Unit11__Compensation trade.pptVIP

Unit Eleven Compensation Trade, Processing Assembling Trade Objective and Requirement Objective Understanding and writing the letters connected with compensation trade Reading and understanding the processing and assembling trade-related contracts Requirement Get a knowledge of compensation trade, processing assembling trade Grasping the usual usage of professional words and sentences Grasping the professional terms of compensation trade, processing assembling trade Introduction Compensation trade is a form of counter trade in which incoming investment is repaid from the revenues generated by that investment. there are two kinds of compensation trade, i.e. direct compensation trade (buyback) and indirect compensation trade (counter purchase). Introduction Processing and assembling trade refers to the business activity of importing all or part of the raw and auxiliary materials, parts and components, accessories, and packaging materials from abroad in bond, and re-exporting the finished products after processing or assembly by domestic enterprises. It includes processing with supplied materials and processing with imported materials. Specimen Letters Proposal for Compensation Trade and Reply of Agreement Processing and Assembling Trade Specimen Letters Proposal for Compensation Trade and Reply of Agreement a. Proposal Dear Sirs, We thank you very much for your hospitality to our delegation last month. We were pleased to take the opportunity to discuss the possibilities of importing the machines and equipment from you on the basis of compensation trade. In compliance with our discussion, we shall repay the cost of the machines and equipment with the steel wire ropes processed with the said machines and equipment in 4 lots within two years after the trial operation of the machines. The price of these steel wire ropes is to pay for the machines and equipment you supply plus insurance and freight. Our bank will open an irrevocable banker’s acc