METHODS OF INTERNATIONAL TRADE AND PAYMENTS: THE NIGERIAN PERSPECTIVE (Published)
No country can exist in isolation as an island, trade wise. This is because, it cannot own all it needs or requires. It must therefore engage in some form of trade with other countries to buy what it needs and also, sell what it has. This way, it can maintain an economic balance. International Trade allows us to expand our markets for both goods and services that otherwise may not have been available to us. It is for this reason that a person in Nigeria can pick between a Japanese, German or American product such as, electronics or cars. Because of international trade, there is greater competition to provide cheaper products to the consumer so as to attract more trade relationships. International trading partners or organizations conduct business today without having to meet or speak with each other. Transactional, uncertainties about the method of trade or risk of loss could be increased if there is inadequate knowledge of the payment options that are available. As a result of such uncertainties, the likelihood of trade could therefore be reduced reduced. Because of awareness of the increasing globalization of trade, private sector development programs have looked for ways to implement trade promotion initiatives, through import and export programs, production of high-value crops for export, creation of business development centers and other trade related programs which require the participants to have a good understanding of some of the most critical aspects of trade such as the nature of trade and getting paid. As new technologies and advancements in communications are improving trade logistics and increasing speed and facilitation of transactions, businesses are finding new opportunities and new ways to operate. Today, payments can be made through opening of financial letters of credit, by email, commitments for foreign exchange can be made over the telephone and the purchase of large quantity of produce and their shipping costs can be charged to credit cards. Despite these new advancements most payment transactions still follow basic rules to reduce risk of loss to the barest minimum. Exporters must therefore offer their customers attractive sale terms supported by competitive payment methods to succeed in the new global market and to win sales against foreign competitors. As getting paid in full and on time is the primary goal for each export sale, an appropriate payment method must be chosen carefully to minimize the payment risk while also accommodating the needs of the buyer to get his goods at the cheapest possible rates.
Keywords: Export, Regulations., import, international trade payments