consumption is the most common type of supply of various types of vehicles, general engineering products, technical goods for cultural and household purposes. Its peculiarity is that the product is transferred to the buyer in a form ready for use. Delivery is carried out directly by the manufacturer or through intermediaries of various kinds in world or contract yen. The seller company provides pre-sale service for products, which consists of re-preserving products after transportation, giving them a marketable appearance, setting them up and testing, issuing a warranty passport, fine-tuning the products taking into account the interests of the importer, as well as after-sales service. Payments for products can be made in the exporter’s currency, the importer’s currency or in the currency of a third country;
trade in disassembled products is intended for subsequent progressive assembly of finished products in importing countries and is carried out in markets protected by high customs barriers to the import of finished products. Import of unassembled products is usually subject to reduced customs duties and has a number of advantages associated with the use of local cheap labor in their assembly (“screwdriver technology”), more preferential taxation, lower land rent, etc. Export of a number of assembled goods form is simply objectively impossible (reactors, port cranes, etc.);
trade in complete equipment involves the supply of technological complexes with a full range of services for their design, construction, commissioning, and preparation for operation in local conditions. A type of complete deliveries is the execution of contracts on a turnkey basis, providing for a range of works, starting from the preparation of a feasibility study, construction of the facility and ending with its commissioning, and payment after its acceptance by the customer. Such agreements also provide for the supply of necessary materials and tools, training of local personnel, assistance in organizing and managing the production process, and ensuring the operation of the facility during the warranty period.
3. One of the types of foreign trade in goods is counter deliveries. They represent export-import transactions, the terms of which provide for reciprocal obligations of exporters to purchase goods from importers for part or the full cost of exported products.
The main forms of counter deliveries are:
Barter transactions represent a non-currency, balanced, value-based exchange of goods at negotiated or world prices. The main reason for them is the shortage or lack of convertible currency among partners and its instability;
counter-purchases by exporters for part of the cost of the goods supplied;
compensation agreements, under the terms of which the repayment of a financial or commodity loan provided by the party supplying the technological equipment is carried out by the supply of goods produced on this equipment, or by the supply of goods produced by other enterprises;
repurchase of obsolete products when selling newer models and modifications. At the same time, the price of new products takes into account the residual value of returned products: operations with customer-supplied raw materials, involving the processing of raw materials extracted in one country by the production facilities of another country with payment of the cost of processing and transportation with additional supplies of raw materials. Such operations are justified when there are huge reserves of raw materials or waste and there is no or insufficient capacity for their processing.
For any form of counter deliveries, a valuation of the transferred products is necessary in order to create conditions for an equivalent exchange, as well as for customs accounting, determining the insurance payable in the event of loss of goods, and assessing claims. Penalties in this case are carried out by reducing supplies or additional supplies. With advance deliveries, the enterprise supplies its goods to the foreign counterparty in advance. The proceeds are credited to a special escrow account of the Western partner, who subsequently delivers his goods to the original (advance) supplier and receives payment from the above account.
In this way, the Western company is guaranteed to receive payment for the goods it has shipped, and the advance supplier, if the Western partner fails to fulfill counter-obligations, freely receives the proceeds back.
Foreign trade in services has a number of features compared to trade in goods.
First, services, unlike goods, are produced and consumed simultaneously in most cases and cannot be stored. Therefore, the provision of various services is based mainly on direct contracts between their producers and consumers and does not involve the use of intermediaries.
Secondly, services play an important and growing role in increasing the competitiveness of goods in the foreign market. The impact of services on trade in knowledge-intensive goods that require significant amounts of technical maintenance, information and consulting services is especially great.
Third, foreign trade in services encounters more barriers than trade in goods, since services are usually more strongly protected by the government from foreign competition.
Fourthly, not all types of services, unlike goods, are involved in international economic turnover. This mainly concerns services supplied primarily for personal consumption (utilities, household services, etc.).
Foreign trade in services includes various types of foreign economic activities, both traditional and modern (related to the export of new technologies, knowledge and experience), among which the most common are the following:
1. Export of transport services or international transport intended for the movement of goods (cargo) and people (passengers) between two or more countries, that is, in international communications. There are direct international communications, served by one mode of transport, and mixed (combined) communications, in which two or more modes of transport are used sequentially. International transportation is carried out by national carriers of various countries, using their rolling stock (sea and river vessels, airplanes, wagons, cars), as well as transport networks (railway, road, river, air) and transport hubs (sea and river ports, airports) , railway and bus stations, freight and passenger terminals).
In international trade, various types of basic conditions for the supply of goods are used, taking into account the transport factor in the foreign trade price. They regulate the responsibilities of the parties to ensure the transportation of goods at various stages of their movement from the supplier’s warehouse to the recipient’s warehouse, and provide for the procedure for distributing transport and other costs associated, in particular, with the risk of accidental loss or damage to the goods along the route.
Currently, when concluding contracts, the Incoterms rules are applied, including the following basic conditions and their interpretation:
“Ex-president” means that it is the responsibility of the seller to present the goods to the buyer directly at his warehouse (that is, at a factory, mine, plantation, etc.). The buyer bears all costs and risks associated with delivering the goods to their destination;
"Free on board" (PAC) (name of the port of shipment) implies that the seller's obligations are fulfilled when the goods are delivered on board the ship. Further costs and risks are borne by the buyer, including clearance of goods from duties and obtaining an export license and other similar documents;
Free on Board (FOB) (name of port of shipment) requires the seller to obtain at his own expense an export license or other document authorizing the export of the goods and to bear all costs necessary to ship them to the ship, including loading costs. The costs of delivery of goods are borne by the buyer;
Cost and Freight (CFR) (name of port of destination) imposes on the seller the responsibility to pay the costs and freight for transporting the goods to the port of destination, but the risk of loss or damage to the goods passes to the buyer at the port of shipment;
Cost, Insurance and Freight (CIF) (name of port of destination) is similar to CFR, but the seller additionally undertakes to insure the goods against accidental loss;
Delivered Ex Ship (DES) (named port of destination) means that the seller bears all costs associated with delivering the goods to the designated port. Further costs are borne by the buyer, including payment of customs duties and fees;
"Delivered Free Quay" (DEQ) (Duty Paid... Name of Port) obliges the seller to make the goods available to the buyer after paying customs duties and import charges at the port of destination. Further costs and risks are borne by the buyer;
“Delivery free-to-border” (DAF) (the name of the border point) assumes that the seller bears all costs and risks until the goods are handed over to the buyer at the designated place at the border, including payment of customs duties, taxes and fees in the country of departure of the goods;
“Delivered Duty Paid” (DDP) (name of the destination in the importer’s country) imposes maximum obligations on the seller, including concluding contracts with carriers of various modes of transport, processing transport and other documents, completing customs formalities, obtaining export and import licenses;
Free Carrier (FCA) (name of destination) is intended for use in intermodal transport. The seller is obliged to deliver the goods at his own expense to the point specified in the contract and hand them over to the carrier, as well as obtain an export license. The buyer must enter into an agreement with the carrier for the transportation at his expense of the goods to the final destination. The risk of accidental loss or damage to the goods passes from the seller to the buyer at the time of its transfer to the carrier;
"Freight paid to..." (CPT) (name of destination) obliges the seller to bear the costs of paying freight to destination and obtaining an export license. The buyer must pay other costs associated with the delivery of the goods;
“Freight and insurance paid to...” (CIP) (name of destination) means that the seller, in addition to paying freight and an export license, must provide transport insurance for the risk of loss or damage to the goods during transportation.
2. International tourism makes the largest contribution to international trade in services and accounts for about 25%. The basis of the tourism industry is formed by enterprises for the organization of tourist trips and the sale of vouchers and tours, providing services for accommodation and food for tourists (hotels, campsites, etc.), their movement around the country, as well as management, information, advertising, tourism research and preparation bodies for it personnel, enterprises for the production and sale of goods of tourist demand. One-time investments in the construction of hotels, transport hubs and arteries, leisure facilities, etc. quickly pay off and, if certain prerequisites are present, bring a stable and high income. There are three main types of international tourism: recreational, scientific and business.
3. Trade in licenses is the main form of technology transfer and is the transfer, under certain conditions, to some entity of the rights to use an invention, know-how, trademarks, etc. for a specified period for an appropriate fee. If technical innovations are not protected by a patent, then we are talking about a patentless license, which accounts for the bulk of the licensed trade. The most widespread are licensing agreements that provide for comprehensive international technological exchange with the provision of know-how and other services for the implementation of the transferred technology. The license agreement clearly and unambiguously defines the type of license (non-patent or patent), the scope of rights to use the transferred technology (full, simple or exclusive), the scope and boundaries of application of the technology, the validity period of the license agreement, the form of payment (royalties or lump-sum payments). Royalties are set in the form of fixed rates, which are paid by the licensee at agreed intervals during the term of the license agreement, that is, they are periodic royalties. A lump sum payment is a one-time remuneration for the right to use the subject of a license agreement before receiving profit from its use, and is the actual price of the license. During the period of validity of the license agreement, the receiving party (licensee) is obliged to inform the seller (licensor) about all changes in the technology.
4. International engineering is a complex of services of a production, commercial, scientific and technical nature related to the design of industrial enterprises, scientific and technical centers, infrastructure, etc.
Engineering services are provided by specialized firms or industrial, construction and other companies and are divided into two main groups:
A) services related to the preparation of the technological process, including pre-project, design, post-project and special services;
b) services related to the optimization of operating processes, enterprise management and product sales. Engineering services are paid by agreement: either time-based in the form of payments at hourly or daily rates, or on an actual basis (relevant costs plus remuneration are reimbursed). In construction, as a rule, payment for engineering services is set as a percentage of the cost of work.
5. International leasing is the long-term lease of production equipment, vehicles, computer equipment, and warehouse space. This is a specific form of financing capital investments, in which an enterprise that does not have foreign currency funds to purchase the corresponding object as full ownership gets the opportunity to operate it. Leasing transactions provide certain benefits to all parties involved. Lease payments are generally considered operating expenses and are therefore not taxable. In addition, the tenant has the opportunity, after the expiration of the contract, to purchase the leased item at its residual value into his own ownership or to enter into a new license agreement for new, more modern equipment, while avoiding losses associated with the obsolescence of means of production. In this case, customs duty is levied on the residual value of the purchased equipment, which means serious savings for the lessee. According to the rules of the International Monetary Fund, obligations arising from leasing are not included in the volume of the state's external debt. Therefore, he finds support from the state.
As part of international leasing, direct and indirect foreign leasing are distinguished. With direct foreign leasing, rental relations arise between legal entities of different countries. Direct foreign leasing is divided into export (in which the leasing company buys equipment from a national company and then provides it to the lessee abroad) and import (when the lessor purchases equipment from a foreign company, then provides it to the domestic lessee). In foreign indirect leasing, the lessee and the lessor are legal entities of the same party, but the capital of the lessor is partially owned by foreign persons or the lessor is a subsidiary of a foreign multinational corporation.
Along with long-term rent (leasing), short-term rent (rating) and medium-term rent (hiring) are also used in international trade.
Short-term rentals are a rare phenomenon in international practice. The subject of a rating contract is usually vehicles, travel and other non-durable goods. Medium-term rental contracts are more common. The subject of such contracts may be vehicles, road construction machines, installation equipment, and agricultural machines.
Lease contracts record the retention of ownership rights to the leased item by the lessor and contain obligations for the operation and maintenance of leased items, obligations of tenants not to disclose technical secrets and other conditions similar to those contained in sales contracts (force majeure, etc.) . A leasing contract is always concluded for a specific period, with the tenant having the right to extend the lease term or purchase the leased item.
Foreign trade operations carried out in international trade include the following main types: export, import, re-export and re-import operations.
Export operations include the sale and export of goods abroad to become the property of a foreign counterparty. Export may also include the sale of goods and services to foreign entities operating in the territory of the exporting country.
Import operations are the activities of purchasing and importing foreign goods for their further sale in the importer’s domestic market.
Re-export operations mean the export abroad of previously imported goods that have not been processed in the re-exporting country. In this case, it is allowed to carry out additional operations that do not change the name of the product. Thus, a product can be prepared for re-export based on the requirements of the countries of consumption: special markings can be applied, packaging can be changed, etc. However, the excess of the cost of additional operations for processing the product over half of its export price is the basis for turning such operations into export ones. An example of a re-export operation is the purchase of components abroad with their further re-export as part of complete equipment. Re-export can take place when selling goods through exchanges and auctions, when implementing large projects in free economic zones, or is carried out with the aim of making a profit on the difference in prices. Re-export does not include the transportation of goods through the country in transit.
Re-import operations include the acquisition and import from abroad of previously exported goods that have not been processed abroad. Re-import is considered, in particular, the return from abroad of goods that the buyer refused, or the return of goods previously supplied to intermediaries, but not sold by them abroad. Re-import does not include the return of goods that were previously exported abroad for consignment, exhibitions, fairs, under the conditions of temporary import and rental, since their export was not accompanied by sale.
