Page 348 - DECO503_INTERNATIONAL_TRADE_AND_FINANCE_ENGLISH

International Trade and Finance

Notes 29.7 Key-Words

1. International negotiations : Negotiating abroad requires the ability to meet special challenges
and deal with the unknown. Even those experienced in cross-cultural
communication can sometimes work against their own best interests
during international business negotiations. Skilled negotiators know
how to analyze each situation, set up negotiations in ways that are
advantageous for their side, cope with cultural differences, deal with
foreign bureaucracies, and manage the negotiation process to reach
a deal.
2. Tariff rates : A tax imposed on imported goods and services. Tariffs are used to
restrict trade, as they increase the price of imported goods and
services, making them more expensive to consumers. They are one
of several tools available to shape trade policy.
3. Free trade : A free-trade area is a trade bloc whose member countries have signed
a free-trade agreement (FTA), which eliminates tariffs, import
quotas, and preferences on most (if not all) goods and services traded
between them. If people are also free to move between the countries,
in addition to FTA, it would also be considered an open border. It
can be considered the second stage of economic integration.
29.8 Review Questions

1. What is the impact of WTO on various aspects of Indian Economy? Explain.
2. What are the functions of WTO? Discuss.
Answers: Self-Assessment
1. (i)(c) (ii)(c) (iii)(a)
(iv)(b) (v)(d) (vi)(c)
29.9 Further Readings

1. Krimawati, Wawat. (?) NAFTA: North America Free Trade Agreement. [Accessed
18 May 2009]
2. Vogel, David. (2009) North American Free Trade Agreement. [Accessed 18 May
2009] 2009. North American Free Trade Agreement (NAFTA).
3. United States Department of Agriculture, Foreign Agricultural Service. [Accessed
June 8, 2009]

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