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Conduct Your International Research on the Web

Published on Saturday, January 01, 2000

With today’s new technologically-advanced Internet, obtaining the information you need to expand internationally has never been easier. And you can significantly reduce your research costs while greatly improving your results.

Who Has Time to Surf?

The Internet can provide you with intelligence on just about any topic. And surfing the web can be enjoyable. But who’s got the time? To make your job easier, we’ve reviewed several sites you may find extremely useful.

Obtain Government Statistics

More than 70 U.S. government agencies produce data that can help you expand internationally. The Fedstats website (www.fedstats.gov/) directly accesses data from these agencies.

To obtain this data, click on Agencies, Data Access Tools, Programs, Regional Statistics, Press Releases, or additional links.

Visit the CIA

The CIA’s World Factbook (www.odci.gov/cia/publications/factbook/index.html) provides extensive studies on every nation in the world. The studies include demographic data, economic figures, political conditions, maps, etc.

Convert Foreign Currencies Fast

The Universal Currency Converter website (www.xe.net/ucc/) converts currencies in seconds. Simply choose a currency, input an amount and then select the destination currency. Or if you prefer, use CNN’s currency site (cnnfn.com/markets/currencies/).

Global One-Stop Research

If you’re seeking a one-stop site to conduct business research, you’ll want to visit the BizTech Network (www.brint.com). This site provides information on business, technology and management. Click on the Knowledge Map and then onto International Trade. You’ll be amazed at what you find.

Conduct Country-Specific Research

The Internationalist (www. internationalist.com) offers a wide array of international research. For example, under International Business, click on China and access Financial Services, Consultants, Government Links, and Country Business.

Click Here Before Traveling

The U.S. Department of State Bureau of Consular Affairs (travel.state. gov) features visa and passport information, customs regulations, locations of U.S. embassies and consulates, health conditions, and much more.

Trade Compass

Trade Compass (www.trade compass.com) is a comprehensive and easy-to-use website. It provides trade contacts and leads, educational information, and sales and marketing tools. Additionally, you can access a help desk, logistics information, reference materials, and a whole lot more.

Credit Insurance Pays If Your Overseas Customer Doesn’t

Published on Saturday, January 01, 2000

When you sell to a new customer overseas, do you worry that you’ll get paid in a timely fashion, or worse yet, not paid at all? If you’re like most exporters, the answer is yes. So what can you do about it? For many exporters, credit insurance is the answer — an alternative you might wish to consider if you haven’t done so.

Credit Insurance Guarantees Payment

Using credit insurance is easier than you may think. Used extensively in Europe for years and now becoming more popular in the United States, credit insurance can almost guarantee you’ll be paid for the goods and services you export.

When the foreign importer doesn’t pay for a variety of reasons, such as insolvency and bankruptcy, credit insurance covers your accounts receivable. Thus, the insurer will pay the balance owed. This will allow you to confidently plan your future growth, reduce administrative expenses, and get a tax deduction for the premiums.

Expand Sales and Improve Cash Flow

Manufacturers, service providers, banks, and transporters in the United States use credit insurance to expand sales and keep the non-payment of receivables to a minimum. Credit insurance speeds up turnover of accounts receivable and improves cash flow.

Once a credit insurer accepts your account, he investigates the credit background of your customers by using Credit Alliance, a global network operating in 39 countries which collects data from banks, trade organizations, government agencies, and credit and rating groups.

Political Risk Is Included

Credit insurance covers commercial risks which involve non-payment by buyers due to insolvency. It also insures payment for losses from a customer’s insolvency while the goods are in transit. Political risk also can trigger credit insurance payments. If the buyer can’t pay because political or economic events prevent or delay transfer of payments, credit insurance provides protection.

Collection and Recovery Service

If a customer is slow to pay, or doesn’t pay, the credit insurer also acts as a collection and recovery service. In short, credit insurance provides a lender with a secondary source of repayment. It enhances your ability to borrow and speeds up the approval process so your production isn’t slowed or stopped pending credit approval of the buyer.

There are a variety of credit insurance policies. One type is the whole turnover policy. It covers an exporter’s entire customer base against a number of risks, but the exporter usually retains a small share of a loss to reduce the premium.

Catastrophe Policy Costs Less

The catastrophe type of policy covers losses above a specified amount. Exporters whose customers pay their bills on time often buy catastrophe credit insurance to insure against any sudden bad debt that could cripple the exporter.

The premium is a small percentage (usually less than 1%) of covered sales, although the credit worthiness and location of your customers is also a factor. Credit insurance policies typically cover a one-year period.