Development of foreign trade
Taking into account Russia's competitive advantages and weaknesses, we can try to determine the medium-term prospects for the development of its foreign trade. It is obvious that fuel and raw materials will remain the main position in Russian exports for a long time. However, for Russia it is quite possible to deepen the degree of processing of raw materials and, on this basis, increase the share of such goods as cellulose, chemical products, fertilizers, etc. in exports.There are opportunities to stabilize and expand traditional mechanical and technical exports, which include cars and trucks, energy and road equipment, equipment for geological exploration, etc. Taking into account the availability of fairly cheap labor, it is very promising to create assembly plants from components imported to Russia, focused on the domestic and foreign markets.
There are certain prospects for expanding the export of high-tech products, which is closely related to the conversion and commercialization of defense industry enterprises (in particular, the export of aerospace technologies and services, laser technology, equipment for nuclear power plants, and modern weapons).
As domestic agriculture and light industry develop, obviously, the share of consumer goods in Russian imports will decrease and the share of investment goods - machinery and equipment - will increase.
The prospects for the development of Russia's foreign trade largely depend on the implementation of the competitive advantages of its industrial complex. In addition to raw materials, these include: a fairly high level of skilled labor with its comparative cheapness, as well as significant volumes of accumulated fixed production assets and funds of universal processing equipment, which makes it possible to reduce the capital intensity of technological modernization of production; the presence of unique advanced developments and technologies in a number of sectors of the economy, mainly related to the military-industrial complex.
However, the use of these benefits is constrained by a number of reasons. This is the underdevelopment of the financial and organizational infrastructures of foreign trade cooperation; lack of a developed system of government support for exports; difficulties in adapting to the conditions of mass production based on competitive technologies concentrated in the defense complex and intended for small-scale or single production; low production efficiency and extremely high share of material costs even in advanced industrial sectors.
The structure of Russian foreign trade was not previously typical for a developed country. Currently, these are mainly fuel and energy, simple chemical and petrochemical goods, ferrous and non-ferrous metals, and weapons.
Significant changes have occurred in the commodity structure of Russian imports. The share of investment goods has decreased, while the share of consumer goods has increased, accounting for about 40% of total imports.
With a population of almost 150 million, possessing significant energy resources, fairly highly qualified labor resources at low labor costs, Russia represents a huge market for goods, services and capital. However, the degree to which this potential is realized in the foreign economic sphere is very modest. Russia's share in world exports was about 1.3%. The state of Russian foreign trade is still painfully affected by the sharp reduction in economic ties with other former Soviet republics as a result of the collapse of the USSR and the curtailment of trade with the former socialist countries - members of the CMEA, which were the main consumers of domestic engineering products.
But if Russia’s role in world trade is small, then for itself the importance of the foreign economic sphere is very significant. The size of Russia's export quota, calculated on the basis of the purchasing power parity of the ruble to the dollar, is about 10%, divided between the far and near abroad in a ratio of approximately 5:1. Foreign trade remains an important source of investment goods, and also plays a large role in supplying the Russian population with food and various consumer goods.
Foreign economic trade
The term “foreign economic activity (FEA)” is commonly understood as the process of implementing foreign economic relations, including trade, joint ventures and the provision of services. Currently, foreign economic activity plays an important role in the functioning of the national economy, representing the main way of Russia’s integration into the world economy, as well as being one of the most significant sources of state revenue.Among the many existing forms of foreign economic activity, one of the most significant should be highlighted - foreign trade, which is understood as trade between countries, consisting of the export and import of goods and services, carried out mainly through commercial transactions formalized by foreign trade contracts.
The concept of “foreign trade activity (FTA)” is defined in the Federal Law “On the Fundamentals of State Regulation of Foreign Trade Activity” as the activity of carrying out transactions in the field of foreign trade.
The mentioned law also distinguishes four groups of foreign trade objects:
Foreign trade in goods – import or export of goods;
- foreign trade in services – provision of services/performance of work, including production, distribution, marketing and delivery of these services/work;
- foreign trade in information - information acts either as an independent object of foreign trade activity, or as an integral addition to other objects of foreign trade activity;
- foreign trade in intellectual property – transfer of exclusive rights to intellectual property or granting the right to use intellectual property.
Speaking about the structure of foreign trade, we immediately recall the existence of such concepts as import and export of goods, in other words, the import and export of goods.
Russia's main trading partners in exports were: the Netherlands, Italy, Germany, China, Turkey and others. As for goods directly, Russia should be noted as the largest exporter of military weapons, products of the fuel and energy complex, machinery and equipment, wheat and other grains.
In modern conditions of an unstable and unstable economic situation, ensuring a high level of efficiency of foreign economic activity requires a continuous increase in efforts to improve it. Despite the differences, all forms of foreign economic activity are connected with each other, which determines the implementation of foreign economic activity as a single uninterrupted process. The progress of foreign trade created the preconditions for the emergence of other forms of foreign economic activity, the development of which led to the transformation of the latter into the most important subsystem of the national economy.
Foreign trade is trade between countries, consisting of export (export) and import (import) of goods and services. Foreign trade is carried out mainly through commercial transactions formalized by foreign trade contracts.
Foreign economic activity is an important part of international economic relations. It stimulates an increase in the competitiveness of national products, a reduction in domestic prices for goods and an increase in the efficiency of national production through the use of advanced engineering and technological solutions, facilitating the transition to a new technological level. Foreign trade as part of foreign economic activity characterizes not only the system of commodity circulation, but also the sphere of interconnected state interests of different countries in building mutually beneficial partnerships of counterparties and participants in foreign trade activities. International trade reflects the total volume of foreign trade of most countries of the world community, and the total amount of sales of goods and services within its framework forms international trade turnover. Foreign trade operations on the international market represent the interaction of commodity producers and commodity consumers of different countries, the result of which is the volume of foreign trade of states. Foreign economic activity is a significant component for the Russian economy and the system of foreign economic relations: exports and imports prevail in the formation of Russia’s balance of payments, ensuring a positive balance not only in current transactions, but also in the basic balance.
Foreign trade measures
Restricting the admission of certain types of goods of foreign origin to government procurement in order to protect the domestic market and Russian manufacturers. Unilateral measures of non-tariff regulation of imports. Introduction of bans on the import and circulation of certain categories of goods in Russia. Special economic measures to ensure the security of the Russian Federation.Administrative measures of state regulation of foreign trade activities, involving direct (administrative) impact on international trade entities, determine the structure of the national market of the Russian Federation, protecting it not only from excessive import supplies of goods, but also from potential shortages of goods in the country’s domestic market. These include: import licensing; import quotas. Import licensing as an instrument of state foreign trade regulation, according to international trade practice established in Russia, occupies a leading place in the system of administrative measures to protect sectors of the Russian economy from foreign competition. It represents a quantitative restriction in the form of the right or permission from authorized government bodies to import goods into the customs territory of the Russian Federation. As is known, the practice of foreign trade activities has developed two forms of import licensing: automatic import licensing; non-automatic import licensing. Automatic import licensing is an administrative procedure used when importing goods into Russia, where approval of an application for a license is given in all cases without exception.
It applies subject to the following preconditions:
1) presence of an application, i.e. an official application to the authorized government body in writing with a request to obtain an import license agreed with the country exporting the goods;
2) any person, enterprise or institution that fulfills the legal requirements of an authorized government agency for import operations, including the import of goods subject to automatic licensing, is equally entitled to apply for and obtain an import license;
3) automatic import licensing may be maintained as long as the circumstances giving rise to its introduction prevail and the administrative objectives underlying it cannot be achieved in a more suitable manner.
Temporary restrictions on the import of goods of an administrative nature can essentially include declarative (automatic) licensing of the import of certain categories of goods (for monitoring purposes), such as: carpets and textile floor coverings originating from the EU; color televisions; white sugar, raw sugar, starch syrup. It is assumed, and this position should be supported, that automatic licensing will help limit the import of cheap and low-quality imported products into the Russian Federation and thereby temporarily protect the interests of domestic producers. Non-automatic import licensing, as a diametrically opposed form of automatic import licensing, in our opinion, has a number of limitations.
In particular:
1) non-automatic import licensing must not restrict or disrupt the import of goods into the customs territory of the Russian Federation in addition to the impact caused by the imposition of this restriction;
2) in the event of the introduction of non-automatic import licensing for purposes other than quantitative restrictions on the import of goods into the Russian customs territory, all participants in foreign trade transactions must be allowed access to information necessary and sufficient to understand the basis for the provision and/or distribution of import licenses;
3) non-automatic import licensing procedures in scope and duration must be consistent with the measure for which they are used, and in administrative terms should not be more burdensome than necessary to support the measure applied.
Automatic and non-automatic import licensing is formalized by a special document called a license, which establishes the procedure and contains permission to move a certain amount of goods across the customs border of the Russian Federation.
Import quotas (provisioning) as a specific instrument of state foreign trade regulation have not yet found an adequate place in Russia in the system of non-tariff measures to protect sectors of the national economy from foreign competition. Suffice it to say that limiting the quantity of goods in the form of an import quota became somewhat widespread in Russian foreign trade practice only in the second half of the 90s. In particular, attempts to introduce a quota were made in relation to the import of textile and alcohol products, as well as ethyl alcohol produced from food raw materials.
Meanwhile, an import quota (contingent) as a special measure to protect the domestic market, affecting directly the quantitative and cost supply of imported goods, has a number of obvious and practice-tested advantages.
First of all, an import quota guarantees that the import of goods into the customs territory of the Russian Federation will not exceed a given value, since it deprives foreign companies of the opportunity to expand the supply of products to the Russian market by reducing export prices and thereby allows domestic producers, fearful of price competition, to retain a certain share in the domestic market.
The accumulated international and domestic experience in customs and tariff regulation of foreign trade activities and the analysis we performed above allow us to identify a number of tools for protecting the domestic market from unwanted competition from foreign companies.
The first tool: non-tariff measures aimed primarily at creating equal conditions for competition in the national (domestic) market. The use of special protective measures, anti-dumping measures and compensation measures will ensure “selective” protection of the interests of domestic producers in cases of violation of normal conditions of competition by increased, dumping or subsidized imports of goods into the customs territory of the Russian Federation, causing significant damage (or a real threat of significant damage) to those or other specific sectors of the Russian economy. The procedures for such measures should be simple, “transparent” and well tested in practice by objective criteria, and the use of other non-tariff measures to regulate import operations, such as standards, requirements for packaging, labeling, etc., should be related exclusively to security purposes, protecting the life and health of consumers.
When implementing non-tariff measures, first of all, it is necessary to strive for transparency, openness and predictability of their application. Therefore, it is advisable to create an effective mechanism for special judicial (or administrative) resolution of disputes that systematically arise between economic operators and executive authorities in connection with decisions affecting the interests of business in the field of foreign economic relations. At the same time, administrative regulatory measures must be reduced to a reasonable optimum, ensuring reasonable and reliable state control over economic activity.
The second instrument for implementing foreign trade and economic policy: the principle of reciprocity within the framework of generally accepted norms and rules of international trade. The best conditions for access of foreign goods to the customs territory of the Russian Federation should be provided primarily for those countries that provide domestic producers with conditions for the supply of goods to their national markets that are comparable in volume and economic effect. From this point of view, the need to revise approaches to reforming and developing the legal framework for foreign economic relations both with third countries and with international integration organizations is obvious.
The third tool is the formation of a system of control over the enforcement of Russia's rights arising from bilateral and multilateral international trade agreements. This tool is necessary for an adequate response to any cases of violation of such rights, discrimination of Russian enterprises, their goods and services in foreign markets. Russian economic operators must be given equal opportunities to protect their economic interests.
The fourth tool: targeted support for structural changes in Russian exports. It should be concentrated on those sectors of the national economy that have real or potential competitiveness.
Currently, these include aircraft manufacturing, commercial space launch services, as well as some other science- and capital-intensive industries. Such support should be provided in forms that exclude the possibility of legal use of protectionist instruments by trading partners.
And finally, the fifth tool: the implementation of the “dictatorship” of the law. The problems of changing existing legislation and developing new legislation are so large-scale that, according to preliminary estimates of experts, it will take at least 3 years to bring the legislative framework for foreign trade activities in Russia into compliance with WTO requirements.
