Page 24 - Countertrade

Countertrade relates to sales transactions where commodities are used
as payment instead of hard currency and is especially useful when doing
business in markets with currency problems and in economies suffering
from hyperinflation. Moreover, it facilitates the conservation of foreign
currency, which provides an alternative to traditional financing that may
not be available in developing nations. Other benefits include:

1 •Shortage of convertible currency

2 •Fighting inflation
3 •Relieves deficit payment

4 •Higher sales

5 •Reduces the volume of external debt
6 •Stimulation of jobs and Industry

7 •Facilitates the entry of technology

8 •Better capacity utilization
9 •Facilitate the development of new markets
•Stops processes unfair competition from third
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countries
11 •Reduces external marketing costs

12 •Ease of entry into challenging markets