U.S. Domestic Barter : an Empirical Investigation

This paper studies the barter industry developed in North America during he 1950s, pointing ut some of its main characteristics. Thus, it examines its two main sectors : (i) Corporate Barter and (ii) Commercial Barter. Contrary to expectations, the analysis of official data shows that this phenomenon is essentially pro-cyclical for the Commercial Barter component. Moreover, commecial barter activity turns out to be complementary to the cash economy. While the two sectors display some differences in their pattern, they both help firms to increase their profits.E-Barter; Corporate Barter; Economic Cycle

El comercio de compensación en períodos de crisis

El comercio de compensación consiste en operaciones internacionales o nacionales en las que las empresas se comprometen a aceptar el pago en forma de bienes o servicios. Hay muchas formas de intercambio compensatorio, que van desde simples a complejos acuerdos de trueque, incluidas ofertas que implican acuerdos de compensación en relación con el comprador. El comercio de compensación usualmente se lleva a cabo entre las empresas privadas en los países desarrollados y los gobiernos de los países en desarrollo, aunque también se produce el intercambio compensatorio entre los países desarrollados. Se ha extendido como una forma de financiar operaciones comerciales para reducir los riesgos o superar los problemas relacionados con las divisas. Históricamente, el comercio de compensación ha tenido más éxito en periodos de crisis económica.Countertrade is a category of international or national trade in which an enterprise agrees to accept payment in the form of goods or services. The number of alternatives being used as mechanisms for the exchange of goods and services has grown in volume and acceptance. There are many forms of countertrading, ranging from simple barter agreements to complex offset deals that involve the exporter agreeing to compensatory practices with respect to the buyer. Countertrading commonly takes place between private companies in developed nations and the governments of developing countries, although countertrading also occurs between developed nations. It has become popular as a means of financing international trade to reduce risks or overcome prob¬lems associated with various national currencies. Historically, countertrading has expanded when international economies have been sluggish or in periods of recession.peerReviewe

Countertrade: Can We Afford to Ignore the Impact on the World Market?

In recent years the issue of countertrade has received more and more attention. In this examination of countertrade it is the aim to create first, an understanding of what countertrade is and how the particular forms are used. The reader will understand that essentially there are five forms I of countertrade, barter; counterpurchase; compensation; t offset; and switch. Upon this comprehension an analysis of the buyer and seller\u27s perspective is discussed. When a firm or country contemplates the use of countertrade it is necessary to understand which form of countertrade to use and how other parties will view the form of countertrade you choose. An integration of this literature with countertrade across the globe becomes vital to clarifying the importance of this subject matter. In order for the United States government to understand the necessity of countertrade it is important to exemplify the many uses of this form of international trade. After reading this analysis of countertrade one will see that countertrade supports economies of developed as well as undeveloped countries. Estimates place countertrade at 20-25% of world trade, and some reports suggest that it can be as high as 45%