The current model of Russia's interaction with the global world market does not correspond to either its potential competitive capabilities or its long-term economic interests. In this regard, the issue of Russia's accession to the World Trade Organization becomes of fundamental importance. By joining the WTO, Russia sets itself a number of important goals. First, Russia strives to become an equal trading partner on the world market and create more favorable conditions for its exports. At the same time, it is necessary to proceed from the fact that as a result of joining the WTO, the problems of discriminatory attitude towards Russia on the part of Western countries, which do not always recognize Russia as a country with a market economy, should be resolved. Secondly, the system of maintaining discipline in international trade, including the dispute resolution mechanism, that exists within the WTO is of interest to Russia. Thirdly, joining the WTO will allow Russia to transfer trade and economic relations with other countries and groups of countries to an equal, predictable, long-term economic and legal basis. And finally, fourthly, the process of accession to the WTO will create additional incentives for harmonizing Russian legislation and bringing it into line with international requirements. In more specific terms, the conditions for accession to the WTO are a compromise developed during negotiations, a consensus achieved through mutual concessions and mutual, often strict, obligations. Russia faces a difficult task - to determine not only national economic interests and priorities, obligations and conditions that guarantee national economic security, but also to be able to defend them during complex negotiations, in the conditions of already manifested economic pressure from Western countries, their attempts to achieve unilateral market opening, non-reciprocal concessions, reluctance to recognize the fact that many enterprises and sectors of Russian industry have comparative advantages that allow them to export goods at competitive prices and significantly influence the formation of world prices.
Foreign trade policy
Foreign trade is trade between countries, consisting of the export and import of goods and services. Its volume is calculated by summing the volumes of exports and imports. Export is the sale of goods that involves their export abroad. Import is the purchase of a product that involves its import from abroad. Export and import are two key concepts characterizing the international movement of goods, which are used for a comprehensive analysis of foreign trade and for practical purposes. The total amount of exports and imports is foreign trade turnover with foreign countries. Exports and imports of goods for which payments were made during a given period form the trade balance. The trade balance is only part of the balance of payments. The balance of payments includes the sum of all cash payments made by a given country to other countries during a given period, and the sum of all cash receipts it received from other countries during the same period. It is possible to have a passive trade balance, i.e., the excess of imports of goods over exports, and at the same time, an active balance of payments, i.e., the excess of cash receipts from abroad over payments to other countries.There are a number of indicators characterizing the degree of a country’s involvement in foreign economic relations. For example, the export quota shows the ratio of the value of exports to the value of GDP. The volume of exports per capita of a given country characterizes the degree of “openness” of the economy. Export potential (export opportunities) is the share of products that a given country can sell on the world market without damaging its own economy (minus internal needs).
It should be noted that the export orientation of production makes it dependent on changes in world prices, fluctuations in supply and demand, and competition in the world market. This dependence is especially dangerous for countries with a narrow specialization of the economy, the development of which is predetermined by export earnings. Import dependence is no less fraught with dangerous consequences. Rising world prices, trade deficits, restrictions on foreign trade supplies in the exporting country - all this can adversely affect an economy that is overly dependent on imports. Production created with the participation of foreign capital and on the basis of imported technology can lead to dependence on foreign economic centers.
The country's foreign trade is regulated by the state in the implementation of foreign trade policy. When developing and implementing foreign trade policy, two fundamental approaches are used. The first, free trade, presupposes freedom of trade, its implementation without restrictions; the second, protectionism, justifies government intervention in international trade in order to promote its growth, taking into account the interests of the national economy. Instability in world trade and global economic crises force countries to use a policy of trade protectionism. Previously, protectionism relied mainly on the tariff and customs system, but after the Second World War the importance of non-tariff barriers, the number of which is constantly growing, sharply increased. The purpose of non-tariff barriers is to generally restrict imports through trade discrimination against individual countries. Non-tariff barriers include the state monopoly of foreign trade, ensuring government consumption only with domestically produced goods, complex currency controls over the import of goods, sanitary standards for food products, etc. The most widespread type of non-tariff restriction in recent years is import quotas , i.e., a quantitative limitation on the volume of foreign products annually permitted by the state for import into a given country. The state issues a limited number of import licenses and prohibits unlicensed imports.
Foreign trade methods
Methods of international trade are ways of carrying out a trade transaction between its participants, both from one country and from different countries of the world.Typically, international trade consists of exports and imports, but there are six methods of international trade:
Straight;
indirect;
cooperative;
counter;
institutional;
electronic.
Direct export or import is an international trade transaction directly between the proposed party (manufacturer, seller) and the acquired party (buyer, consumer, user) of trade relations.
Indirect export or import - engaging an intermediary to complete an international trade transaction.
Cooperative export or import is the conclusion of an international trade transaction with the involvement of a special intermediary, which is an organizational form of business formed by a group of initiators of this agreement, if the transaction by each member of this group individually seems ineffective, impossible or quite risky.
These three methods are determined by the degree of involvement of export-import operations in direct execution, that is, how the main operations are carried out (using one’s own resources, using an intermediary, or joint efforts of interested parties). The counter method is trade, which involves the preparation, support and completion of such international commercial transactions that use hard currency in payment, differing in the method and procedure for carrying out international transactions.
The institutional method involves conducting operations with the involvement of special institutions: international auctions, exchanges and trades, which establish the quality and price of goods sold through them.
Electronic commerce involves conducting international trade operations via the Internet.
The method of international trade is a method of carrying out a trade exchange (trade operation or trade transaction) between its participants who are residents of both different (direct method) and one (indirect and cooperative methods) countries. Despite the fact that in international trade practice there are usually two main methods of trade, six methods are usually considered.
Direct export (import) - an international trade transaction directly between the manufacturer/seller and the buyer/consumer/user.
Its advantages:
Reduces production costs;
reduces the risk and dependence of performance results on possible dishonesty and incompetence of intermediaries;
allows the manufacturing company to constantly be in the foreign market, take into account its changes and respond in a timely manner.
Indirect export (import) - carrying out an international trade transaction through an intermediary.
Its advantages:
The intermediary has higher commercial qualifications;
there is no need to concentrate financial and intellectual resources at the first stage of entering the foreign market.
However, taking into account the reality of modern international business, another method is added, a third one, which, having originated in the field of small and medium-sized businesses, occupies a middle position between the first two (classical ones).
Cooperative export (import) is the execution of an international trade transaction through a special intermediary, which is a certain organizational form of business created by a group of initiators of this transaction, the completion of which by each individual member of this group seems impossible, too risky and/or economically ineffective.
Countertrade stands out as a method due to the peculiarities of the preparation, support and completion of such international commercial transactions, payment for which is carried out without the use of (hard) currency or is only partially covered by currency, i.e. it is noticeably different and distinguished by the method and procedure for carrying out international transactions.
International auctions, exchanges and trades involve conducting trading operations through special institutions. Considering the fact that all of the listed institutions have the unifying function of establishing the quality and price of goods sold through them, based on the relationship between supply and demand and the assessments of participating buyers, some authors propose calling this method institutional-competitive.
The sixth method was developed only in the last decade of the 20th century, when such a basic resource, or a sufficient condition for globalization, as global communication systems, matured and underwent qualitative changes, the information part of which was realized in the creation of the World Wide Web - the Internet. This is electronic commerce, or e-commerce.
World foreign trade
World trade is the exchange of goods and services between state-national economies. The development of world trade led to the emergence of a world market for goods. The world market is a set of interconnected and interacting national markets of individual countries, participating in the international division of labor and connected with each other by a system of international economic relations.International trade is growing and developing due to the profitability and expediency of the international division of labor, the concentration of production of certain products in individual countries for the purpose of their subsequent sale on the world market and thereby meeting the needs of other countries that create demand for this product.
If previously the main prerequisite for international trade was the uneven distribution of resources between different countries, today differences in the efficiency of resource use and technologies used are becoming increasingly important.
Development of international trade:
Allows you to overcome the limited national resource base;
expands the capacity of the domestic market and establishes connections between the national market and the world market;
provides additional income due to the difference between national and international production costs;
expands the production capabilities of countries (the production possibilities curve shifts to the right);
leads to deepening specialization of production and, on this basis, increasing the efficiency of resource use and increasing production volume.
World trade is formed on the basis of foreign trade carried out by different countries. The term “foreign trade” refers to trade with other countries, consisting of paid import (import) and paid export (export) of goods.
The main differences between foreign trade and domestic trade:
Goods and services are less mobile globally than within a country;
When making calculations, each country uses its national currency, hence the need to compare different currencies;
foreign trade is subject to greater government control than domestic trade;
more buyers and more competitors.
Foreign trade of an individual country is characterized by the following indicators:
The amount of trade turnover (the sum of exports and imports);
foreign trade balance - the ratio of exports and imports. If exports are greater than imports, the country has a positive foreign trade balance (active trade balance), if imports are greater than exports, it has a negative balance (passive trade balance). The difference between exports and imports forms net exports;
export and import quota - the share, respectively, of exports and imports in GNP. The share of imports and exports in the volume of national production shows the degree of a country’s involvement in international trade, the degree of “openness” of the economy. The export quota is: 45% in Holland, 13% in the USA, 11% in Japan;
export potential (export opportunities) - the share of products that can be sold by a given country without damaging its own economy;
structure of foreign trade: subjects (with whom the country trades) and objects (what the country trades).
The state of the country's foreign trade and the level of its development depend primarily on the competitiveness of the goods produced, the level of which is influenced by:
The country's provision of resources (factors of production), including information and technology;
capacity and requirements of the domestic market for product quality;
the level of development of connections between export industries and related industries and industries;
the strategy of firms, their organizational structure, the degree of development of competition in the domestic market.
World trade is usually characterized in terms of its volumes, growth rates, geographical (distribution of commodity flows between individual countries, regions) and commodity (by type of product) structure.
World trade in the modern world is developing at a rapid pace.
Stable, sustainable growth of international trade is influenced by:
Deepening the international division of labor and internationalization of production;
Scientific and technological revolution, promoting the creation of new sectors of the economy and accelerating the reconstruction of old ones;
active activity of transnational companies in the global market;
liberalization of international trade;
development of trade and economic integration processes, elimination of intercountry barriers, formation of free trade zones, etc.
A feature of modern world trade from the point of view of its geography is the increase in mutual trade between developed countries - most of the world trade turnover is trade between the USA, Western Europe and Japan. The share of the Asia-Pacific region in global trade turnover is growing at a high rate. Among individual countries, the largest trade turnover falls on the United States (28% of world trade), followed by Germany, Japan, France, and the United Kingdom.
In the structure of world trade turnover, finished products absolutely predominate (70%) and only 30% falls on the share of raw materials and food. (For comparison: in the first half of the 20th century, more than 60% of trade turnover accounted for food, raw materials and fuel.) The world exchange of communications equipment, electronic equipment, computers, components, components and parts is growing at the fastest pace.
Along with goods, world trade includes the exchange of services of transport, communications, tourism, construction, insurance, etc. It is worth noting the unprecedented growth in trade in services. The exchange of services on the world market is growing twice as fast as the exchange of goods.
Structure of foreign trade
The structure of foreign trade includes export and import operations.Export is understood as a type of entrepreneurial foreign trade activity associated with the receipt by an enterprise (resident) of foreign currency earnings as a result of the sale and export of its competitive products to a foreign partner (non-resident) outside the country.
The export operation scheme includes:
A) signing a contract for the supply of goods;
b) supply of goods.
The main products that characterize the export operation are:
Conclusion of a contract with foreign counterparties (non-residents);
goods crossing the country's border by exporters (residents);
receipt of payments by the exporter (resident) in foreign currency:
a) in the currency of the country of the importer (non-resident);
b) in the currency of the country of the exporter (resident);
c) in the currency of any third country, for example in US dollars.
The currency is determined by the terms of the trade and payment agreement.
Exports can be of two types: non-resident (when an enterprise exports surplus from time to time, offering goods to local wholesalers representing foreign firms) and active (with the aim of expanding exports in a specific market).
In addition, exports can be direct or indirect. Direct export is carried out through the export department of the enterprise located in its own country, through a sales department (branch) abroad, traveling salesmen for export operations, and also through foreign distributors or agents.
Indirect export is carried out by attracting independent intermediary exporters, agents, and various organizations. Indirect exports are most common abroad.
Two factors contribute to this:
1) the enterprise produces all goods in its own country, therefore, less capital investment is required to expand production and create its own trading apparatus abroad;
2) less risk.
It should be noted that the Russian practice of export operations differs from the Western one.
This is due to the following circumstances:
A) a certain part of Russian exporters (residents) make investments abroad in the interests of creating their own infrastructure for marketing products;
b) enterprises (residents) incur lower fractional costs in the export area compared to organizing supplies to the domestic market; for many of them it is more profitable to have their own partners and standard contracts than to overcome the difficulties of establishing activities in the domestic market associated with the almost complete absence of infrastructure for ensuring business cooperation and with numerous and ineffective paper procedures;
c) exporting enterprises (residents) experience low risks compared to the volume of non-payments within the country.
Thus, as a result of these circumstances, as well as the guarantee of payments for exports, an increase in efficiency and exports is ensured, and at the same time the exporter is “linked” to external markets.
Import is understood as a type of business activity of Russian residents associated with the purchase from non-residents and the import into the resident’s country of goods, services and technologies for subsequent sales on the domestic market.
Import operations require residents to have a thorough knowledge of the goods, observe changes in market conditions, and also choose the right moment for concluding contracts. There are two types of import operations: direct and indirect.
With direct import, Russian residents buy goods directly from a foreign manufacturer (non-resident) or from an export intermediary abroad. An import transaction is carried out between a resident (domestic recipient) and a non-resident (supplier) abroad.