Credit Insurers Around the World

Among the major underwriters of credit insurance are CNA of Chicago, American International Group Inc. of New York, Export-Import Bank of Washington, D.C., American Credit Indemnity in Baltimore, Coface Group of Paris, NCM Group of Amsterdam, Euler Group of Germany, Trade Indemnity in the United Kingdom, SFAC and SFF Factoring in France, COBAC in Belgium and Holland, SIAC in Italy, and Hermes in Germany.

Latin America’s Future Looks Bright: Short-term Country Prospects Differ

Published on Friday, October 01, 1999

The financial crisis that crippled much of Asia in 1997 destabilized financial markets in both developed and developing countries. As a result, Latin American growth, measured in real gross domestic product (GDP), fell from 5.4% in 1997 to 2.3% in 1998. The region’s difficulties were compounded by natural disasters that struck with unprecedented strength. However, given Latin America’s macroeconomic stability and commitment to free market policies, economic projections for the year 2000 are favorable — generating new opportunity for U.S. exporters and investors.

Read more

Mercosur: A Growing Market for U.S. and European Goods and Services

Published on Friday, October 01, 1999

The founding countries of the Mercado Comun del Cono Sur (MERCOSUR) — Argentina, Brazil, Paraguay, and Uruguay — have suffered from the economic slowdown in Latin America that began last year.

Nevertheless, U.S. exports to the trade bloc have increased 245%, from $6.5 billion in 1990 to $22.5 billion in 1998. And as we enter the new millennium, Mercosur imports are expected to continue to rise.

A History of Economic Liberalization

Formed in 1991, Mercosur was designed to stimulate members’ economies. To achieve this, the trade bloc proceeded to emulate the Chilean growth model, which was based on unilateral tariff reductions, privatization of publicly owned industries and services, and openness to foreign investment.

On January 1, 1995, Mercosur established a customs union, introducing a system of common external tariffs. As members opened their markets to greater competition and reduced inflation, production levels and demand for imports, especially capital goods, rose. By 1996, imports from member countries increased by 314%, compared with 185% from non-member countries.

Strained Internal Relations

Primarily because of Asian economic problems, recent economic growth in Brazil and Argentina decreased from 1997 levels. And the surprise 30% devaluation of Brazil’s real and abandonment of the fixed exchange rate in January 1999 boosted its exports. This, combined with poor regional growth, strained Brazil’s relations with the other Mercosur countries, especially Argentina.

During periods of economic decline, countries sometimes erect trade barriers to protect their industries from imports. Brazil and Argentina took that step. Consequently, trade between the two Mercosur members dropped 20% during the first six months of 1999.

Enter the European Union

During this time of fragile recovery, the leaders of the 15-nation European Union (EU) and Mercosur met in August to discuss a possible free-trade agreement. A significant impediment, however, is the highly subsidized EU farm sector, which effectively limits South American agricultural exports to the EU.

Nevertheless, EU-Mercosur negotiations may prompt the U.S. to renew talks to create a Free Trade Area of the Americas, creating a hemispheric free trade zone. Thus, a budding relationship between the EU and Mercosur sends a clear message that Europe could pose real competition for the U.S. in South America.

Franchising in Brazil

Brazil’s economy, the largest in South America, is rapidly expanding its presence in world markets. And franchising is becoming big business. With strong annual sales, the Brazilian franchise industry reached about $11.5 billion in 1997. Currently, two-thirds of the foreign franchises (66 companies) are headquartered in the United States.

The best franchising prospects include training courses, construction, and personal fitness. Other major non-franchise imports include crude oil, capital goods, chemical products, foodstuffs, and coal.

Argentine Privatization under Way

Argentina recently completed one of the world’s most ambitious airport privatization programs. And between 1999 and 2004, investment in airport infrastructure is expected to exceed $1.7 billion. Consequently, airport ground support equipment is anticipated to become a prime U.S. export to Argentina over the next decade. Other major projected imports from the U.S. include vehicles and parts, chemicals, telecommunications equipment, and plastics.

Calling Paraguay

Paraguay’s economy is largely service oriented. The need for improved communications has resulted in a significant demand for telephone and computer equipment. And the need for better transportation has brought about investment in road construction.

The country also has a large underground market, which involves thousands of micro-enterprises and urban street vendors, as well as the re-export of imported consumer goods and office equipment to Brazil and Argentina.

Geriatric Equipment for Uruguay

Uruguay’s proportionally large elderly population should be an attractive market for geriatric equipment and services in the near future.

Other favorable prospects for U.S. exporters include chemicals, manufactured goods, machinery, transport equipment, food processing equipment, and computer hardware and software.

Positive Economic Growth Ahead

With a population of more than 200 million people, a growing middle class, and positive economic growth predicted in 2000, trade among members of Mercosur and with the United States is anticipated to increase, offering U.S. exporters greater opportunities.