International Business Topics
Edited by Xu Jing
01/2007 LanZhou
Chapter One
Brief Introduction of
International Trade Theories
Mercantilism






Emerged in England in the mid-16th century
Gold and silver were the mainstays or unique form of
national wealth and essential to vigorous commerce
It was in a country’s best interests to maintain a trade
surplus
Its doctrine is to advocate government intervention
Its policies are to maximize exports and minimize imports
(boost exports and limit imports)
Zero-sum Game & Positive-sum Game
3
Absolute Advantage



Its definition: the ability of a country to produce a
good or service at a lower cost than its trading
partners.
English economist, Adam Smith, in his landmark
book “The wealth of Nation” in 1776.
Its principle: Countries should specialize in the
production of goods for which they have an
absolute advantage, and then trade these goods for
the goods produced by other countries. That is to
say, you should never produce goods at home that
you can buy at a lower cost from other countries.
4
Absolute Advantage
Before specialization: total world production is 4 units
x
y
Country A 1
2
(A has absolute ad in the goods X)
Country B 2
1
(B has absolute ad in the goods Y)
 After specialization:
total world production is 6 units
x
y
Country A 3
0
(A specializes in the goods X)
Country B
0
3
(B specializes in the goods Y)


Then they trade
5
Absolute Advantage


So, by specializing in the production of goods
in which each has absolute advantages, both
countries benefit by engaging in trade.
( Positive-sum game)
In a word, absolute advantage is the ability to
produce more output from given inputs of
resources than others can.
6
Comparative Advantage


Its definition: the ability to produce at lower
cost compared to other producers, whether
they are countries, firm, or individuals.
English economist, David Ricardo, in his
book “Principles of Political Economy ”
in 1817.
7
Comparative Advantage


Its Principle: If a country has absolute advantage
in the production of all goods, it doesn’t need to
produce all goods and it should specialize in the
production of the goods of which it has
comparative advantage.
The comparative advantage arises from
differences in productivity---the efficiency with
which a country utilizes its resources to produce
outputs .
8
Comparative Advantage
Before specialization: total world production is 4 units
x
y
Country A 6
3
(A has absolute disadvantage )
Country B 1
2
(B has absolute ad in goods X & Y)
 After specialization:
total world production is 6 units
x
y
Country A 0
9
(A specializes in the goods Y)
Country B
3
0
(B specializes in the goods X)
 Then they trade

9
Comparative Advantage


Two countries have benefited from
specialization and world free trade.
(Positive-sum Game)
两利相权取其重
两弊相衡取其轻
10
Heckscher-ohlin Theory


A different explanation of comparative
advantages was put forward by Swedish
economists Heckscher & Ohlin in 1933.
The comparative advantages arises from
differences in National Factor Endowments
( 要素禀赋的不同)
11
Heckscher-ohlin Theory


Factor Endowments: the extent to which a
country is endowed with such resources as
land, labor, and capital. such as: laborintensive, skill-intensive.
Different
nations
have
different
endowments, different factor endowments
explain differences in factor costs.
12
Heckscher-ohlin Theory

Its Principle: A country should specialize in
the production of goods that make intensive
use of factors that are locally abundant, and
then export those goods, while importing
goods that make intensive use of factors that
are locally scarce.
U.S exports agricultural goods---It has
abundant arable land.
China exports labor-intensive manufacturing
industries (textiles) ---It has abundant low-cost
labor.
13
Heckscher-ohlin Theory

H-O
model
and
Comparative
advantage both have the assumption of
constant returns to specialization--- the
units of resources required to produce a
good are assumed to remain constant.
14
The Product Life-Cycle Theory


Put forward by Raymond Vernon in
the mid-1960s
There are four phases of the whole
process of a new product in market.
15
The Product Life-Cycle Theory

The 1st phase: A new product is developed
by an advanced country and sold at its
domestic market.
1. Initial-producer
of new products
monopolized the production and market
of this new product.
2. U.S was always considered as an initial–
producer by Vernon.
16
The Product Life-Cycle Theory


The 2nd phase: other advanced countries
began to imitate the production of this new
product and U.S firms have begun to sell
this new product from advanced countries
to some developing countries.
The 3rd phase: Other advanced countries
began to export this new product to
developing countries and then to U.S
17
The Product Life-Cycle Theory


The 4th phase: The production of this new
product has been concerned in developing
countries.
So, the place of global production initially
switches from the United States to other
advanced nations, and then from those
nations to developing countries.
18
The New Trade Theory


