6. Summarize the information of the unit and speak on the topic: The Stock Exchange, Bonds

Unit 7 Foreign Trade

The importance of foreign trade in our world is great, practically all countries buy and sell goods and services. Such goods as food, cars, medicines, books and many others are called visible. Services such as insurance, tourism are invisible. The total amount of money a country makes including money from visible and invisible export (usually for a year) is its Gross National Product or GNP. And the difference between some country’s total earnings and expenditures is called the balance of payments.

Business transactions usually start with enquiries. In them the prospective buyer states what goods exactly he is interested in and asks for details on the price and terms of delivery. In reply he can get an offer with all the necessary details.

When goods are sent from a Seller to a Buyer, each party has to know exactly which of the costs and risks of transportation he has to bear. In order to avoid disagreements, the sales contract usually stipulates one of the 13 terms of delivery drawn up by the Chamber of Commerce. These are known as incoterms (International Commercial Terms).

Most frequently used terms of delivery in international trade are CIF (cost, insurance, freight) and FOB (free on board).

According to CIF terms the Seller pays for the transportation to the port of shipment, loading, freight and insurance. That means the Buyer pays for unloading and for the goods to be transported from the port of destination to the warehouse.

According to FOB terms the Seller pays for the transportation of the goods to the port of shipment and the loading costs. The Buyer pays for everything else (freight, insurance, unloading and transportation from the port of destination to his warehouse).

The price will certainly depend on the terms of delivery.

When doing business with companies abroad it is important to have more control over payment. A Letter of Credit overcomes the gap between delivery and payment and it's secure both to the Exporters and to the Importers.

A Buyer opens a L/C with a bank in his country. This bank transfers money to a bank in the Seller’s country, which informs the Seller that a sum of money is available when shipping documents (such as a Bill of Lading, Commercial Invoice and others) are presented. The documents prove that the goods sold have been loaded on board a ship.

A Letter of Credit protects the Sellers by making the money available for them on the fulfillment of the transaction and the Buyers because they know that payment will only be made against shipping documents which give them the title for the goods.

visible (adj) - видимый

ant. - invisible - невидимый

insurance (n) - страхование

to insure smb. against smth. – страховать кого-либо от чего-либо

Gross National Product – валовый национальный продукт

balance of payments – платежный баланс

enquiry (n) - запрос

terms of delivery – условия поставки

bear (v) – нести (издержки, расходы)

stipulate (v) – обусловливать, определять

CIF (cost, insurance, freight) – СИФ (стоимость, страхование, фрахт)

FOB (free on board) – ФОБ (свободно на борту)

loading (n) - погрузка

unloading - разгрузка

to load (v) - грузить

freight (n) – фрахт (перевозка груза судном)

destination (n) – пункт назначения

port of destination – порт прибытия

warehouse (n) - склад

shipment (n) – отправка, отгрузка, партия товара

port of shipment – порт отгрузки

A Letter of Credit – аккредитив (письмо, адресованное одним банком другому ,в котором содержится указание выплатить лицу, названному в письме, определенную сумму денег при определенных оговоренных условиях)

Shipping documents – отгрузочные (транспортные) документы – документы, которые экспортер товаров (продавец) передает банку своей страны в целях получения платежа за товары.

Bill of Lading – коносамент – документ, подтверждающий отправку товаров морем грузоотправителем.

Commercial Invoice – коммерческий счет-фактура - содержит описание товаров, где и когда они были отправлены продавцом, условия оплаты.

title (n) – право (собственности)