With indirect import, Russian enterprises (residents) buy goods from a domestic merchant (individual company) specializing in import transactions, who in turn receives goods from a foreign manufacturer (non-resident) or exporter (this may also be another resident). An import transaction is carried out between a domestic merchant specializing in the import of certain goods and a supplier abroad.
The import regime also comes in two types: unlicensed import and licensed import. Unlicensed import is carried out in the case when the conclusion of import contracts has no restrictions, i.e. An importer (non-resident) may, without special permission from regulatory authorities, enter into a sales agreement (contract) with a foreign supplier (another non-resident), import goods into Russia and make payment.
Licensed import is carried out when the import of goods from abroad requires special permission from regulatory authorities, which determine the conditions, volume and issue licenses for a certain type of goods. Only after receiving an import license can an importer (non-resident) enter into a sales contract with a resident. To carry out an import operation, the importer (non-resident) must have the financial means to purchase goods, know potential suppliers, analyze the prices of competitors offering the desired product, enter into a contract with the most preferred exporter (resident), receive the purchased goods and make payment for it. It is also important to know the methods of purchasing goods, which are of three types: wholesale, regular purchases in small quantities, purchases as needed. The mechanism of an import transaction can be presented as follows.
The import operation scheme includes:
A) signing a contract for the purchase of goods;
b) supply of goods.
The main features of import operations are:
Concluding a contract with a foreign counterparty (non-resident);
goods crossing the border of the importing country (non-resident);
payment for the object of the contract in foreign currency.
A prerequisite for an import operation is the solvency of the importer (non-resident).
When carrying out import operations, three factors are taken into account:
1) the need to pursue a policy of protectionism;
2) providing national consumers (enterprises and the population) with products that are not produced within the country or are produced in insufficient quantities;
3) performing the fiscal function with the help of import tariffs, i.e. providing the budget with the necessary financial resources.
Varieties of export and import operations are re-export and re-import operations.
Terms of foreign trade
The amount of gain or loss a country makes depends on the size of its exports and imports. Their ratio is determined by the structure and degree of competitiveness of national production: industries with strong competitive potential become exportable, while the rest leave room for imports. The efficiency of foreign trade operations depends not only on the physical quantities of foreign trade flows, but also on their price expression. On the world market, prices are subject to changes and market fluctuations. They dramatically change the magnitude of the results of international transactions.The efficiency of a country's foreign economic transactions will increase when the prices of its exports rise and the prices of its imports fall. The country will be in an unfavorable situation if the price dynamics for these groups are opposite. The dependence of a country's position on price fluctuations in the world market reflects such a concept as terms of trade.
The terms of trade indicator is calculated both for the country as a whole and for individual foreign trade firms. It can be aggregate, i.e. cover total values for exports and imports, or reflect a similar ratio for individual goods. An increase in the terms of trade indicator means an increase in the country's income from its foreign trade operations; a decrease, on the contrary, means losses.
To determine the efficiency of foreign trade operations, the terms of trade indicator is expressed as a percentage, i.e. multiplied by 100. Then, if ToT > 100, the terms of trade for the country are favorable. International trade will bring benefits. With ToT
The given indicator of the terms of trade is called barter, or commodity. It shows the winning or losing position of the country from foreign trade transactions. But when a country wants to determine the total amount of net gain from foreign trade, i.e. to indicate the profitable terms of trade, it must multiply the commodity terms of trade by the quantitative export index.
In recent years, terms of trade for developed countries have been improving, while for PCs and countries with economies in transition they have continued to deteriorate. This situation is associated with an increase in demand and, accordingly, prices for high-tech products in highly developed countries. The need for it is increasing due to the desire of lagging countries to join the process of catching up development.
Now there is an increase in demand in global commodity markets due to the growth of industry in China, India and the newly industrialized countries of Asia. For Russia, this situation provides a chance to quickly increase export revenues and increase GDP.
A country integrating into the world market can increase its income using structural strategies in the form of:
Increasing the potential of export industries;
reducing dependence on imports.
Export-expanding economic growth multiplies a country's income. But saturation of the world market with export goods will lead to a fall in their selling prices, which will worsen the terms of trade for the country.
Countries suffering from the dominance of imports are striving to stimulate import substitution. This could lead to a fall in import demand and prices, which would improve the terms of foreign trade.
When developing directions for foreign trade policy, Russia should not forget about the benefits of import substitution processes.
A trade fair is a short-term event held periodically in the same place, in which a large number of enterprises, with the help of samples, present an objective scale of goods/services of one or more industries, so that the visiting trader gets a clear idea of their business opportunities, while the exhibitor, with the help of exhibited goods, seeks to disseminate information about his company and its products and conclude direct trade deals.
A trade and industrial exhibition is a short-term event, periodically held in the same place, in which a significant number of enterprises, with the help of samples, give a representative picture of the offer of goods/services of one or more industries and seek to inform end consumers about their company and its products with the final result. for the purpose of promoting sales.
According to the nature of the exhibitors, all exhibitions and fairs are divided into:
Universal;
specialized.
Purposes of the company’s participation in fairs and exhibitions
First of all, you need to clearly define the goals that the company sets for itself by participating in the exhibition.
Typically, such goals include:
Demonstration of products, presentation of new goods (services);
brand promotion, improving the company's image;
study of sales markets, formation of a dealer network;
company advertising;
direct sales of products;
study of competitors' products and strategies.
For example, well-known computer companies (IBM, DELL, Hewlett Packard), or manufacturers of electronic equipment (SONY, PANASONIC, PHILIPS, BOSCH, SIEMENS, etc.), will participate in all thematic exhibitions: both general and highly specialized, in order to “show themselves” , “look” at competitors, support the image and brand, make it clear that they stand firmly on their feet and control the market.
Protectionism in foreign trade
In order to maintain domestic production, all states participating in international trade use import controls in various forms. Generally speaking, such measures are called protectionism in international trade. This phenomenon takes the form of a wide range of obstacles invented by the governments of countries, aimed at adjusting the commodity and financial flows involved in international trade. Among the various instruments for protecting the domestic market, economic and political spheres, quotas, tariffs, and subsidies should be noted. All of them were used to stimulate the export of domestic goods and protect the country's economic sectors from import competition. Protectionism in international trade, namely its extreme measure, is a complete ban on the import of certain categories of goods, which is observed today in Russia.Protectionism is patronage in the economic sphere by the country's leadership in relation to participants in the domestic market, protecting this market from foreign products and, on the contrary, promoting competitive export goods to foreign markets within the framework of international trade.
The policy of protectionism aims to protect the national economy from competition from foreign producers and stimulate its development, which is achieved through non-tariff and tariff regulation of international trade.
The relevance of the task of developing an adequate economic policy of protectionism in Russia is increasing due to the intensification of globalization processes in international trade. It becomes especially important to stimulate the growth of the competitiveness of domestic products both in the local and global markets. Due to the more active implementation of protectionism in Russia in relevant areas, it is possible to facilitate, accelerate and increase the efficiency of adaptation of Russian producers to the new post-crisis realities of the world economy and international trade.
Throughout the history of Russia, the preferences of government officials in the field of economic policy changed from a preference for protectionism in the Russian economy to free trade and back, although they never took extreme forms. Note that a completely open economy, characterized by the free movement of all factors of production across state borders in international trade, has never been observed even abroad. The international circulation of production resources is invariably regulated to one degree or another by the governments of countries. In an open economy, however, the economic interests of the state itself are taken into account.
Much has been said and written on the topic of comparing the concepts of protectionism and free markets in international trade, both by politicians and economists. The first is good because it contributes to the development of national industry, the latter because of information transparency and the possibility of direct comparison of global and domestic costs. Preference was given to free trade and liberalization in the 50-60s of the last century, but since the beginning of the 70s, protectionism in international trade has intensified, and the number of non-tariff and tariff barriers between countries has increased.
Among the main goals of the policy of protectionism in Russia and the world are:
Protection on a permanent basis of strategic sectors, such as agriculture, problems in which could lead to critical vulnerability of the state in the event of war;
Temporary support for young industries formed in the domestic market, from the moment of their development to the level of competitiveness in the world market;
Response to protectionist activity on the part of trading partners.
The diversity of protectionism in international trade in terms of its narrow objectives allows us to identify a number of forms of this activity:
Selective protectionism - protection from a specific product or protection from a specific state;
Sectoral protectionism - protection of a certain industry (primarily agriculture within the framework of agricultural protectionism);
Collective protectionism - mutual protection of several countries united in an alliance;
Hidden protectionism - protection using non-customs methods, including methods of domestic economic policy.
Non-tariff regulation of foreign trade
Customs tariffs remain the most important instrument of foreign trade policy, but their role has gradually weakened over the past decades. In the post-war period, a significant reduction in tariff barriers was achieved during multilateral negotiations within the GATT framework. However, the degree of government influence on international trade has actually increased over the years, which is associated with a significant expansion of the forms and measures of non-tariff trade restrictions. It is estimated that there are currently at least 50 of them. Industrialized countries are especially active in using non-tariff measures to regulate trade. By the beginning of the 21st century. On average, 14% of goods imported by the EU, the US and Japan were subject to major non-tariff restrictions: import quotas, voluntary export restrictions and anti-dumping measures. Less open-ended than tariffs, non-tariff barriers provide greater scope for arbitrary government action and create significant uncertainty in international trade. In this regard, the World Trade Organization is faced with the task of gradually eliminating quantitative restrictions, i.e. carry out so-called tariffization (replacing quantitative restrictions with tariffs that provide an equivalent level of protection).Non-tariff measures used in foreign trade policy are diverse, and their role as customs tariffs are reduced does not decrease, but increases.
The most common are those aimed at directly restricting imports:
Quotas;
licensing;
voluntary export restrictions;
technical limitations;
anti-dumping legislation.
Of particular importance are quotas and licensing of imports and exports.
QUOTATION
This is limiting the size of imports using the so-called global, individual, seasonal and other types of percentage restrictions.
The global quota, which accounts for two-thirds of all cases, sets a limit on the volume of imports in value or volume terms for a certain period. The total amount of imports allowed under the quota is not broken down by country.
An individual quota provides for the amount of imports in relation to specific countries or a specific product (its manufacturer). As a criterion for the distribution of individual quotas, reciprocal obligations of states to import goods from a given country are taken into account. Such obligations are secured by trade agreements and take on the nature of bilateral quotas on a contractual basis.
Seasonal quotas set a limit on the size of imports of agricultural goods for a certain time of the year. Import restrictions without taking into account the time period are represented by unspecified quotas.
Quotas are introduced to balance foreign trade and balances of payments, regulate supply and demand in the domestic market, fulfill international obligations and achieve mutually beneficial agreements in intergovernmental negotiations.
LICENSING
This non-tariff measure in international trade is very diverse. Licensing is a restriction in the form of obtaining the right or permission (license) from authorized government bodies to import a certain volume of goods. The license may establish the procedure for importing or exporting goods.
Licensing is interpreted in international practice as a temporary measure, which is carried out on the basis of strict control of certain commodity flows. It is practiced in cases of temporary restriction of unwanted volumes of imports. In modern foreign practice, general and individual licenses are mainly used.
A general license is a permanent permit for a company to import certain goods from the states listed in it without limiting the volume and cost. Sometimes the license indicates goods prohibited for import. General licenses with lists of goods are regularly published in official publications.
An individual license is issued as a one-time permit for one trade operation with a specific type of product (sometimes two or three types, but of the same product group). It also contains information about its recipient, quantity, cost and country of origin of the goods. It is personal, cannot be transferred to another importer and has a limited validity period (usually up to one year).
An integral element of licensing is contingent, i.e. establishment by the state of centralized control over the calling and importation by limiting the range of goods within established quantitative or cost quotas for a fixed period of time. Currently, GATT/WTO provisions allow the introduction of quantitative restrictions on imports in the event of a sharp imbalance in the trade balance.
A special form of quantitative restriction on imports has become widespread - voluntary export restrictions, when it is not the importing country that sets the quota, but the exporting countries themselves undertake obligations to limit exports to a given country. Several dozen similar agreements have already been concluded limiting the export of cars, steel, televisions, textiles, etc., mainly from Japan and the newly industrialized countries to the USA and EU countries. Of course, in reality, such export restrictions are not voluntary, but forced: they are introduced either as a result of political pressure from the importing country, or under the influence of the threat to apply more stringent protectionist measures (for example, initiating an anti-dumping investigation).
In principle, voluntary quantitative restrictions are the same quota, but imposed not by the importing country, but by the exporting country. However, the consequences of such a measure to restrict foreign trade for the economy of the importing country are even more negative than when using a tariff or import quota. An example is the voluntary restriction of Russian exports of unrefined uranium and steel to the United States.
Among the measures of non-tariff restrictions in foreign practice are special requirements for imported goods, established to ensure safety and protection of the natural environment, the role of which has increased significantly today. They require compliance with customs formalities - technical standards and norms, requirements for packaging and labeling of goods, sanitary and veterinary control standards. In themselves, these formalities are necessary and neutral, but they can be formulated in such a way that they either become a barrier to the entry of certain goods or serve the purpose of discrimination against certain countries.