Emerged in the 1970s.
A few terms:
Economies of scale: There are
increasing returns to specialization.
That is to say, as output expands with
specialization and fixed costs of
developing a new product were spread
over a larger output, so the unit costs of
production should decrease.
19
The New Trade Theory


Diminishing returns to specialization:
the more of a goods a country produces,
the greater the units of resources that
will be required to produce each
additional item.
First-mover advantages: Early entrants
are able to gain economies of scales
and they can create barriers to entry
which discourage subsequent entry.
20
The New Trade Theory
Main doctrines:
 There
are increasing returns to
specialization in many industries.
 There is a first-mover advantages in
those industries where the existence of
substantial economies of scale.
21
The New Trade Theory

A country may predominate in the
export of a goods simply because it
was lucky enough to have one or more
firms among the first to produce that
goods. (which is different from H-O
model)
22
Porter’s Diamond



What are the attributes in Porter’s
diamond?
What are the additional variables can
influence the national diamond?
Why are the theories of international
trade important to an individual
business firm in its international
marketing activities?
23
Summary


1.
2.
3.
Main ideas of six basic international theories.
Questions:
Why did the mercantilists encourage exports and
restrict imports?
Please use examples to explain Absolute
Advantage & Comparative advantage.
What’s the difference between Comparative
Advantage & H-O Model.
24
Summary
4. Please describe four phases in the whole
process of a new product in market.
5. According to the New Trade Theory, how
can a country predominate in the export of
a goods.
6. What are the main attributes in Porter’s
diamond?
25
Summary

To explain the following terms:
absolute advantage// comparative advantage//
factor endowments// diminishing returns //
economies of scale// first-mover advantages

To translate the following terms:
mercantilism; trade surplus; maximize
exports; boost exports & limit imports;
specialization; initial-producer; increasing
returns; barriers to entry;
26
Chapter Two
International Monetary System
27
The Gold Standard


1.
2.
the end of 19th century ------ World War I
Main elements:
Gold was the world currency and each
trading nation agreed to tie its currency to
gold.
This amounted to a fixed exchange rate
system in which the exchange rate between
each pair of currencies was fixed.
28
The Gold Standard
3.International trade were conducted in
convertible currencies which
can be
exchanged without impediments for other
currencies or gold.
4.Gold was used only for final settlement
5.It has automatically function on balance of
payment
29
The Gold Standard

1.
2.
Main monetary policies: ( reserve
requirements, discount loan rate, open
market operation)
contractionary monetary policies on
deficit countries
expansionary monetary policies on
surplus countries
30
The Gold Standard

1.
2.
3.
Why did it collapse?
The liquidity in the international payments
system fluctuated with gold discoveries
The confliction among some countries
became sharp, some countries devalued
their currencies which destroyed
the
stability of the system.
It began to collapse around World War I and
broke down during the Great Depression.
31
The Bretton Woods System


In July 1944, representatives of 44 countries
met in Bretton Woods, New Hampshire,
U.S.A
Main purpose: to design a new international
monetary and financial system that would
provide a stable environment to foster
prosperity and world trade.
32
The Bretton Woods System

1.
2.
3.
Main elements:
a fixed exchange rate system
the dollar as the reserve currency for the
international payments system.
Tie U.S dollar to Gold at a fixed prices of $35
per ounce
33
The Bretton Woods System
4.

The establishment of International
Monetary Fund (IMF) and International
Bank for Reconstruction and Development
(IBRD) (also called World Bank)
Its disadvantages:
1.
Tied the hands of central banks of each
countries by maintaining a fixed
exchange rate
34
The Bretton Woods System
2. policymakers lost considerable freedom
in conducting monetary policy for
domestic objectives.
3.deficit countries had to pursue
contractionary monetary policy and
devalue their domestic currency

The Fixed Exchange Rate System
collapsed in 1973
35
The Jamaica Agreement


1.
2.
IMF, in Jamaica, in 1973
Its main elements:
Floating Exchange Rates were declared
acceptable.
Gold was abandoned as a reserve asset.
36
The Jamaica Agreement
3. Total annual IMF quotas---the amount
member-countries contribute to the IMF---were increased to $41 billion.

