Week four - internationalisation promotion policies Flashcards
what are the main objectives of public promotion policies
- help overcome obstacles to export
- support SMEs and new exporters
- expand the number of exporters
- the existence of similar policies in other countries
- counterbalance other public policies that might discourage exports
examples of state public organisations in spain
- Spanish institute for foreign trade
- Spanish company for export credit insurance
example of regional public organisations and what they focus on
valencian institute for firm competitiveness
- innovation and R&D
- internationalisation
- other (energy, finance…)
types of industry and multi-industry organisations
firm associations
- industry associations
- multi-industry associations
- exporters associations
chambers of commerce
- export promotion chamber plan
- chamber of valencia, castellon, alicante, alcoy…
why is obtaining information and advice important as a promotion instrument
it is vital to make the decision on whether to start the process of internationalisation (internal analysis) and to define the internationalisation strategy (external analysis)
what is the main information promotion agencies should provide and examples
relevant information on foreign markets:
- publications
- economic reports
- supplies and demands
- stats
assessment on foreign trade:
- procedures and formalities
- tariffs and other barriers
- transport and logistics
- contracts
what is the objective of firm-specific promotion programmes
to promote access to foreign markets and to improve its external competitiveness
what criteria is public support often subject to
- co-financing
- priority for SMEs
- preference for emerging countries
- justification of aid
- reimbursable expenses
what is the form of business cooperation for internationslisation
agreement between two or more independent companies, sharing their skills and resources, establishing (without merging) a degree of commitment in order to increase their competitive advantage
what are the advantages of business cooperation
- increased operational dimension/capacity
- exploit synergies
- reduced costs
- expand the supply of exportable products
- compehensive solutions for all firms cooperating
most commonly used methods of business cooperation
- export consortium
- groups of international promotion
examples of training used for promotion instruments
- countries/sector specific workshops
- seminars
- scholarships
types of funding used for promotion instruments
- bilateral funding
- multilateral funding
- exporter and importer finance
what type of funding is ‘official export credit and FAD’ and what is it
- bilateral funding
- it is a set of financial arrangements to promote Spanish exports by providing credit with official support
what are some characteristics of the official export credit and FAD
- long returning period for loans
- interest rates below those applied in the financial market
- eliminates the risk of interest rate by maintaining a fixed rate throughout the life of a loan
- assuring the political risks through CESCE
what is the ‘general agreement on guidelines for export credits officially supported’ and its goal
- it establishes the guidelines for export credit support or state official credit
- its goal is to stop unfair competition between countries in terms of financing terms and interest rates for credits officially supported
main guidelines of the ‘general agreement on guidelines for export credits officially supported’
- loans with a repayment period of 2 years or more
- equipment and working plants produced in Spain
- interest subsidised
- military equipment and agricultural products are excluded
- involvement of private banks in this type of financing is secured by the reciprocal interest adjustment convention (CARI)
what are FAD credits (development assitance funds)
financial facilities granted to developing countries
what is the objective of FAD credits
- support the internationalisation of spanish companies
- promote the development of recipient countries
what two funds are the FAD credits split into
- development promotion fund (FONPRODE), managed by the ministry of foreign affairs and cooperation
- fund for the internationalisation of Spanish companies (FIEM), managed by the ministry of industry, tourism and trade
what are some promotion instruments of insurance
- insurance policies for exporters
- factoring services
- forfaiting
what are some investment abroad (FDI) programmes that aid with internationalisation
- support program for investment projects
- credit line supporting foreign investment
- investment advisory programs
- business accompanying support
- funding for major projects
what are some fiscal instruments that aid with internationalisation
- VAT rebate on exports
- export tax incentives (tax credits in corporate taxes)
- tax incentives for investment abroad (tax credits in corporate taxes)
- double taxation agreements