One part of the technical barriers is a ban or restriction on the import of goods and materials that pollute the environment (chemicals, pesticides, coal and high-sulfur oil). Another part includes the expansion of protectionist measures regarding industrial equipment, vehicles and other types of products, the operation of which leads to air pollution. Finally, the latter is related to the quality of goods, and these technical barriers protect the interests of consumers, protecting them from damage caused by a defect in the product and from possible harm during use, which applies primarily to the import of household electrical appliances, medical drugs and devices, and food products , children's products. Many countries have adopted laws that impose severe sanctions on suppliers of imported goods, which are required to inform the buyer in the instructions, labeling or labeling of all possible risks associated with the consumption of the product.
To protect national producers, the state, while limiting imports, is taking measures aimed at encouraging exports. One of the forms of stimulating domestic export industries is export subsidies, i.e. financial benefits provided by the state to exporters to expand the export of goods abroad. Thanks to such subsidies, exporters are able to sell goods on the foreign market at a lower price than on the domestic market. Export subsidies can be direct (payment of subsidies to a manufacturer when it enters a foreign market) and indirect (through preferential taxation, lending, insurance, etc.).
Even the most developed countries overwhelmingly practice very strict agricultural protectionism; It is significant that in prosperous Western European countries the level of customs taxation of imported agricultural goods is now higher than in Russia. Already at the stage of creation and in the first years of the GATT - an organization designed, as is known, to ensure the liberalization of world trade - these countries agreed that their agricultural sector remained largely outside its competence. In all other serious situations, when national interests and/or national legislation came into conflict with international trade norms, these states, as a rule, found opportunities for a compromise solution. As a result, a considerable number of goods and industries were removed from the framework of “free” (with the same reservations) international trade. Many of them received government support in the form of trade restrictions or subsidies, but only for a relatively short period of time, which was necessary for domestic firms to undergo structural restructuring and adapt to the requirements of the world market, and then again entered into open competition - this is the so-called educational protectionism. Others are still under government protection.
The most protected industry is agriculture. In addition to generous subsidies for production, including in countries with very favorable climatic conditions for the development of this sector of the economy, imports are limited on a fairly large scale and exports of agricultural goods are subsidized.
“Green basket” measures to support national agricultural producers under WTO provisions include the creation of state food reserves; direct payments to producers not related to agricultural production; insurance; compensation for losses from natural disasters; payments under environmental protection programs; payments under regional assistance programs for agricultural producers, etc.
The “yellow basket” measures include targeted support for agricultural producers, payments based on the area of farmland; subsidies for inputs; preferential loans.
Blue box measures include measures that encourage a reduction in agricultural production (for example, in EU countries).
For more than three decades, the textile and clothing industries have been under the care of the state. Based on agreements on voluntary quotas by exporters of their supplies, the United States limited the import of products from these industries from 28 countries, the EU from 19, Canada from 22, Norway from 16, Finland from 7 and Austria from 6 countries. Later, Russia suffered from these restrictions imposed by the EU, despite the rather modest size of its supplies of relevant products.
At various times, Western countries introduced restrictions on the import of cars, stainless steel, machine tools, aircraft, consumer electronics, chemicals, shoes, and leather goods.
Countervailing duties as a measure of non-tariff regulation are applied to those imported goods, the production and export of which are subsidized by the exporting state, since this type of duty neutralizes export subsidies. Non-tariff regulation measures also include monetary and financial restrictions related to foreign exchange control and balance of payments regulation. Additional (in addition to duties) import taxes and import deposits also contribute to the restriction. Import deposits are a form of security that an importer must pay to his bank before purchasing a foreign product for a portion of its value.
DUMPING
A common form of competition in the world market is dumping, when an exporter sells its goods on a foreign market at a price lower than normal. Usually we are talking about selling at a price lower than the price of a similar product in the domestic market of the exporting country. Dumping can be, firstly, a consequence of government foreign trade policy, when the exporter receives a subsidy. Secondly, dumping can result from a typical monopolistic practice of price discrimination, when an exporting firm, which occupies a monopoly position in the domestic market, with inelastic demand, maximizes its income by raising prices, while in a competitive foreign market, with sufficiently elastic demand, it achieves the same result by reducing prices and expanding sales volume. This kind of price discrimination is possible if the market is segmented, i.e. It is difficult to equalize prices on the domestic and foreign markets through the resale of goods due to high transport costs or government-imposed trade restrictions.
Anti-dumping measures come down to collecting compensation from the exporter for damage to the national industry and the manufacturer, usually in favor of the latter, often in the form of an additional duty. To establish dumping, two main criteria are used: price, or cost, and economic damage.
The anti-dumping duty rate is set individually in each specific case. Such a duty is not assigned automatically: it is levied only after an investigation to confirm the fact of dumping and, what is important, to identify economic damage to the entrepreneur of the importing country.
Temporary anti-dumping duties are a kind of warning about the possibility of taking more severe measures against the exporter. Permanent measures seem to be the most serious measure, the application of which leads to significant losses for the exporter, and possibly to his complete withdrawal from the market.
Along with the listed anti-dumping measures, one is also used when the exporter undertakes to comply with the minimum price level (“normal value”) or to limit the quantity of goods supplied.
However, the problem of anti-dumping measures in world practice continues to be quite complex, and the methods of combating them remain insufficiently effective. Thus, among the dozens of anti-dumping and countervailing claims filed annually with the US Department of Commerce and the International Trade Commission, there are cases of inconsistent verdicts, rules that are easy to circumvent, and inaction of authorities in implementing decisions. This leads to undesirable economic consequences. For example, Mexico, which did not create its own television technology, for a long time supplied 70% of imported televisions to the American market at reduced prices only because it bypassed customs duties on color picture tubes introduced by the United States to combat dumping of goods from Japan, Korea, Singapore and Canada .
Claims from Western countries against those responsible for dumping pose a great threat, primarily by introducing quantitative restrictions on such exporters.
An extreme form of government restriction of foreign trade are economic sanctions. These include a trade embargo - the introduction by a state of a ban on the import into or export of goods from a country, usually for political reasons. But economic sanctions against a country can also be of a collective nature, for example, when they are imposed by decision of the UN.
International foreign trade
International (foreign) trade is trade in goods and services between countries.International (foreign) trade is necessary for most countries, both economically and socially. It is vital for solving the fundamental questions of any economy: What to produce? How to produce? For whom to produce? Foreign trade promotes more efficient use of both domestic resources and resources belonging to other countries in order to more fully satisfy the unlimited needs of the population at home and abroad. Moreover, changes in net exports (the difference between exports and imports) can have a significant impact on domestic production and income levels.
Foreign and domestic trade differ from each other in that:
A) resources at the international level are less mobile than within the country;
b) in internal trade, each country uses its own currency, and in external trade - the world one;
c) foreign trade is more subject to political control.
What is the basis of trade between countries? Answer: The international division of labor, through which countries can develop specialization, increase the productivity of their resources, and thus increase overall output. Sovereign states, like individuals and regions of a country, can benefit by specializing in items that they can produce with the greatest relative efficiency and then exchanging them for items that they cannot produce efficiently themselves.
In answer to the question “Why do countries trade?” there are three circumstances:
1. Economic resources - natural, human, investment goods are distributed extremely unevenly between countries of the world; Countries differ significantly in their endowment of economic resources.
2. Efficient production of various goods, taking into account the use of advanced technologies or combinations of resources.
3. Maximum satisfaction of the unlimited needs of all living on Earth.
The nature and interaction of these three circumstances can be illustrated. Japan, for example, has a large and well-educated workforce; skilled labor is cheap because it is available in abundance. Because of this, Japan is able to efficiently produce (at low costs) a variety of goods that require large amounts of skilled labor to produce. Cameras, radios and video recorders are just a few examples of such labor-intensive products. In contrast, Australia has vast expanses of land, but insufficient human resources and capital, and therefore can cheaply produce such “land-intensive” goods as wheat, wool, and meat. Brazil has fertile soil, a tropical climate, high rainfall, and an abundance of unskilled labor, which is everything needed to produce cheap coffee.
Industrialized countries are in a better strategic position to produce a variety of capital-intensive goods, such as automobiles, agricultural equipment, machinery, and chemicals. The economic efficiency with which countries are able to produce various goods can and does change over time. For example, Russia, which half a century ago exported mainly agricultural goods and raw materials, now exports manufactured products. Shifts in the distribution of resources and technology can lead to shifts in the relative efficiency of producing goods in different countries. For example, new technologies that facilitated the development of synthetic fibers and artificial rubber radically changed the structure of resources needed to make these goods and thus changed the relative efficiency of their production. In other words, as national economies evolve, the quantity and quality of labor, the volume and composition of capital may change.
Mutually beneficial specialization and trade between any two countries is possible as long as the internal cost ratios for any two products are different. By specializing in a particular production, in accordance with comparative advantages, countries can receive large real incomes with fixed amounts of resources. The terms of trade determine how this increase in world output will be divided among trading countries. Rising costs limit the benefits of specialization and trade.
Trade barriers come in the form of protective tariffs. Analysis of supply and demand finds that protective tariffs raise prices and reduce the volume of goods subject to tariffs. Foreign exporters are losing from reduced sales of their goods. Domestic producers, however, benefit from rising prices and increased sales volumes. Thus, tariffs lead to less efficient allocation of domestic and global resources.
In certain cases, the strongest arguments in favor of protective measures are references to the underdevelopment of national industry and the need for self-sufficiency in defense industries. Proponents of protectionism tend to emphasize the immediate effects of trade barriers and ignore the long-term consequences. Critics of protectionism argue that free trade stimulates economic growth, but protectionism does not contribute to this process.
In recent years, some countries, especially those with economies in transition, have seen a resurgence of protectionism.
Economic integration is an important means of trade liberalization. The most striking example is the European Community, formed from three communities: the European Economic Community EEC, or “Common Market”, the European Atomic Energy Community Euratom and the European Coal and Steel Community ECSC, which has abolished internal trade barriers and applies a common system of duties on developing countries and provides for freedom of movement of labor and capital.
The General Agreement on Tariffs and Trade (GATT) was created:
A) to encourage the application of a non-discriminatory regime for all trading countries;
b) to reduce the level of duties;
c) to eliminate import quotas.
Economics of foreign trade
Foreign trade is a country's interactions with foreign countries regarding the movement of goods and services across national borders.Foreign trade allows the state to:
A) receive additional income from the sale of national goods and services abroad;
b) saturate the domestic market;
c) overcome the limited national resources;
d) increase labor productivity by specializing in world trade in the supply of certain products to the world market.
Foreign trade is characterized by the concepts of export and import: the first involves the export of goods and services abroad and receiving foreign currency in return, and the second involves their import from abroad with the appropriate payment. Exports, like investments, increase aggregate demand in the country and drive the foreign trade multiplier, creating primary, secondary, tertiary, etc. employment. An increase in imports limits the effect of this effect due to the outflow of financial resources abroad.
Foreign trade is organized on the principles developed and enshrined in the General Agreement on Trade and Tariffs (GATT). It was replaced by the World Trade Organization (WTO), which takes a broader view of foreign trade, including the exchange of goods and services and the purchase and sale of intellectual property.
The theory of comparative advantage. Export in foreign trade, according to A. Smith, becomes profitable if the costs of producing goods within the country are significantly lower than in other countries. In this case, the goods produced by the national economy have absolute advantages over foreign competitors and can be easily sold abroad. On the other hand, no state can have an absolute advantage in all produced goods; therefore, it is necessary to import those that are more expensive within the country and cheaper abroad. Then, at the same time, there is direct benefit from both exports and imports.
Based on the absolute advantages of A. Smith, D. Ricardo formulated the theory of comparative costs (advantages), according to which, when determining the profitability of foreign trade, one should compare not the absolute, but the relative effect, and not the costs themselves, but their ratios. At the same time, it must be taken into account that by producing certain goods in conditions of limited resources, the country is deprived of the opportunity to produce others that are no less necessary for it, therefore, in accordance with Ricardo’s theory of comparative advantage, a situation is quite possible in which it is profitable for the country to import goods, even in the case if their production within the country is cheaper. In this case, Smith's theory of absolute costs becomes a special case of the theory of comparative costs.
Ricardo's theory of comparative costs in modern conditions is supplemented by the Heckscher-Ohlin theory, named after two Swedish economists who proved that countries strive to export not only goods that have absolute and relative advantages, but also goods in the production of which relatively redundant factors of production are intensively used, and they import goods for the production of which there is a shortage of factors in the country. Unlike A. Smith and D. Ricardo, their modern followers believe that both sides benefit from foreign trade - both the country and the rest of the world.
