This document provides an overview of international trade practices, including definitions and theories. It discusses why countries trade, focusing on resources, economic, and political reasons. It also covers invisible trade such as transportation and tourism. The document then examines theories of absolute and comparative advantage. Finally, it analyzes barriers to international trade such as socio-cultural factors, economic issues, and various tariff and non-tariff barriers, identifying reasons countries impose such barriers.

1. International Trade PracticesInternational Trade Practices
国际贸易实务国际贸易实务

2. Part 1 OverviewPart 1 Overview
Chapter 1 Introduction to International TradeChapter 1 Introduction to International Trade
Chapter 2 Basic Theory of International TradeChapter 2 Basic Theory of International Trade
Chapter 3 Barriers to International TradeChapter 3 Barriers to International Trade
Chapter 4 E-CommerceChapter 4 E-Commerce

3. Chapter 1 Introduction toChapter 1 Introduction to
International TradeInternational Trade
What is International Trade? And Why
do countries trade?
Invisible Trade
Investment
Effectiveness Measurement of
International Trade

4. International TradeInternational Trade
------the exchange of goods, services,------the exchange of goods, services,
and technologies across national boundaries.and technologies across national boundaries.
It includes import and export operations.It includes import and export operations.

5. Why do countries trade?Why do countries trade?
Countries engage in international trade for the
following reasons:
1. Resources Reasons,
eg. Natural resources
Favorable climate conditions and terrain
Skilled workers and Capital Resources
Favorable geographic location and transportation
costs.

6. 2. Economic Reasons
eg. Comparative advantage
Strong domestic demand
Scale economy
Innovation or style
3. Political Reasons
In these cases, political objectives outweighed economic
considerations. eg. Former Soviet Union and Cuba.

7. Invisible TradeInvisible Trade
------the exchange of services------the exchange of services
between nationsbetween nations
Such as
international cargo transportation,
International cargo transportation insurance,
and tourism.

8. FDIFDI
------a third important category in a------a third important category in a
nation’s balance of trade, and a morenation’s balance of trade, and a more
important than trade as a vehicle forimportant than trade as a vehicle for
international economic transactionsinternational economic transactions

9. Measurement of Global TradeMeasurement of Global Trade
Two key indicators:
Balance of Trade & Balance of Payments

10. Chapter 2 Basic Theory of International TradeChapter 2 Basic Theory of International Trade
1. Classical Trade Theory
Adam Smith (1723-1790) and His
Absolute Advantage
David Ricardo (1772-1823) and His
Comparative Advantage
2. Neoclassical Trade Theory
3. Modern Trade theories

11. Theory of Absolute AdvantageTheory of Absolute Advantage
Wheat(one unit) Cloth(one unit)
Britain 200 days 100 days
France 100 days 200 days
Britain: (200+100)/100=3
France: (100+200)/100=3

12. Theory of Comparative AdvantageTheory of Comparative Advantage
Woolen(Labor/unit
) Wine(Labor/unit)
Britain 100 120
Portuguese 90 80
Britain: (100+120)/100=2.2
Portuguese: (90+80)/80=2.125

13. Chapter 3 Barriers to International TradeChapter 3 Barriers to International Trade
1. Socio-cultural Barriers1. Socio-cultural Barriers
2. Economic Barriers2. Economic Barriers
3. Trade Barriers3. Trade Barriers

14. 1. Socio-cultural Barriers1. Socio-cultural Barriers
Language
Religion
Customs and Manners

15. 2. Economic Barriers2. Economic Barriers
Exchange Rate
Extra Costs: ocean freight; packing cost;
marine insurance; cost of document, etc.

16. 3. Trade Barriers3. Trade Barriers
Tariffs
Specific Duties
Ad valorem Duties
Compound Duties
 Non-tariffs(NTBS)
Quota
Licensing System in Importing Countries
New Barriers

17. Reasons of Trade BarriersReasons of Trade Barriers
 To correct a balance-of-payments deficit
 For reasons of national security
 To protect their own industries against
the competition of foreign goods.