Since 1973, exchange rates have become
much more volatile and far less
predictable.
37
The European Monetary System


In 1979, the members of the European
Community created the European Monetary
System (EMS)
Its objectives:
1. To create a zone of monetary stability in
Europe (by reducing exchange rate
volatility and converging national interest
rates)
38
The European Monetary System
2. To control inflation through the
imposition of monetary discipline.
3. To coordinate exchange rate policies
versus non—EC currencies such as the
U.S. dollar and the yen.
39
The European Monetary System

1.
Its main elements:
Establish European Currency Unit (ECU)
which is a ‘basket’ of the EC currencies--one Ecu comprises defined percentages of
national currencies.
40
The European Monetary System
2.Exchange Rate Mechanism (ERM) ties
participating countries together in a system
of semi-rigid exchange rate.
3.Members are allowed to fluctuate their
exchange rate within a band of 2.25 percent
on either side of central value.
41
The European Monetary Union

Members of EC, in Dec, 1991, in Maastricht

Treaty of Maastricht ---Design three steps
of achieving European Monetary Union
1. 1990/July/01---1993/Dec/31
a. Strengthen monetary policies regulation in
member-countries
b. Reduce the fluctuation of central rate of
ECU
c. Enlarge the range of ECU being used in EC
42
The European Monetary Union
1994/Jan/01---1998/Dec/31
a. Build the testing model of European Central
Bank
b. Confirm the list of first participants
3. 1999/Jan/01---until now
Achieve the same currency, same central bank
and same Monetary policies in EC
2.
43
Basel Accord

1.
2.
3.
Basel I
G-10 countries, in Basel, Switzerland, in 1988
Capital adequacy - ensuring that financial
institutions retain enough capital to protect
themselves against unexpected losses.
Banks with international presence are required to
hold capital equal to 8 % of the risk-weighted
assets.
44
Basel Accord
Basel II
1. The basic purpose:
To revise the international standards for measuring
the adequacy of a bank's capital
2. The specific purposes:
(1) Ensuring that capital allocation is more risk
sensitive;
(2) Separating operation risk from credit risk, and
quantifying both;
(3) Attempting to align economic and regulatory

45
Basel Accord
capital more closely to reduce the scope for
regulatory arbitrage. .
3. “Three pillars" concept
(1) minimum capital requirements
(2) supervisory review
(3) market discipline - to promote greater
stability in the financial system.
46
Summary


Basic Phases in Evolution of International
Monetary System
A few terms
47
Chapter Three
Exporting, Importing and
Countertrade
48
Exporting & Importing
What are the main elements for Exporting
& Importing ?

1.
2.
3.
Collect information
Identifying export opportunities
Exporting & importing Financing
49
Exporting & Importing Financing
An acute problem---Lack of Trust

1.
2.
the distance between the two parties ---- in
space, language, and culture
the problems of using an underdeveloped
international legal system to enforce
contractual obligations
50
Exporting & Importing Financing

How to solve the problem
By using a third party trusted by both ----A reputable bank--- to act as an
intermediary
51
Letter of Credit
Its definition: Issued by a bank at the request
of an importer, the letter of credit states
that the bank will pay a specified sum of
money to a beneficiary, normally the
exporter, on presentation of particular,
specified documents.
52
Letter of Credit
Its advantages:
Parties in transaction are likely to trust
reputable, even if they do not trust each
other.
53
Letter of Credit (Steps)
1.
2.
3.
4.
5.
6.
Importer obtains bank’s promise to pay on
importer’s behalf
Importer’s bank promises exporter to pay
on behalf of importer
Exporter ships goods “to the bank”
The bank pays exporter
Bank gives merchandise to importer
Importer pays bank
54
Draft



Its definition: (a bill of exchange). It is
simply an order written by an exporter
instructing an importer, or an importer’s
agent, to pay a specified amount of money at
a specified time.
The maker: the party initiating the draft
The drawee: the party to whom the draft is
presented
55
Draft
Sight draft: payable on presentation on the
drawee.
 Time draft: a delay in payment. It is
presented to the drawee, who signifies
acceptance of it by writing or stamping a
notice of acceptance on its face. They are
negotiable instruments.
 Banker’s acceptance: accepted by a bank
Trade acceptance: accepted by business firm

56
Bill of Lading


Its definition: issued to the exporter by the
common
carrier
transporting
the
merchandise.
Its functions: a receipt
a contract
a document of title
a collateral
57
Steps in An International Trade
A Typical International Trade Transaction
involves 14 distinct steps:
A few terms:
Letter of credit // Delivery terms // time draft
endorse // bill of lading //accepted draft//
maturing draft // matured draft // holder//

58
Counter-trade
Why they exist?
government’s restriction on the convertibility
its currency for keeping its foreign exchange
reserves
 Its principle:
barter-like agreement--- to trade goods &
services for other goods & services when
they can’t be traded for money.

