Foreign trade export means that some countries, based on their own political, military and economic interests, adopt national laws and administrative measures to manage and control their own export trade. So what are the ways to export foreign trade? What are the payment methods? Let's take a look.
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Foreign trade export method:
Import and export trade methods: general trade; compensation trade; processing and assembly trade with supplied materials; processing trade with imported materials; consignment and agency trade.
General trade refers to the unilateral import or unilateral export trade of enterprises with import and export rights in China.
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Compensation trade is a trade method in which products are used to reimburse the costs of imported equipment and technology in international trade.
Processing and assembly trade with supplied materials means that foreign businessmen provide all raw materials, auxiliary materials, parts, components, accessories, and packaging materials, and provide equipment when necessary, and the processing unit of the undertaking party will process and assemble according to the requirements of the foreign businessmen.
Imported processing trade refers to the transaction form in which we use foreign exchange to purchase imported raw materials, auxiliary materials, parts, components, accessories, packaging materials, etc., and then sell them for export after processing finished or semi-finished products.
Consignment and agency trade means that the consignor delivers the goods to the consignee agreed in advance, and the consignor sells the goods in the local market in accordance with the conditions agreed in advance or in accordance with the conditions stipulated in the consignment agency agreement.
Foreign trade export payment method:
1. Letter of Credit (Letter of Credit, L/C for short)
There are many types of letters of credit. It is a type of issuing bank that issues a certain amount of money to the beneficiary (exporter) in accordance with the requirements and applications of the applicant (importer), and within a certain period of time, they can present the bill of exchange and export documents at a designated location. Written guarantee of payment.
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A letter of credit is a payment commitment made by the issuing bank to the beneficiary, so that the beneficiary has the protection of the collection, so it is a favorable payment method for the beneficiary. But the beneficiary can only get the payment when the documents required by the letter of credit are provided in accordance with the provisions of the letter of credit. Therefore, the letter of credit is a conditional payment commitment of the bank.
2. Remittance
Remittance mainly includes three types: Telegraphic Transfer (T/T), Mail Transfer (M/T) and Demand Draft (D/D).
3. Collection
Collection mainly includes two types: Documents against Payment (D/P) and Documents against Acceptance (D/A).
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