Page 14 - Countertrade

Compensation

Compensation trade is a form of barter in which one of the flows is partly
in goods and partly in hard currency. Essentially, the seller receives a
part of the payment in cash and the rest in form of products.

Payment in
Payment in

cash the form of
goods

Compensation
Deal

General Motors Corporation sold $ 12 million worth of locomotive and
diesel engines to Yugoslavia and took cash and $4 million in
Yugoslavian cutting tools as payment. (4)

McDonnell Douglas agreed to a compensation deal with Thailand for
eight, top of the range F /A – 18 strike aircraft. Thailand agreed to pay
$578 million of the total cost in cash, and McDonnell Douglas agreed to
accept $93 million in a mixed bag of goods including Thai rubber,
ceramics, furniture, frozen chicken and canned fruit. (4)

Compensation

Raw Materials

Payment in Cash
Seller Buyer

Goods and/or services