59
Types of Counter-trade

1.
2.
Types of Counter-trade
Barter : direct exchange of goods &
services without a cash transaction. (most
restrictive arrangement)
Counter-purchase: a reciprocal buying
agreement
A sells to
B
A buys from B
60
Types of Counter-trade



Offset: similar to counter-purchase
A sells to
B
A buys from C ( same country with B)
Switch Trading: Counter-purchase credit
A counter-trade
B
A sells credit to C sells to D buy
from B’s country
Compensation or Buybacks: Use output as
payment
61
The Pros & Cons of Countertrade

1.
2.
The Pros:
A way to finance an exporting or
importing when other means are not
available.
Remain competitive with large trading
companies
62
The Pros & Cons of Countertrade

1.
2.
3.
The Cons:
not as convenient as other means
The exchange of unusable or poor-quality
goods
The cost of investing in an in-house trading
department is expensive and time
consuming
63
Summary
Basic financing ways for exporting &
importing

Basic types of Counter-trade
Questions:
1.
What’s a letter of credit?
2.
What’s a bill of lading?
3.
What’s a draft?

64
Summary
4. What are the main types of Countertrade?
5. What are the reasons for coutertrade?
6. What are the differences between counterpurchase and offset?
65
Chapter Four
Non - export Entry Modes
------ Strategic Alliance
66
Nature of Strategic Alliances

Its definition
a mutually beneficial long-term formal relationship
formed between two or more parties to pursue a set
of agreed upon goals or to meet a critical business
need while remaining independent organizations.

Fundamental purpose
to enhance the long-run competitiveness of the
strategic partners
67
Strategic alliance’s benefits for Firms




Increase in capital for research and product
development and yet lower risk (Innovation)
Decrease in product lead times and life cycles
(time pressures)
Ability to bring together complementary skills
and assets that neither company could easily
develop on its own
Access to knowledge and expertise beyond
company borders (technology transfer)
68
Strategic alliance’s benefits for Firms





Rapidly achieve scale,critical mass and
momentum (Economies of Scale - bigger is better)
Expansion of channel and international market
presence (enter a foreign market)
Building credibility in the industry and brand
awareness
Providing added value to customers
Establishing technological standards for the
industry that will benefit the firm
69
Strategic alliance’s Core dimension







Goal compatibility
Strategic advantage
Interdependence
Commitment
Communication and conflict resolution
Coordination of work
Planning
70
Strategic Alliance’s Principles







top management must be involved
Meet frequently, and often informally
Use a matchmaker
Maintain independence
Allow no “sacrifice ideals”
Have a monitor
Anticipate cultural differences
71
Forms of strategic alliance
Licensing
Crossdistribution
agreement
Crossmarketing
agreement
Contracting
Strategic
Alliance
Crossmanufacturing
agreement
Joint
venture
R&D
consortia
72
Licensing

Its definition
a method of foreign market operation
where the licensor signs a contractual agreement with licensee whereby the licensee is
given the right to use something owned by
the licensor.
73
What can be Licensed ?
Technology, know-how,
patent/non-patent processes
Other types of
knowledge
and trade secret
Trademark,
brand name,
logos
Licensing
Agreement
Marketing knowledge
and processes
Product/facility design
74
Licensing

1.
2.
3.
4.
The licensor’s main source of income
Initial payment
Annual minimum
Annual percentage fee
Additional Fees
75
Franchising – A Special Type



A method of doing business wherein a
franchisor licenses trademarks and methods
of doing business to a franchisee in
exchange for a recurring royalty fee
150 years history, came to prominence in
1950s.
Franchise-based industries includes fastfood,
beverage, retailing, entertainment etc.
76
Licensing’s objectives



Obtaining revenue from company-owned
patents, trademarks, and accumulated knowhow
Gaining some strategic advantage in
marketing its products in foreign markets
Acquiring reciprocal know-how and research
developments form foreign companies
77
Licensing’s objectives




Gaining a foothold in a market for future
actions.
Entering a market when conditions make
export undesirable
Gaining a foreign-market production
presence when capital investment is not
available
Contributing to economic development
where needed
78
Licensing’s advantages



