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International Trade - Exporting and Importing - Essay Example
International trade is the importing and exporting of goods and services across countries boundaries. The international community which is comprised of different countries and international organization has set up rules and regulations that govern this type of trade…
Some of the popular tractors manufactured and exported by the USA are, John Deere, Ford Son and Kubota.
The companies engaging in international trade have to face various barriers before they can market their produce to oversee countries. The export of tractors from the USA to Chile or Thailand is affected by the following factors;
The demand for the product is the principle factor in the determining the viability of the country to export the product to. An example is the tractor which is used for tilling to produce crops for local and foreign consumption. Chile produces lumber, fruits and vegetable, grapes, pears, onion, wheat, corn, oats, peaches, garlic, asparagus and beans. Its major agricultural exports are fresh fruits, canned vegetables and wines. The government of Chile is encouraging more export from Chile to boost the country economy. Thailand on the other hand is a main exporter of rice. Due to this, tractors, which are used for tilling in large scale farms, are usually in high demand.
Before considering whether to export the tractors to another country. Careful evaluation must be done to ensure that the country does not have the technology or enough facilities to manufacture the product being exported. If the country has the means to produce the same product, then the exporter will be faced by stiff competition by the local manufacturers who may offer the same product at a cheaper price.
The existing trade blocks can p ...