10 differences between home trade and foreign tarde?

Answer 1

Home trade is called domestic trade in some countries. These are the differences as seen by me.

1. For home trades, payments could be made in home currency only. Foreign trades are to be paid invariably in convertible currencies.

2. Home trades generally have no restrictions of movement within the country. In international trade, there are restrictions as to movement of specific goods to specified countries.

3. Home trades have taxes levied by the Government and local bodies. International trades have levies called customs duties. These invariably go to the Federal Government.

4. Documents for domestic trades are comparatively simple and easy to understand and follow. Foreign trades have a different set of documents which must be filed in every case.

5. Insurance of consignments sent on foreign trade are compulsory; in home trade it is optional.

6. Usually, foreign trades are preceded by payment or promises of payment made by international foreign exchange traders (also called Letters of Credit.) In domestic trades, payments are realised usually after the trade is executed. Depending on the credit rating of the parties concerned, even a simple promise is not taken. Letters of Credit in domestic trades is not common but not ruled out.

7. Credibility of parties can be got verified in foreign trades through the trade representatives of the countries involved in the transaction.

8. On receipt of consignment at a foreign country, the documents are handed over to the buyers only after payment is realised. Thereafter, the Banks concerned remit the payments to the sellers through normal international banking channels. In respect of domestic trades, bankers may or may not be the intermediaries. Payments can be directly sent to the sellers by the buying party.

9. Under the United Nation's charter, goods prohibited for specific countries cannot be sent to them by member countries. Penalties extending to boycott of trade with that country may follow. In domestic trades, such prohibitions do not exist. (Example: selling atomic energy raw materials to Iran, Iraq etc.)

10. International trades are further government by agreements between member countries of General Agreement on Tariffs and Trade. Domestic or home trades are not subject to such agreements.

Answer 2

1. Home trade refers to the buying and selling of goods and services within the borders of a single country, while foreign trade involves trading goods and services across international borders.
2. Home trade is subject to domestic laws and regulations, while foreign trade is governed by international trade agreements and treaties.
3. Currency used in home trade is typically the national currency of the country, while foreign trade involves currency exchange and may be subject to fluctuations in exchange rates.
4. Home trade often involves lower transportation costs and shorter delivery times compared to foreign trade, which requires shipping goods across longer distances and sometimes through multiple countries.
5. Home trade may benefit from established relationships and networks within the country, while foreign trade requires building relationships with international partners and understanding different cultural practices and business norms.