Ease and low cost of entering a foreign
market
Making good use of licensee’s management,
capital equipment and knowledge to exploit
a foreign market
Testing a foreign market without the risk of
capital loss
79
Licensing’s disadvantages




A potential competitor is set up.
lack of overall control
Incomplete market exploration
Loss in flexibility and weak
diversification
in
80
Discussion



Read the example of an American company
getting locked in a licensing agreement with a
leading European manufacturer on page 55.
What caused the failure of this licensing
agreement?
What do you have to suggest?
81
resolutions to problems
Make your partner happy
 profitability
 ownership
 innovation
82
Contracting

Contract Manufacturing

Management Contracting
83
Contract Manufacturing
A long-term arrangement between a foreign
producer and an international company hereby
the former produces the products while the
latter in charge of marketing, distributing,
transferring the technology and assistance.
84
Its Advantages





Minimum cash, time, personnel
Control over marketing, after-sale service and
trademark
Circumvent entry barriers
Label of “local made”
Avoid intra-corporate pricing problem
85
Its Disadvantages





Profit shared
Training a potential competitor
Hard to find a satisfied manufacturer
Little control on quality
Critics of exploration or sweatshops
86
Management Contracting
An arrangement between an international
marketer and a local investor to establish an
enterprise.The former provides management
know-how and the latter provides capital.
87
Its Advantages






Local investor’s acquisition of a complete
operational system
Foreign marketer’s safe way into a market
with option
A management without equity control or
legal obligations
A guaranteed income & quick returns
Avoid foreign exchange or other remittance
Clarity in administration
88
Its Disadvantages




Complex and expensive documentation
Limitation of future management and
investment
Shortage of personnel
If without option, potential competitor
created
89
Joint Venture
A business relationship between two or more
parties to undertake economic activity
together. All parties agree to share in the
profits and losses of the enterprise. The
venture is for one specific project only,
rather than for a continuing business
relationship as in a strategic alliance.
90
Two Kinds

Specialization ventures
organized around functions like marketing
or manufacturing

Shared Value-added Venture
organized with unique and valuable
contributions by each partner
91
Its Advantages
Best way to enter more overseas market for
small companies
Minimized risks resulted from saving of
resources
easier adaptation to unfamiliar environment
Less subject to political-legal adverse action
Sharing sales revenues
92
Its Disadvantages
Limited profit potential
Possible conflicts over management decision
and dividend policy
Conflicts arising from cultural differences
Self-competing in other markets
The faster learner may dominates or
terminates the venture.
93
Summary



Why do joint ventures usually last shorter
than other strategic alliances?
Which form of strategic alliance are more
suitable for hi-tech businesses? Why?
Why do franchising become so popular in
this globalization era?
94
Key terms









Strategic alliance
Licensing
Cross-licensing
Franchising
Contract manufacturing
Management contracting
Joint venture
Subcontracting
Intra-corporate (transferring )price
95
Chapter Five
Foreign Direct Investment
96
Goals of the Unit



An overlook at the world pattern of FDI
Distinguish horizontal and vertical FDI
Understand the factors that influence the
choice of FDI
97
Read the text and find out



What are the changes in the nature of FDI ?
What are the reasons for a faster FDI than
WT?
Why U.S a big FDI recipient while Japan a
small one?
98
Features of World FDI




Marked increase
Japan, EU as major FDI outflow sources
U.S as a big FDI recipient
Medium-small firms’ participation
99
Reasons for faster growth of FDI


Fear of protectionists among businesses and
pressure on circumventing trade barriers
Necessity of being customized to local
conditions
100
Why U.S a big FDI recipient while
Japan a small one?




Unrealized market potentials in U.S.A
Exchange rates (weak dollar, strong euro &
Japanese yen)
A belief of poor U.S. management
Government support in Japan
101
Horizontal FDI

FDI in the same industry abroad as a firm
operates at home

4 factors influencing the choice of FDI
Transportation Costs
Market Imperfections
A. Impediments to Exporting
B. Impediments of the sale of Know-how
Following Competitors
The Product Life Cycle
1.
2.
3.
4.
102
What is market imperfection?

