International Trading

DEFINITION INTERNATIONAL TRADE OR EXPORT

The term export means shipping goods out of the port of a country. The seller is referred to as an exporter and is based in the country exporting and the buyer is referred to as an importer. In other words the word export means selling goods and services to other countries than your home country. To export commercial goods normally requires involvement of the customs authorities in both the export and import countries. International trade simply refers to the exchange of capital goods and services across international borders and territories. While international trade has been ongoing over centuries, its economic, social and political importance has been steadily climbing over the past few years. International trade are however reliant on peace and stability between trading countries. To trade globally gives suppliers and consumers a vastly bigger exposure to goods or services not available in their own country. Industrialization, advanced technology transportation, globalization, multinational corporations as well as outsourcing, all have a major impact on international trading. Although international trade is similar to domestic trade, it is more costly because of border tariffs and it is also more time consuming because of border delays as well as the difference in language, legal systems and cultures. Factors of labor and capital are also more mobile domestically than across borders. 

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HISTORY

To outline the history of international trade, you cannot focus on one nation, there were a number of important chain of events that made way for today’s modern international trade. According to an ancient Greek manuscript written in the first century, there were extensive trading between the Romans and the Indians. They traded spice and incense and made use of the overland caravan routes via Asia Minor and the Middle East. With the invention of sea vessels, they started trading via the Red sea and monsoons around the beginning of the Common Era. This route played a large role in enhancing the trade. In the ancient period it would seem that South Arabia and the Horn of Africa were the major suppliers of incense. The Horn of Africa denotes the region containing the countries of Eritrea, Djibouti, Ethiopia and Somalia. The long-debated ships of Tarshish, as a Tyrian fleet equipped at Ezion-Geber made several trading voyages to the east, bringing back gold, silver, ivory and precious stones. These goods were transshipped at the port of Ophir. The Egyptians also carried out extensive trading over the red sea. They imported spices from Arabia and the “Land of Punt” which is also called Pwene by the ancient Egyptians. It was said to be an old Kingdom producing and exporting gold, aromatic resins, Blackwood, ebony, ivory and wild animals. The region is known from ancient Egyptian records of trade expeditions, but the exact location of the “Land of Punt” are still debated by historians. It is possible that the location covered the territory of both the Horn of Africa and Southern Arabia. People belonging to the Kingdom of Quataban, cultivated and traded aromatics as well as spices. The Kingdom’s economy was reliant on this trade. Spices and aromatics were exported to Abyssinia, Mediterranean and Arabia. Myos Hormos and Berenice were the two main trading posts during the first century in Roman Egypt for trade with India, Africa and in later years China and Arabia as well. Pre Islamic Meccans benefited from demand of Romans for luxury items. To trade they used the Legendary Incense route. This route started 2000 years ago. In that time, they did not have transport, roads or maps. They used long caravans of camels and traversed difficult trails, navigating through areas with robbers, looters, obstacles and narrow minded rulers. The 2,400km Incense route took about six months to travel. The camel caravans included thousands of individuals, moving at a sluggish pace, and passing through 56 stops where they rested and took care of the animals. Following the demise of the incense trade, Yemen takes to exporting coffee via the Red sea port of Al-Mocha. To fast forward to the more recent or modern ages there were a few significant incidents that had an enormous impact on trade. 

They are as follow:

1. Due to the Turkish hold on the Levant during the second half of the 15th century the traditional spice route shifts from the Persian Gulf to the Red sea.
2. Spanish Expedition commanded by Christopher Columbus discover America in 1492.
3. Portuguese explorer Vasco da Gama establishes another sea route from Europe to India.
4. In 1643, Jan van Riebeeck travelled to the VOC outpost at Dejima in Japan. Seven years later in 1650, he proposed selling hides of South African wild animals to Japan. In 1651 he volunteered the command of the initial Dutch settlement in the Future South Africa. He landed three ships namely the Dromedaris, Reijger and Goede Hoop at the future Cape Town on 6 April 1652.
5. Japan introduced a system of foreign trade licenses to prevent smuggling and piracy in 1592.
6. The first Dutch expedition left from Amsterdam for East Asia in April 1595.
7. The first English outpost in the East Indies is established in Sumatra in 1685.
8. In 1639 Japan introduced a closed door policy and only allowed a very selective trading to the Dutch and Chinese.
9. In 1799, The Dutch East Company, formerly the world’s largest trading Company goes bankrupt, partly to the rise of competitive free trade.
10 The Opium war in 1840, Britain invades China to overturn the Chinese ban on Opium imports.
11 Despite the late entry of the United States in to the spice trade, merchants from Salem and Massachusetts traded profitably with Sumatra during the early first half of the 19th century. The Siamese-American Treaty of 1833 calls for free trade, except for export of rice and import of munitions of war.
12 The first international free trade agreement, the Golden-Chevalier Treaty, is finalized in 1860 between the USA and France.

This sparks off agreements between other European countries.

INTERNATIONAL TRADE OF SOUTH AFRICA

South Africa’s international trade was largely affected by sanctions and boycotts from 1980 to early 1990. These measures included a voluntary arms embargo instituted by the United Nations in 1963. This was declared mandatory in 1977. Throughout the twentieth century, South Africa’s economy has depended largely on international trade. Gold dominated its exports to the point that the Government occasionally intervened to promote non-gold products. International trade delegations began arriving in South Africa as international sanctions were being lifted in the early 1990’s. In this time South Africa sent a delegation to Moscow in mid- 1991 to discuss strengthening trade ties, and for the first time South African companies participated in a fair trade. South Africa’s main trading partners in the mid-1990 were West European countries, America and Japan. South Africa’s trade with the rest of Africa was carried on both openly and clandestinely up until the 1990’s. After that as commercial ties expanded, other African countries purchased about ten percent of South Africa’s exports. Zimbabwe, Zambia and Mozambique were the largest African markets. Only Zimbabwe supplied South Africa with mainly tobacco. Official South African trade statistics include all members of the Southern African Customs Union (SACU). This aroused out of the customs agreement between South Africa and the territories that became Botswana, Lesotho and Swaziland. Namibia joined the customs unit when it became independent in 1990. 

IN CLOSING

International trading has come a long way and today we are in the fortunate position to enjoy a huge variety of products and services globally. Companies also have the freedom to explore over the border markets for their goods. There is a lot of aspects to consider when exporting or importing a product. The best way is to partner with an international trading Company that has experience and a highly reputable reputation. Although there is excellent companies in our other slots that has international status, they still use a third party to export. The international companies listed in the international slot has one or two hubs or depots in South Africa, and a vast footprint globally. They specialize in import and export and most of South African based Logistic, wholesale and manufacturing companies use them as third parties for export. Because Export has become highly competitive and superior service delivery could give you the edge, we provide you with the five best specialists in their field. Put your business in the hands of professionals and have peace of mind.