Countertrade as a development tool: a comparative analytical approach

This study explores the consequences of defence countertrade arrangements for national development based on the South African experience in comparative perspective. Although defence countertrade has been controversial in many contexts, it is concluded that it may play a positive developmental role. This is premised on the central role governments can play in ensuring that countertrade's role in national economic development – global pressures and neo-liberalism notwithstanding – remains an important tool through which active industrial policy may be pursued. This can include developing and maintaining a defence industrial base (DIB) in those countries that have such capabilities. Countertrade occurs under two kinds of market conditions. The one is where there is a natural need for trading but it is constrained in some way, for example, by an absence of currency or an oversupply. Under these conditions countries can resort to bartering, which involves a commodity for commodity exchange and no money. The second market condition is one where countertrade is purposefully structured to secure reciprocal benefits as a condition of a commercial sales transaction - defence or civil in nature. This is referred to as leveraged procurement and manifests primarily as defence offsets involving the defence industrial base, which is the concern of this study. Around 40 per cent of countries, including South Africa, use various purposely structured government procurement programmes when procuring goods and services abroad. These programmes apply the principle of reciprocity through the use of internationally accepted countertrade practices that manifest in many diverse ways. Although „countertrade‘ is the collective term, it is regularly referred to as „offsets‘. Procurement leverage is used to secure some reciprocal benefit from the foreign seller (benefits sought vary from country to country). Countertrade-related practices occur widely despite the fact that the World Trade Organisation's (WTO) Agreement on Government Procurement (GPA6) rules out the use of offsets. Their use is viewed as a discriminatory procurement practice that interferes with free trade. However, the WTO allows for exceptions in the case of developing countries and also for national security and public health contracts. It is important to note that countertrade (and offset) practices, valued in billions of US Dollars, are applicable mostly to defence contracts, although becoming increasingly relevant in non-defence (i.e. civil) government procurements. This research systematically interrogated and investigated issues surrounding the origins and subsequent popular and increased use of countertrade since the 1980s. The purported negative impact of defence-related offsets on the defence industrial base (i.e. the loss or gain of jobs, technology and market share) of both the exporting and receiving countries is of particular concern to the US government and the European Union (EU). My exploratory mixed method research, together with practitioner (insider) and reflexive research approaches, culminated in a primarily descriptive, qualitative, analytical narrative. The research is further founded on structured survey questionnaires. These specific research approaches are known to be subjective and biased and I thus needed to take extra care to prevent emotive subjectivities, primarily through triangulating my findings against a variety of other views and arguments pertaining to the research question. This was done to provide for a holistic overview, and in consideration of the case study, in particular. It must be noted that South Africa has two sets of industrial participation policies and practices. One is Defence Industrial Participation (DIP) managed exclusively by Armscor, South Africa's acquisition agency, which favours pursuing defence industry development objectives. The other is the National Industrial Participation Programme (NIPP), managed independently by the Department of Trade and Industry (DTI). The NIPP is primarily focused on the civil industry with a bias towards manufacturing, investments and exports. The DIP is the focus of the case study element of this research. Since its inception in 1968, Armscor has been tasked with establishing a DIB. Until the late 1980s, this DIB made huge strides in developing unique defence equipment to cater for the harsh Southern African environment and its military operational conditions. The DIB's development was enhanced further by the various UN embargoes imposed on the former South African apartheid government. Owing to these embargoes, Armscor dealt with all its defence imports (and exports) in a clandestine manner. Armscor was the only government entity that applied countertrade from around 1988 until 1996 when the DTI introduced NIPP. During the latter part of 1996, Armscor redrafted its countertrade policy with the new DIP policy approved in early 1997. This policy was applied during the biggest arms transaction in South Africa‟s history, namely, the Strategic Defence Package (SDP). A DIP commitment of circa R15 billion resulted from the equipment bought under the SDP. This study investigated how the DIP manifested in practice from 2000 to 2012 within the DIB that involved numerous South African Defence Industry (SADI) entities. The study considered the DIB, its growth and decline, and to what extent the DIP assisted it to retain its capabilities and capacities, including the retention of jobs. Hence, parts of the case study cover issues related to the South African military complex and the SDP‟s selection process. Subsequent investigations into alleged acts of misconduct and maladministration in the selection process, fraud and corruption are also covered, although not in detail, since this matter is sub judice the outcome of the 2011 presidential appointed Arms Procurement Commission (APC) of inquiry that is anticipating completing its investigations in 2015. Although there are many derivative views on the actual defence equipment needs of the South African National Defence Force (SANDF), the study did not endeavour to analyse these views in depth as they are adequately covered in the 1996 Defence Review. Similarly, there are views expressed that South Africa paid much more for its equipment compared with similar types of equipment bought by other countries. A cost comparative analysis was not performed as the exact configuration of each type of equipment can differ substantially due to the unique operational needs of the various defence forces – the exact configuration of such equipment is not in the public domain, since it is a sovereign security concern. Despite many opposing views, it is concluded that DIP (also referred to as defence offsets) has worked for South Africa: in many ways the South African DIP practice compares favourably with internationally accepted best practices. The research‟s postulation that countertrade can be used as a possible development mechanism is therefore supported by the findings of this study that showed that DIP had a positive retention impact on the DIB, and jobs, and made a positive contribution to Gross National Product (GNP7). The study found that the 1997 DIP policy needed to be much better aligned with the broader strategic national industrial development aims and objectives, including better corroboration with the NIPP. In this respect critical inferences are made that the DIP policy primarily focused on the SADI and its capabilities, without considering its wider application in a broader industrial sense. However, in the context of the Armscor legal mandate (i.t.o. Act 57 of 1968) ensuring the establishment of a DIB in South Africa, the DIP policy was clear in its intent to specifically further the interests of only the SADI. However, the 2014 Defence Review recommends that the DIP policy should be much more focused and even prescriptive when considering specific strategic defence needs. Although DIP policy directives contain requirements for establishing strategic local capabilities and capacities that could adequately cater for logistic support, repair and maintenance of foreign produced defence equipment, this aspect was not well contracted in the 1999 SDP. There is also general consensus that foreign obligors should in future not be allowed the freedoms of choice evident in the SDP‟s DIP process, which resulted in numerous smaller companies not benefitting as was generally anticipated. Future defence contracts should not be signed without an appropriate DIP business plan. Hence, all indications are that the DIP regime in South Africa is set to become much more stringent in its application and subsequent discharge administration

