International Payment in Vn

Capital is the source of fiancé through which resources are provided. It may be debt financing

The company expects to deal in both import and export transactions, in a combination of documentary letter of credit and open account transactions. Its primary markets will be the United States, China, India and possibly a foray into the European Union through Ireland.

what was available for the suppliers of capital (that is, creditors and owners). An alternative cash flow,

Financial intermediaries are financial institutions such as bank, insurance company, credit union, stock exchange, and so on who works as a middleman

Consequences regarding the international businesses and the flow of trade and investment among the three countries are given below as benefits and drawbacks of holding fixed exchange rate system-

International business contains all business transactions private and governmental, sales, investments, logistics, and transportation that happen between two or more regions, nations and countries beyond their political limits. Generally, private companies undertake such transactions for profit governments undertake them for profit and for political reasons. It refers to all those business activities which involve cross border transactions of goods, services, resources between two or more nations. Transaction of economic resources includes capital, skills, and people. for international production of physical goods and services such as finance, banking, insurance, and construction.

Unquestionably, currency is the preferred payment medium for any export or import transaction—it is easy, fast, and straightforward to transact. Sometimes, though, compa¬nies must adapt to the reality that buyers in many countries cannot do so, whether due to the fact that their home country 's currency is nonconvertible, the country doesn 't have enough cash, or it doesn 't have sufficient lines of credit. Sometimes companies and coun¬tries find it practically impossible to generate enough foreign exchange to pay for imports. In recourse, they devise creative ways to buy products. For example, Indonesia traded 40,000 tons of palm oil, worth about US$15 million, with Russia in exchange for Russian Sukhoi

International finance is defined the study of international monetary economics, which involve the interaction of international transactions. (Investopedia, 2015) These transactions consist of factors, such as national income, money and prices. The international monetary system is made up of institutions, international organizations, governments, and private economic entities that all participate in the exchange of financial assets worldwide. (Smith, 2012)

When a country trade with another countries, there are records of all that transaction known as payment of balance, the benefit of having such a record is to know how much money is spent on import and export in goods and services. BOP consist in:

i. Find other factors or elements that come with the use of a certain source of capital, for instance social aspects.

International Monetary System refers to the system prevailing in world foreign exchange markets through which international trade & capital movements are financed & exchanges rates are determined.

The International Monetary Fund (IMF) was established in 1946, along with the World Bank. The IMF was developed to promote all monetary cooperation and remedy economic problems incurred during the post - war reconstruction period (Baylis; 2008: 245). The IMF was therefore considered as the “rule keeper” and an important component in public international management. In the pursuit to stabilise the exchange rate system, the IMF reserves the authority to change exchange rates. Another vital role is control over the balance of payments deficit of states and governing the policies which affect states monetary systems (Spero; 1990: 33). However, since the 1980 's, the IMF 's role has settled into the position of an institution providing assistance, based on financial situations, to developing countries. In order for countries to receive any assistance, the governments of those countries must agree to certain conditions set out by the IMF and the World Bank which permits the implementation of specific reforms provided by these institutions (Baylis; 2008: 245).

1. Describe the trading country’s economic system, economic information important to your proposed business/product/service, the level of foreign investment in that country

Again XYZ can improve its balance of payment account if the economy is protected. By restricting imports, a country may try to improve its balance of payments position. The developing countries, especially XYZ, may have the problem of foreign exchange shortage. Hence, it is necessary to control imports so that the limited foreign exchange will be available for importing the necessary items. In developing countries, generally, there is a preference for foreign goods. Under such circumstances it is necessary to control unnecessary imports lest the balance of payments position become critical.

As transaction and communication costs fall, the proximity between sellers and buyers, which has traditionally been considered to be essential for many services, figures less prominently. Most important in this regard is that financial capital has gone global. Nowadays, the financial centres of the world economy provide the possibility for 24 hour trading in all sorts of financial assets. The deregulation of other business services such as banking and insurance also offers new opportunities for the tradability of services. Hence, standardized business services have become available around the world, which, in turn, has made the international fragmentation of production feasible. As a consequence of all this, not only the constraints on firms, but also on governments have completely changed.