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International Marketing
Chapter 3: Int’l Trade System andGlobal Economic Environment
Objectives
Introduce the current international trade system
Examine the effect of free trade areas
Discuss the economic factors that reflect market attractiveness
Understand the world trade patterns
The Marketing Process
Demographic
Economic
Political/legal
Social/cultural
Technological
Target
customer
Global Environments
demographic
economic
natural
technological
political
cultural
International Trade System
For international marketers, they must be aware of:
Trade restrictions in various countries and areas
International trade organizations and free trade areas
Economic variables relating to the target markets
Current world trade pattern
Various trade restriction or barriers -Tariff Barrier
What’s a Tariff?
A tariff is a tax or duty levied on the traded commodity as it crosses a national boundary. These tariffs can be of two types: protective and revenue.
Protective tariff (Import tax)
- It is designed to raise the retail price of imported products so that domestic goods will be more competitive and foreign business will be discouraged from shipping certain goods into the country. It is meant to save jobs for domestic workers to keep industries from bankruptcy because of foreign competition.
Various trade restriction or barriers -Tariff Barrier
Revenue Tariff
- It is designed to raise money for the government. It is also commonly used by developing countries to help infant industries compete in global markets.
The ways of imposing tariffs
It includes: Specific, Ad valorem and compound duties.
-Ad valorem Duty is a tax that is levied as a fraction of the value of the imported goods (or it is expressed as a fixed percentage of the value of the traded commodity).
restriction or
Various trade restriction or barriers -Tariff Barrier
Specific Duty is levied as a fixed charge for each unit of goods imported (or it is expressed as a fixed sum per p
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