Market imperfections or distortions, generally,
mean any deviation from the assumptions of
perfect competition. That is, the best allocation
of resources are not achieved, there is imperfect
competition. Different types of imperfections
and distortions include:
Monopoly, Duopoly and Oligopoly
103
The Product Life Cycle in HFDI
 Introduction stage: Pioneers invest in an
advanced country where demand supports local
production
 Growth stage: Demand grow in other
advanced countries
 Maturity stage: Standardization and market
saturation give rise to cost pressure, thus FDI in
developing countries
 Declining stage: FDI in low-cost locations
104
Vertical FDI


Backward Vertical FDI
Into an industry abroad that provides inputs for
a firm’s domestic production processes.
Forward Vertical FDI
Into an industry abroad that sells the outputs of
a firm’s domestic production processes.
105
The theoretical supports of VFDI


Market Power
Market Imperfections
106
What is market power?

In economics, market power (sometimes
called monopoly power) is a market failure
which occurs when one or more of the
participants has the ability to influence the
price or other outcomes in some general or
specialized market.
107
Why do firms undertake vertical FDI
according to market power theory?


Vertical FDI limits competition and strengthen
control over source of raw materials and shut
new entrants out
Vertical FDI as an attempt to circumvent
barriers by existing competitors in the host
country.
108
How does market imperfection
theory argue for vertical FDI?


Impediments to sale of know-how exist, that is
there is no efficient producer in the host country
which is able to extract raw materials.
Investment in specialized assets (an asset
designed to perform a specific task and the
whose value is significantly reduced in its next
–best use.)
109
Discussion



What’s difference between horizontal FDI
and vertical FDI
Given the current situation of globalization,
what do you think will be the trend of FDI?
HFDI or VFDI? What are the targets?
What do you know about FDI in China? Are
we a strong recipient of FDI or a big
outflow investor ?
110
Key terms









Transportation costs
Market imperfections
Market impediments
Market power
Oligopoly
Forward vertical FDI
Backward Vertical FDI
Horizontal FDI
Specialized assets
111
Chapter Six
International Technology Transfer
112
Goals of the Unit




Identify the nature and classification of
technology
Understand the processes and modes of
technology transfer
Discuss the relevant issues for businesses
Distinguish various technology transfer
strategies
113
The Nature of Technology


1.
2.
3.
4.
Its definition
Its classification schemes
hard & soft
proprietary & non-proprietary
front-end & obsolete
bundled & unbundled
114
Technology Transfer Process




Its features
What factors can affect it?
The expediters & controllers of it
Modes of technology transfer
115
A Few Issues for the Firms




Why do firms need to maintain a
technology advantage?
How to maintain its technology advantage?
What is the motivation of firms for
establishing foreign R&D units?
What are the main strategies for technology
transfer?
116
Summary



The nature of technology
Technology transfer process
A few issues for the firms
117
Chapter Seven
Products & Branding in Brand
Management
118
Branding Management


1.
2.
3.

1.
2.
Its basic objective
What is a Brand?
Its definition
The keys to creating a Brand
Brand elements
Brands Vs Products
What’s a product
Five levels of a product
119
The importance of Brands



For consumers
For manufactures
For firms
120
What can be branded?








Physical goods
Commodities
High-tech Products
Services
Retailers & Distributors
People & Organizations
Sports, Art & Entertainment
Geographical Locations
121
Summary





What’s a Brand?
The keys to creating a Brand
Brands & Products
The importance of Brands
What can be branded
122
Chapter Eight
Globalization
123
Globalization




What’s Globalization?
What’s the driving power for globalization?
Globalization of Culture
Globalization of Consumption
124
Globalization of the Economy


1.
2.
3.
4.
5.
6.
7.
How to understand it?
The trends of Globalization of the Economy
Globalization of Finance
Transnational Corporations
Change of the direction of FDI
Global Specialization of Work
Global Specialization of Service
The Global Office
Global Tourism
125
Summary




Globalization
Globalization of Culture
Globalization of Consumption
Globalization of Economy
126
Chapter Nine
The WTO
127
The Former of the WTO


The GATT
The Uruguay Round
128
The WTO


1.
2.
3.
4.
5.
6.
The WTO
The Main Principles of The WTO
Nondiscriminatory trade
Tariff Concessions
Preclusion of Quantitative Restrictions
“Anti-Dumping” & “Export Subsidies Restrictions”
Transparency
Mechanism of Dispute Settlement
129
Substantive Challenges to WTO

1.
2.
3.

Regional Trading Arrangement
Its Conditions
Main Forms of It
Challenges for the WTO
Trade in Service
130
Summary



The GATT
The WTO
Regional Trading Arrangement
131
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