Forms of foreign trade
1. Trade in finished products does not exclude the performance of additional work that increases the competitiveness of the product.These types are:
Pre-sale service - (does not change the technical characteristics of the product) re-preservation of the product after transportation, giving it a marketable appearance and bringing the product to a state where it is finally ready for use or use.
- Pre-sale refinement – to meet individual consumer requests.
- Maintenance.
2. Sale of products in disassembled form. It is used to increase its competitiveness in foreign markets and to obtain additional rights for suppliers compared to sales of finished products. Machines, equipment, building structures, etc. are most often exported in disassembled form. Developing countries use this form to protect national sectors of the economy from competition from foreign suppliers; they introduce bans, quotas, and increased customs duties on the import of finished products, and on the import of disassembled products. form establishes reduced customs duties.
Additional requirements for disassembled products:
Products should be divided into such units and parts, the assembly of which will correspond to the level of qualifications available to the country's workers and can ensure high quality of the assembled products;
- the precision of manufacturing of individual components should completely eliminate adjustment during assembly;
- division into nodes should take into account savings on transport costs;
- timely delivery of parts should ensure the rhythm of assembly production;
- warehouses for components and parts abroad should be optimal.
3. Rental of machinery and equipment has been widely used in the USA since the 50s and there are 3 types:
Leasing is a long-term lease (from 6 months to several years) of machinery, equipment, vehicles, and production facilities, providing for the possibility of their subsequent purchase by the lessee;
- Hiring is a form of leasing, medium-term rental of machinery and equipment without transferring ownership of the leased property to the lessee;
- renting - short-term rental of machinery and equipment without the right of subsequent purchase by the lessee, differs from leasing by a higher level of rent.
4. Countertrade – foreign trade operations, during which agreements or contracts fix the commodity obligations of exporters and importers to carry out a full or partially balanced exchange of goods. This is a way to save foreign exchange funds and a way to enter domestic markets with products that are difficult to export by conventional methods.
Barter is a non-currency but valued exchange of goods. The valuation of goods in barter transactions is divided to ensure the equivalence of the exchange. A guarantee of equivalence can be the use of world prices;
- counter-purchases – purchases made by exporters in partial payment for goods sold. They are carried out against the obligations assumed by exporters in contracts for the sale of basic goods. In most cases, exporters are forced to accept reciprocal purchase obligations under pressure from importers;
- repurchase of obsolete products. Widely used in the field of industrial equipment: metalworking equipment, redemption of passenger airliners, sea vessels. When a client purchases a new car, the price of the old one is deducted from its cost (trade in). The company has developed special markdown tables depending on the year of manufacture, mileage and technical condition;
- operations with customer-supplied raw materials - under this contract, one of the parties undertakes to export raw materials and import processed products or finished products. The other party undertakes to process the raw materials using its own means. Payment for the services of processing companies is carried out by supplying additional quantities of customer-supplied raw materials;
- compensation transactions - obligations of foreign partners to buy products to repay financial or commodity loans.
5. Trade in cooperative products.
Production cooperation - when components and parts of the cooperated products are manufactured not for the market as a whole, but according to the instructions of those. the requirements of specific customers of foreign trade contracts that formalize the supply of such products are of a contractual nature. Contracts may provide for joint development of machine designs, production and supply of cooperative parts according to technical specifications. customer documentation. Suppliers can produce cooperative products both from their own materials and from materials and semi-finished products of customers;
- sales cooperation - cooperation of economically independent producers who invest in joint activities for the marketing of their products, conduct joint advertising campaigns, prepare common technical and economic proposals, use each other’s sales networks and create joint sales ventures;
- production and sales cooperation - when companies producing various types of products not only complement each other in the market, but also organize sales of products that are the result of production cooperation (machine tool industry, aircraft manufacturing, automotive industry).
6. Trade within a consortium (temporary union of economically separate entities). It is created to increase the technical and commercial competitiveness of the products of companies participating in the competition for large orders.
Goals of the consortia:
1. increasing competitiveness through sharing the best design and technical solutions of partners;
2. increasing technical and commercial competition through separate production of products between partners, taking into account their experience, technical equipment, etc.;
3. increasing commercial competition due to partners mobilizing their credit capabilities.
The initiator is often an engineering firm. Consortium members are economically isolated. They have joint responsibility.
The transaction is based on the purchase and sale of goods in tangible form: the seller undertakes to transfer the goods into the ownership of the buyer within specified periods and under certain conditions, and the buyer undertakes to accept the goods and pay the agreed amount of money for it.
The methods vary depending on the distribution channel and the nature of the relationship between the parties:
Direct (there are no intermediaries between the seller and the buyer);
- indirect (through intermediaries).
Direct method. This method is suitable for companies that have been on the market for a long time and have a fairly large sales volume.
Advantages of the direct method:
1) financial benefit, which consists in reducing costs by the amount of commission to the intermediary (increasing profitability);
2) reduced risks and dependence on additional trading participants (it is easier to control the progress of implementation);
3) the possibility of obtaining information about the sale of goods (direct contact).
Indirect method. Indirect: producer---intermediary---consumer. This method allows you to oust competitors from the market who work with the same intermediaries on more favorable terms.
It is advisable:
For a narrowly segmented market and individual non-regular customers;
- when entering new markets (when the company does not have its own distribution channel and when there is strong competition in the market).
Intermediary operations are carried out on the basis of agency agreements, agency agreements, commission agreements, consignment agreements, simple intermediary agreements and distribution agreements.
An intermediary agreement is an agreement concluded between the intermediary and the principal. The principal can be sellers, buyers, suppliers, customers, lessors.
Under a contract of agency, the attorney undertakes to perform, on his own behalf and at the expense of the principal, certain actions related to foreign trade, purchase and sale. Remuneration is a percentage of the cost of goods sold. Intermediary operations: during sales (agents, distributors, consignors) and during negotiations (simple intermediary, attorney, commission agent).
Commission form - when foreign economic organizations carry out commission orders from various legal entities for the purchase of imported goods abroad and for the supply of export goods abroad. They study the market, conduct advertising, create a sales network and a technical service network. They enter into transactions on their own behalf, but at the expense of the seller or buyer.
The Importance of Foreign Trade
International trade is an important means of developing the national economy, since with its help it increases labor productivity and increases the total volume of production. Countries that export their goods to other countries receive significant economic benefits through the development of specialized industries, which are comparatively more efficient than countries producing similar products.The principle of comparative advantage states that total output will be greatest if each good is produced at a lower total cost of production compared to the country into which the good is imported. And this is natural, since it is more profitable to buy a product from another country than to organize your own production, which will require large expenses for a similar product.
Thanks to international trade, the world economy can achieve a more efficient allocation of resources and a higher level of material well-being of the people. Each country must produce those goods whose production costs are relatively lower than the costs of other countries, and exchange the goods in which it specializes for products whose production costs are lower in the country compared to the entire country. If every country does this, the world can take full advantage of geographic and human specialization.
In addition to the indicated benefits from international trade, one should also point out the side benefits that the country receives from the international division of labor. Free international trade stimulates competition and limits the dominance of monopolies. Increasing competition from foreign firms is forcing local firms to switch to production technologies that provide the lowest costs for creating the corresponding goods. Of course, the transition to new technologies involves the use of the latest achievements in the field of science and technology, which generally contributes to improving the quality of products, increasing labor productivity, and the economic development of the country as a whole. The free international exchange of goods provides consumers with the opportunity to choose or a wider range of goods, replenishing store shelves with a wide variety of goods produced in a wide variety of countries around the globe.
Thus, it can be stated that international trade is vital for all countries without exception, including the most developed ones.
For example, even for a country like the United States, international trade is vital for the following reasons:
1. The absolute volumes of American foreign trade exceed the exports and imports of any other country.
2. For certain types of goods and materials that the United States cannot or does not profitably produce domestically, it depends on international trade.
3. Changes in the volume of exports and imports can have a significant impact on the level of domestic production and income.
The volume of net exports is an important economic indicator of the effectiveness of countries' foreign economic activities. The value of net exports is the difference between the value of a country's exports and its imports. This value has a multilateral impact on the level of national income, such as the influence of fluctuations in various types of domestic expenditures. Even small changes in the volume of imports and exports can cause large shifts in income, employment, and price levels within a country.
International and domestic trade have their own specific differences. These differences lie in the fact that economic resources are distributed unevenly between countries; each country uses its national currency in its foreign economic activities. International trade is most subject to political control by the various branches of government in a country.
Restriction of foreign trade
Non-tariff trade regulation means the use of various foreign trade regulation instruments other than customs duties. These include: quotas, licensing, voluntary export restrictions, export subsidies, administrative and technical barriers, etc.Quotation of foreign trade supplies means limiting export and/or import supplies by the number of goods (quantitative quotas) or their total value (cost quotas) for a specified period of time.
Quotas are allocated:
The general quota (global quota) is determined for government needs;
- Natural quota - associated with the limited capacity of oil pipelines, terminals in ports, etc.;
- Exclusive quota - is introduced in special cases related to ensuring the national security of the state, protecting the domestic market, and fulfilling international obligations.
- Tariff quota is a permit to import a certain amount of goods into a country duty-free or at reduced rates; Goods imported in excess of this limit are subject to customs duties at normal rates.
- An export quota limits the amount of products allowed for export.
- Import quotas limit the quantity of products allowed for import.
- Licensing is a restriction in the form of obtaining the right or permission (license) from authorized government bodies to carry out specific export and/or import transactions. The license itself may establish the procedure for the import or export of goods. The license may also contain permission to import (export) a certain volume of goods - in this case, licensing is closely related to quotas. Licensing can be an integral part of quotas or be an independent instrument of state regulation.
A quota imposed by the exporting country rather than the importing country is called a voluntary export restraint. It can be imposed through, for example, persuasion or the threat of sanctions; This form of settlement only outwardly appears voluntary.
An export subsidy refers to the provision by the government or government agency of a country of financial assistance to enterprises and sectors of the economy on its territory to support domestic exporters and indirectly discriminate against foreign importers.
An extreme form of government restriction of foreign trade are economic sanctions, for example, a trade embargo - a state prohibition of the import into or export of goods from any country.
A common form of administrative measures to control foreign trade are declarations, visas, and permits. Technical barriers include requirements for compliance with national standards, obtaining quality certificates for imported products, specific packaging and labeling of goods, compliance with certain sanitary and hygienic standards, etc.
Foreign trade in services
In the modern world, the service sector is becoming increasingly important. The area of foreign trade is no exception. Thus, the special role of foreign trade is emphasized in the preamble of the General Agreement on Trade in Services (GATS), concluded within the framework of the World Trade Organization in Marrakech. It states that GATS members recognize the growing importance of trade in services for the growth and development of the world economy.The General Agreement on Trade in Services (GATS) is a multilateral agreement that provides the main legal framework for trade in services within the World Trade Organization. A characteristic feature of this agreement are special proposals to it, which are intended to specify and supplement individual provisions of the GATS. The GATS contains general norms and obligations for individual sectors and types of services, which are mandatory for all participating countries, and are recorded in separate lists.
The GATS structure includes 6 parts and annexes:
Scope of application and definitions,
- general obligations and rules,
- specific obligations,
- gradual liberalization,
- institutional provisions,
- final provisions,
- applications.
In the GATS, trade in services is understood as the supply of services:
- a service provider of one WTO member through a commercial presence in the territory of any other WTO member;
- a service provider of one WTO member through the presence of individuals of a WTO member in the territory of any other WTO member;
- from the territory of one WTO member to the territory of any other WTO member;
- on the territory of one WTO member to a consumer of the services of any other WTO member;
- a service provider of one WTO member through a commercial presence in the territory of any other WTO member.
In Art. 2 of Federal Law No. 164-FZ “On the Fundamentals of State Regulation of Foreign Trade Activities” establishes the definition of the concept of “foreign trade in services”, which is the provision of services (performance of work), including production, distribution, marketing, delivery of services (work) and in the ways specified in Federal Law No. 164-FZ “On the Fundamentals of State Regulation of Foreign Trade Activities”.
Within the framework of this definition, two concepts were used - work and service, which are actually recognized as identical within the framework of the given definition.
Foreign trade in services can be carried out in various ways. Their list is contained in the commented article: from the territory of the Russian Federation to the territory of a foreign state.
In accordance with Art. 69 of the Constitution of the Russian Federation, the territory of the Russian Federation includes the territories of its subjects, internal waters and territorial sea, and the airspace above them.
The length of Russia's territory from north to south exceeds 4,000 km, from west to east - close to 10,000 km. The total length of Russia's borders is 60,933 km (of which 38,808 km are maritime borders); Russia's borders in the north and east are maritime, in the south and west they are mainly land. Borders with: Kazakhstan (6846 km), China (3645 km), Mongolia (3485 km), Ukraine (1576 km), Finland (1340 km), Belarus (959 km), Georgia (723 km), Estonia (294 km) , Azerbaijan (284 km), Lithuania (280.5 km), Poland (232 km), Latvia (217 km), Norway (196 km), North Korea (19 km).
