countertrade

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Countertrade

See: barter

Countertrade

The exchange of goods and services for other goods and services. Countertrade is relatively common in trade with or between cash-poor countries. Most economists estimate that countertrade accounts for between 20% and 25% of global trade volume. See also: Buyback, Switch trading, and Counter purchase.

countertrade

the direct or indirect exchange of goods for other goods in INTERNATIONAL TRADE. Countertrade is generally resorted to when particular FOREIGN CURRENCIES are in short supply, or when countries apply FOREIGN EXCHANGE CONTROLS.

There are various forms of countertrade, including:

  1. BARTER – the direct exchange of product for product;
  2. compensation deal - where the seller from the exporting country receives part payment in his own currency and the remainder in goods supplied by the buyer;
  3. buyback - where the seller of plant and equipment from the exporting country agrees to accept some of the goods produced by that plant and equipment in the importing country as part payment;
  4. counterpurchase - where the seller from the exporting country receives part payment for the goods in his own currency and the remainder in the local currency of the buyer, the latter then being used to purchase other products in the buyer's country See EXPORTING.

countertrade

the direct or indirect exchange of goods for other goods in INTERNATIONAL TRADE. Countertrade is generally resorted to when particular FOREIGN CURRENCIES are in short supply or when countries apply FOREIGN EXCHANGE CONTROLS. There are various forms of countertrade, including:
  1. BARTER: the direct exchange of product for product;
  2. compensation deal: where the seller from the exporting country receives part payment in his own currency and the remainder in goods supplied by the buyer;
  3. buyback: where the seller of plant and equipment from the exporting country agrees to accept some of the goods produced by that plant and equipment in the importing country as part payment;
  4. counterpurchase: where the seller from the exporting country receives part payment for the goods in his own currency and the remainder in the local currency of the buyer, the latter then being used to purchase other products in the buyer's country. See EXPORTING.
References in periodicals archive ?
The Russians agreed to supply a light-water nuclear reactor in a counter-trade deal with part payment in rice, teak, and rubber, and in June 2001 a contract was drafted (Luchin 2002; Lintner 2002).
He agreed to a counter-trade deal in palm oil and an offset programme which would allow local manufacturers to provide spare parts for the MiG-29.
In terms of arms sales, Russia's success with Malaysia was promising but in comparison with the long-term deals Russia had negotiated with China and India it was less rewarding than expected, considering the highly unpopular counter-trade agreement that was required.
Putin became Russia's premier arms salesman exploiting price advantages and the incentive of counter-trade deals to exploit new markets in ASEAN.
In December 2003 Vietnam purchased four SU-30MKs for a total of US$150 million, of which 30 per cent was counter-trade.
The price was a reported US$900 million, 30 per cent was counter-trade payable in palm oil.
The deal, however, was criticized on the Russian side as counter-trade was unpopular with the Russian aviation industry, which wanted payments in hard currency to recoup investment and R&D (research and development) costs.
Offset programmes in the Middle East are undergoing tremendous changes to reflect evolving national defence requirements and the increasingly sophisticated approaches to offset and counter-trade operations worldwide," said Saif Mohammad Al Hajeri, Tawazun's Chief Executive Officer.
The conference also aims to identify best ways to strengthen cooperation and share information within the offset and counter-trades global culture.
The contract enters in to force when a separate counter-trade agreement has been signed with the Polish authorities.
Mazur served as the Counter-Trade Division Representative in Poland for the world renowned Cargill International S.
Mazur was the Counter-Trade Representative for John Deere Export, a Division of Deere & Co.