The territory of a foreign state is a certain territory over which the sovereignty of a particular state extends:
From the territory of a foreign state to the territory of the Russian Federation;
- on the territory of the Russian Federation to a foreign customer of services.
Foreign customer of services - a foreign person who ordered services (work) or uses them on the territory of a foreign state to a Russian customer of services.
Russian customer of services is a Russian person who ordered services (work) or uses them.
A Russian service provider who does not have a commercial presence in the territory of a foreign state, through the presence of him or persons authorized to act on his behalf in the territory of a foreign state.
Russian service provider is a Russian person providing services (performing work). Commercial presence - any form of organization of entrepreneurial and other economic activity of a foreign entity on the territory of the Russian Federation or a Russian entity on the territory of a foreign state permitted by the legislation of the Russian Federation or the legislation of a foreign state for the purpose of providing services, including by creating a legal entity, branch or representative office of a legal entity or participation in the authorized (share) capital of a legal entity. A Russian legal entity through which a commercial presence is carried out is considered as a foreign provider of services if the foreign person (foreign persons), by virtue of a predominant participation in the authorized (share) capital of the Russian legal entity, either in accordance with an agreement concluded between them, or otherwise has the ability to determine decisions made by a Russian legal entity.
In international practice, the classification of services created for the purposes of the GATS and prepared by the GATT Secretariat on the basis of the Unified Product Classification developed by the UN is widely used. This classification includes 12 groups of services, and the total number of types is more than 160.
The following main types of services are distinguished:
Business services;
- communication services;
- construction and engineering services;
- distribution services;
- general education services;
- environmental protection services;
- financial services, including insurance;
- health and social services;
- tourism and travel;
- services in the field of organizing leisure, culture and sports;
- transport services;
- other services.
Federal Law No. 164-FZ “On the Fundamentals of State Regulation of Foreign Trade Activities” does not provide a classification of types of services. Therefore, within the framework of this article, when identifying types of services, statistical reports from the Bank of Russia on foreign trade in services were used.
Thus, the following services were defined:
Transport services,
- trips,
- communication services,
- construction services,
- insurance services,
- Financial services,
- computer and information services,
- royalties and license payments,
- other business services,
- services in the field of culture and recreation,
- government services.
When preparing statistical reports, an expanded classification of services according to the balance of payments methodology is used. Foreign trade in services may be limited by introducing prohibitions and restrictions affecting all or individual service sectors regarding the methods of providing services on the basis of federal laws and other regulatory legal acts of the Russian Federation. However, such restrictions can be introduced only if otherwise is not provided for by international treaties of the Russian Federation.
Definition 1
Foreign trade is trade between any countries in goods or services, consisting of paid imports and exports.
In turn, international trade is a form of exchange of products and services among different countries, associated with the general internationalization of economic life, the intensification of the division of labor in the conditions of the scientific and technological revolution.
The role and importance of foreign trade
Foreign trade involves the interaction of countries among themselves within the framework of the movement of goods (services) across established state borders. Foreign trade gives a particular state a number of advantages.
- The state receives income, which is considered additional, from the sale of goods or services in the territory of other states;
- Foreign trade in goods and services allows the state to expand the domestic market for its goods and services;
- This type of trade allows the state to obtain those national resources that are located on the territory of the state in limited quantities;
- If a state supplies a product or service within the global market, this provides an additional opportunity to increase labor productivity in that state.
Export and import of goods
Export of goods involves the removal of goods or services from the country to foreign markets, for which the state receives income in foreign currency. By increasing the share of exports, the state thereby increases aggregate demand in its country, which is similar to the investment process, thereby increasing employment in its state.
Definition 2
Import is the opposite concept of export, when a foreign product or service is imported into the territory of a state with subsequent payment for this product (service). Imports reduce employment and reduce aggregate demand in the country, which is due to the outflow of capital from the country.
In 1947, a trade and tariff agreement was developed, which established the general rules and principles of foreign trade throughout the world. Today, this document has been replaced by the World Trade Organization, formed in 1996. This organization not only forms the basic principles and rules of foreign trade, but also expands its sphere of influence by regulating the processes of purchase and sale, including not only goods and services, but also intellectual property.
Is foreign trade profitable?
This question was once answered by A. Smith, who formulated the theory of comparative advantage. This theory states that the export of goods or services becomes profitable for the state only if the costs of producing this product or service in the producing country are much lower than in other countries. If a state releases a product on a foreign market at a price relatively lower than that of its competitors, therefore, such a product or service has a comparative advantage, which indicates its successful sale on the world market.
A. Smith also noted that the state cannot be the leader in production on the world market for all goods; therefore, it makes sense to import only those goods or services whose production is cheaper abroad than in the territory of one’s own country.
If this theory of comparative advantage is observed in the state, then benefits will come from both imports and exports.
Note 1
Thus, foreign trade is an integral element of trade of any modern state. Some states work more for export, others for import, but foreign trade is carried out in any case as an obligatory element of the country's foreign policy.
1. The concept of foreign economic policy
Foreign economic activity is one of the fastest growing sectors of the domestic economy. It includes foreign investment, currency, customs, migration and foreign trade policies. Foreign investment includes the policy of importing foreign investment and the policy of exporting national investment. The foreign exchange policy consists of discount and reversion policies, foreign exchange subsidies and diversification of foreign exchange reserves. The activity of migration policy is to control emigration and migration into our country. Customs policy makes it possible to trace all cargo flows, and customs authorities also establish various methods for regulating global trade.
International trade is the process of buying and selling between buyers, sellers and intermediaries in different countries. International trade includes the export and import of goods, the relationship between which is called the trade balance.
The meaning of inclusion in international trade is that international trade determines the continuation of the process of selling products for the domestic market. By exporting goods abroad, the country finds additional markets, ensuring full sales of the created products.
Moreover, exports can provide even greater income than sales of these products on the domestic market. By exporting products abroad, the country receives payment for this in currency, which constitutes the material basis for the purchase of any goods in other countries.
Importing goods from abroad makes it possible to obtain products that are not produced in the country at all, or those products whose domestic production costs exceed the costs associated with paying for imports. Imports of goods directly affect the physical volume and structure of the country's national income.
Foreign trade, to one degree or another, provides an additional effect for the development of any national economy. Therefore, all countries are involved in the international division of labor and commodity exchange, but the degree of inclusion of the national economy in international trade is different.
Foreign trade theories make it possible to develop, on a scientific basis, a trade strategy that meets the individual conditions and goals of a particular country and has a significant impact on international business; develop an intuitive ability to identify favorable markets.
Theorymercantilism: the wealth of a country was measured by the possession of valuables, usually in the form of gold (exports exceeded imports). Currently, the term neomercantilism is used in relation to countries that are clearly trying to have a trade surplus.
Modern theories of international trade originate from the theories of A. Smith and D. Ricardo.
A. Smith substantiated the thesis according to which the basis for the development of international trade is the difference in absolute costs of producing goods in different countries: some countries can produce goods more efficiently than others ( theoryabsolute advantage).
Some modern research, based on the theory of absolute advantage, has taken shape in theorycountry size, which takes into account the differences between countries in their production specialization and helps explain in what volume and what type of products need to be involved in trade.
D. Ricardo belongs theoryrelative advantage. He proved not only the possibility, but also the necessity of mutually beneficial trade, even if there is an absolute advantage of one country in the production of all products: this country will gain if it abandons the less efficient in favor of the more efficient.
A modern modification of the theory of comparative costs is theoryratios of production factors. If a country is abundantly provided with some factor, for example, labor with relatively lower wages, then labor goods produced in that country will be cheaper. This model is often called the Heckscher-Ohlin-Samuelson model.
According to the model classificationswork force production involves not three factors, but four: skilled labor, unskilled labor, capital and land.
The leading place among neoclassical theories of international trade is occupied by modelopportunity costs G. Haberler. For each country, he proposes production possibility curves that show the ratios in which each country can produce two goods using all its resources and the best technology.
According to theorieslife cycle (LCT) by Raymond Vernon, Some products go through a four-stage cycle (introduction, growth, maturity, decline), and their production moves internationally depending on the stage of the cycle.
According to theoriessimilarities of countries, a large share of foreign trade today is trade in manufactured goods between industrialized countries because they have similar market segments.
2. Trade structure
2.1 Export
Despite the fact that the foreign economic sphere of the Russian Federation is the most growing sector of the country's economy, there are a number of problems in this sector. The main exporters and importers in our country are only a number of the most developed subjects of our federation.
The situation in the Russian export sector is characterized by a number of clearly defined trends both in the commodity structure and in the geographical focus.
As modern trends in commodity exports of the Russian Federation, it is necessary to highlight the following:
1.The clearly expressed fuel and raw material orientation of Russian exports remains.
2. Due to the unfavorable conditions on the world markets for non-ferrous metals, the share of exports of non-ferrous and ferrous metals decreased slightly. Nevertheless, ferrous and non-ferrous metallurgy products remain an important item of Russian export.
3. There was also a reduction in export supplies of products from the chemical and petrochemical industries, forestry, wood processing and pulp and paper industries.
4. The focus on raw materials leads to a high dependence of Russian exports on price fluctuations on world commodity markets.
5. Russia's international specialization in semi-finished products produced in industries that have the greatest negative impact on the environment (metallurgical, chemical and petrochemical, pulp and paper) has significantly worsened the environmental background of foreign trade.
6. The share of machinery, equipment, and vehicles is steadily decreasing.
Since the isolation of the Russian Federation and the beginning of economic reforms, certain changes have occurred in the geographical focus of Russian exports. Russia's main trading partners are the CIS countries (Belarus - 6.5%; Ukraine - 6.3%), the EU. Among non-CIS countries, the leading position is occupied by Germany - 9.7%; Italy - 5.7%; Netherlands - 5.2%; Switzerland - 3.3%; Finland - 3.2%. Russia's important trading partners are China - 6.1%; Poland-3.3%; USA - 3.7%.
In order to overcome the identified negative trends in Russian exports, the Government of the Russian Federation adopted a number of legislative acts that contribute to the formation of a rational export structure. The most comprehensive of them was the “Federal Export Development Program” dated 02/08/96, focused on manufacturing industries and envisaging an increase in the share of finished products in Russian exports to 40% in 2005. The implementation of the program, given the acute shortage of necessary financial resources in the budget, immediately came to a standstill. In the year the program was approved, a little more than 110 billion rubles were spent from the budget for the purposes envisaged in it. instead of the planned 900 million dollars. In 1997, no budgetary funds were allocated at all to stimulate and support exports, and the consequences of the financial crisis of 1998 actually eliminated the possibility of further implementation of the program. But the failure of the Federal Export Development Program is explained not only by the state’s refusal to finance it. The main reason is that in the country, as in Soviet times, problems of a general economic nature related to the restructuring of the deformed structure of the national economy, its technical re-equipment based on the achievements of scientific and technological progress and increasing the competitiveness of production were not solved.
2.2 Import
The situation in the import sector of the Russian Federation is also characterized by a number of features. The following trends are noted in the commodity structure of Russian imports:
1. The main items are machinery and equipment, food products, products of the chemical and petrochemical industries, ferrous and non-ferrous metallurgy, consumer goods (clothing, shoes, etc.) and so on.
2. Imported machinery and equipment are intended for the textile, clothing, leather, footwear and fur industries. The need to import these goods is due to the lack of production of equipment for most civilian sectors of the economy, which creates the need for irrational imports.
3. Imports under the heading “Food” are also irrational: having enormous agricultural resources and creating a system of state support for the agricultural sector, Russia could solve the problem of food self-sufficiency.
4. There is a reorientation towards the import into the Russian market of cheaper goods of lower quality that have not found demand in industrialized countries.
Characterizing the geographical structure, it should be noted that industrialized countries account for more than half of Russian imports, developing countries account for 13%; countries of the former CMEA - 8.5%; CIS-12%.
In recent years, a lot of work has been done to form a legal framework for international cooperation between the Russian Federation and other countries: 35 international agreements have been signed with 22 countries and the EU (Russia signed a Partnership and Cooperation Agreement with the EU in June 1994).
2.3 Russian Federation in the global technology market
The international exchange of scientific and technical knowledge for Russian enterprises and organizations consists, on the one hand, in the possibility of using world scientific and technical experience and increasing the technical level of domestic production on this basis, and on the other hand, in the possibility of commercial sales of their own scientific and technical knowledge on world markets. technical achievements, which, given the raw material orientation of Russian exports, is an effective way to rationalize the structure of foreign economic relations.
The intellectual potential of our country is recognized as one of the highest in the world.
The indisputable advantages of the Russian Federation in the global arms and military equipment market. First of all, this applies to MiG-29 and MiG-31 fighters, SU-24 and SU-27 fighter-bombers, MI-28 and MI-34 helicopters, AN-124 transport aircraft, and tanks.
Thus, Russia, with its enormous scientific and technical potential and highly professional engineering and technical personnel, has every reason to become an equal partner of industrialized countries in the field of international scientific and technical exchange and compete with them on equal terms.
At the present stage, three main areas of scientific and technical cooperation between the Russian Federation and Western countries can be distinguished:
1.Multilateral interstate cooperation. Today our country participates in such international scientific and technical programs as Copernicus, Eureka, Intas together with the EU Commission; in the program carried out by the UNECE - "Energy saving and energy efficiency".
2. Bilateral cooperation is the main form of scientific and technical cooperation. The most developed legal framework for relations with the United States includes “Acoustic thermometry of the ocean climate”, “Study of the fundamental properties of matter”, etc. The largest volume of scientific and technical programs is being implemented with Germany, the USA, and Italy.
3. Almost all scientific and technical contacts in our country are based on direct connections: institute-institute, laboratory-laboratory, scientist-scientist, scientist-customer. Because of this, there is a "brain drain". As a rule, the most qualified and gifted scientists go abroad.
In addition, various organizations and foundations provide assistance to the development of Russian science. Thus, in the early 90s, two international organizations were specially created:
1. The Brussels Association for Stimulating Cooperation with CIS Scientists, created in July 1993, supports fundamental research through a system of guarantors.
2. Technical assistance to the CIS countries (TACIC, established in 1994) is financed from the EU budget. TACIS provides consulting assistance, expert assessments, transfer of know-how, etc.
At the same time, the USA, Germany, France, Japan and other industrialized countries organized various funds, stimulating scientific and technical activities in Russia and attracting leading Russian specialists for research.
3 . Methods of regulating foreign trade
The state has always sought to regulate relations in the foreign market, to use them for political purposes, connecting them with the objectives of foreign policy. Objective laws of market development are used in specific socio-political conditions. With the help of the state, an economic policy is developed that directly serves the interests of certain social forces. Its organic component is foreign trade policy as a system of government measures to regulate and manage foreign trade activities.
There are two main types of foreign trade policies:
1.Freetrading.
2.Protectionism.
Free trade policy means that the state uses a system of trade and political measures that allow the free export and import of goods. But this does not mean the absence of a regulatory role for the state. The state is pursuing a conscious policy to create favorable conditions in the domestic market for imported goods imported without significant restrictions. Supporters of market conservatism defended freedom of trade, because it embodies all the laws of a market economy in their original form, self-regulation of economic relations. Free trade stimulates competition and limits monopoly. Freedom to import products from abroad is powerful competition for their own production, forcing manufacturers to reduce production costs and make full use of the achievements of scientific and technological progress.
In contrast to free trade, there is another type of foreign trade policy - protectionism.
It is characterized by the presence of significant import restrictions and is aimed at protecting national production from competition from cheaper foreign goods.
The main reasons for following protectionist policies:
1. Preservation of industries necessary for the state that ensure the military-political and economic security of the country.
2.Protecting young industries from the destructive effects of foreign competition.
3. Ensuring stable employment in the national economy.
The choice of the type of foreign economic policy should actively contribute to strengthening the country’s position in the system of world economic relations. It is precisely this task that today must be subordinated to the mechanism of state regulation of Russia’s foreign economic relations. It is necessary to ensure an optimal combination of free trade and protectionism, taking into account the specifics of the state of its economy and the potential of world economic relations.
The experience of recent years has shown that the interpretation of free trade as accelerated liberalization (this is how it is viewed in the course of Russian reforms) can and is already leading to negative consequences: a decrease in domestic industrial potential; destruction of industries and individual enterprises; conservation of imbalances in the structure of the national economic complex; increasing financial and technological dependence on industrialized countries; a decrease in the “quality” of the structure of domestic exports and imports; loss of part of the domestic market by national producers, etc.
With trade liberalization, a decrease in employment may occur in the short term due to weakening incentives for the development of both import-substituting industries and, possibly, industries that are not directly involved in foreign trade, but may depend on liberalization processes. And even a sharp increase in employment in the export sector cannot immediately compensate for its decline in other areas. Export-oriented enterprises do not have time to absorb the labor released from other sectors, for example, due to the lag of new investments or slow professional reorientation and limited mobility of labor resources.
The implementation of the free trade model in its pure form in transition economies is difficult. Post-socialist countries entered into competition in the world market under unequal conditions compared to developed countries. The experience of implementing this model in some developing countries has shown that the result of such a strategy is the preservation of the dependent position of national economies, the outflow of investment and qualified personnel.
However, it should be noted that the weakening of protectionism in these countries, expressed in the creation of equal conditions for importers and exporters, in the reduction of foreign trade restrictions and the use of the price mechanism instead of arbitrary decisions of the bureaucratic apparatus, led to an increase in GDP growth rates, which was the result of the redistribution of resources to more efficient production. Thus, in the countries of the Asia-Pacific region, after the start of economic reform and liberalization of foreign trade, the annual GDP growth amounted to 5-6%, and foreign trade - 9-10%.
To regulate foreign trade, the state uses methods that can be divided into tariff (customs tariffs) and non-tariff (quotas, licenses, subsidies, dumping). Protectionism is often implemented to supplement government revenues. Customs duties are easier to collect than taxes, but budget revenues in this case will depend on the elasticity of demand for imports. However, the more elastic demand is, the more government revenue increases as protectionism weakens. Almost always, the policy of protectionism pursued by one state causes a response from others. Economic contradictions between countries can worsen and lead to negative consequences for each of them, in particular, to a deterioration in the balance of payments of a particular country.
Due to the peculiarities of the economic situation and traditions in the field of government regulation, Russia has to resort to both tariff restrictions and non-tariff restrictions - quotas and licensing. In fact, this means pursuing a policy of fairly strict protectionism, which is reflected in the mechanism of administrative control of foreign trade activities, in methods of stimulating exports and import substitution, in foreign exchange regulation and control.
By purposefully applying customs duties and other protectionist measures, the state can stimulate the development of certain sectors of the economy, weakening competition from foreign goods. However, this protection can also have the opposite effect. By protecting the manufacturer with excessively high barriers (customs or other), it can deprive him of the incentive to improve production and reduce costs, which ultimately leads to the preservation of technical backwardness. Such a policy will not benefit either the Russian national economy as a whole, or the overly protected industries themselves.
A clear example is the situation at VAZ. The introduction of practically prohibitive duties on imported cars in the fall of 1993 allowed automakers to raise prices for their products, which were far from being of the best quality, to a critical level. At the same time, the plant exported cars at prices lower than domestic ones, making significant profits in the face of the constant depreciation of the ruble, which, however, was not aimed either at reconstructing production or at producing new, competitive models, samples of which were exhibited in car showrooms. The growth of the ruble exchange rate, and later the introduction of a currency “corridor” led to the fact that the imaginary advantages were lost, and VAZ found itself in an extremely difficult economic situation and was forced to temporarily suspend production.
Strengthening protectionism has a negative impact on the development of industries based on imported technologies, raw materials, semi-finished products, and components. The increase in duties ultimately benefits a small part of domestic producers, who, becoming a kind of monopolist, begin to dictate prices for products that are not of world-class quality. Protected industries lose incentive to improve production. All this leads to a narrowing of the market, deterioration in the quality of goods and rising prices.
Modern trade policy has, in addition to a defensive arsenal, an offensive arsenal of measures to expand national exports, which are carried out using a wide range of means of directly subsidizing the export of agricultural goods, stimulating production, research and development, providing various services to the exporter, allocating various types of subsidies at the expense of the budget and government funds, tax and insurance benefits, the provision of loans and government guarantees for them, etc. It is here that the center of gravity in the foreign economic policy of developed countries has shifted: assistance from government organizations in expanding the export of domestic goods has become one of the most important areas of state activity in the field of economics. The main attention is paid to measures to support the export of finished products, strengthening the country’s position in the world market in the long term.
In recent years, Russia has had a positive trade balance, but this cannot serve as evidence of the effectiveness of its trade policy. It was practically the result of low growth rates of imports, as well as active exports of non-renewable natural resources, primarily energy raw materials. For a long time, Russian exports were limited on the basis of quantitative restrictions (quotas and licenses), which largely occurred under pressure from central and local bureaucratic structures that did not want to part with the levers of control over foreign trade that had been established in Soviet times. The last restrictions in the form of quotas and duties on a number of goods were abolished only in 1995.
The absence in Russia of a number of legislative acts necessary for the normal functioning of foreign trade has led to the widespread use of so-called operational regulation measures, meaning the desire to solve emerging problems with the help of “fire” measures, often ill-considered measures caused by the circumstances of a particular moment. The use of such ill-considered measures often leads to drastic steps on the part of counterparty states.
4. Prospects for the development of foreign trade of the Russian Federation
The current Russian government shows no interest in the idea of restructuring the country's foreign economic specialization. Finance Minister A. Kudrin, for example, is convinced that over the next 50-100 years natural resources will prevail in domestic exports.
The long-term forecasts of the Ministry of Economic Development and Trade, however, indicate that by 2015 the share of fuel and energy industries in domestic exports should decrease to 43%.
An analysis of the state and forecasts for the development of individual sectors of the national economy suggests that changes in the nature of Russia’s participation in world economic relations are insignificant. But in the medium term, foreign economic specialization can be diversified, relying on natural factors (forests, fertile lands, etc.). Also, high technologies in the defense industry, basic science, etc. could make a certain contribution. Such diversification could help strengthen the country’s position as an exporter and reduce its import dependence.
The qualitative state of foreign trade is due to the fact that the country's economy is at the stage of development of competition. In this regard, it is vital for Russia to expand its sources of competitive advantage to include investment and innovation. Depreciation of fixed assets in industry is 52.7%, and their renewal rate is 1.7%. With such funds, it is very difficult to produce competitive products.
One of the most important conditions for increasing competitiveness is the rapid growth of investments in manufacturing industries and the agricultural sector. To modernize the economy, a huge amount of capital investment is required - more than 2 trillion. dollars over the next 20 years. Although in recent years the volume of investment has increased by 10.6% per year, this is not enough.
It seems very important to establish mechanisms for transforming savings into investments and intersectoral flow of capital. Purely theoretically, the mobilization of resources for investment and their redistribution can be carried out entirely or in a certain share through three institutional structures - the state (with an appropriate level of taxation), large financial and industrial groups and financial markets. It is obvious that the state cannot now dominate in the transformation of savings into investments, since it mobilizes only part of the resources available in the economy for centralized distribution. Large domestic financial-industrial groups are, in principle, capable of large-scale attraction of investor funds, but cannot take control of the entire volume of savings and cover all categories of depositors, primarily the population, which treats oligarchic structures with persistent distrust.
Theoretically, financial industrial groups could become an instrument for intersectoral capital flows, but in practice this possibility is essentially crossed out by the principles that prevail in the activities of Russian corporations. These principles consist of extracting maximum profit from existing tangible assets in the shortest possible time and using a smaller part of this profit to maintain production, and most of it for transformation into financial assets and dividends.
In addition, it should be taken into account that the flow of capital is hampered by the lower level of profitability in the finishing industries compared to the extractive and primary processing industries. According to official data, the profitability of products and assets in the extractive industries is many times higher than the profitability in the manufacturing industry. With such different levels of profitability, entrepreneurs in more profitable industries, in which today domestic capital is mainly concentrated, have no incentive to invest in other industries and invest in projects that will be less profitable.
Financial markets in Russia - credit and stock, unfortunately, are not yet sufficiently developed: the first due to the weakness of the banking system, the second due to the small number of well-functioning companies whose shares could be of interest to capital investors. Therefore, strengthening financial markets is the most important condition for solving the problem of bringing the volumes of savings and accumulation closer together. In order to intensify the investment process, some believe it is necessary, following the example of other countries, to organize the activities of state development banks. These banks could finance investments in fixed capital due to the overwhelming majority of domestic savings concentrated in them or the credit resources of the Central Bank. Other economists see an investment resource in the use of money emission tied to the volume of government borrowing on the domestic market. They propose to direct these funds only to high-tech industries, mainly to the military-industrial complex.
It is possible that these measures may initially give a certain impetus to an increase in investment. In addition, as the practice of Russian enterprises using foreign loans shows, there is a high probability that borrowers will strive to avoid repaying the loans received and shift debt payments onto the shoulders of the state. Therefore, it would be more rational to stimulate the private sector to make industrial investments in high-tech industries by providing investment incentives and subsidizing bank lending rates.
An equally important task is to intensify the use of the innovation factor on the basis of the targeted development of the scientific and technical sphere. Russia has certain opportunities to compete in the global market. These areas include education, culture, fundamental science and design developments. At the same time, the export of know-know should occur on a mutually beneficial basis, allowing for the joint exploitation of certain developments carried out in our country. One of the options for this direction should be active introduction into the markets of developing countries, where it is possible to ensure a fairly high level of competitiveness and quality of a number of products and technologies (aerospace, microbiological, educational) with an adequate pricing policy.
Finally, a transition to a fundamentally new export model is possible, when future exports from our country will be financed by partners in the world market within the framework of fairly stable and long-term programs. Investments in R&D, in education based on our existing potential, in the development of environmentally friendly technologies can ensure the future export of our results.
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