O fracasso das contrapartidas

As contrapartidas são compensações, compras ou investimento, que um estado adquirente exige a um fornecedor estrangeiro pela importação de sistemas dispendiosos. A liberdade de circulação de capitais, a integração e o Euro esvaziaram a motivação original das contrapartidas na Europa. Mas a compensação das importações apela ao mercantilismo, ao proteccionismo e aos media, pelo que as contrapartidas persistem. Elas são hoje um “digestivo” das importações impopulares (como o material militar) ou muito dispendiosas (como aviões comerciais). Os benefícios estão por provar, mas os custos e o desperdício são conhecidos e medem-se em longas e complexas negociações dos contratos, em litígios por incumprimento, que distraem as alegadas empresas beneficiárias da inovação e das actividades produtivas, e falta de transparência dos processos. Por isso, apesar da “boa imprensa”, as contrapartidas são uma má ideia e um fracass

Countertrade and the choice of strategic trading form

Reciprocal trade agreements, usually known under the generic name of countertrade (CT) have been traditionally seen as a form of bilateralism, and thus as an inefficient form of international exchange. Although contemporary trade theories do not fully explain the increasing prevalence of CT transactions, we will argue that it is possible to construct and use a third (hybrid) institutional form, which is congruent with the transaction-cost theories, and we will show how — under market imperfections — countertrade can reduce transaction costs while conserving the efficiency gains generated by these specific arrangements.Publicad

L'analyse des offsets dans l'optique de la théorie de négociation : l'offset garantit-il la meilleure valeur possible d'un achat public ?

Notre objectif dans cette contribution est d’offrir un cadre d’analyse qui permettra d’évaluer l’efficience et l’efficacité d’une politique d’offset imposée par le gouvernement aux firmes internationales (unilatéralement ou en concertation) avec un effort clair d’influencer la distribution des gains. Cette analyse en dynamique permet ainsi d’introduire la composante politique et démontre le caractère évolutif des relations entre une entreprise multinationale et le pays hôte, qui est fonction du changement observé dans les objectifs, dans les ressources et les contraintes de chacune des parties. Dans une première partie, nous présentons la pratique d’offset et son rôle dans les politiques économiques des pays. La deuxième partie établit le cadre d’analyse d’économie politique nationale à partir duquel seront étudiés les effets des pratiques d’offset. Dans la troisième partie une méthode à suivre est présentée pour évaluer dans quelle mesure et à quelles conditions une politique d’offset peut être efficace ou comment faire pour que l’offset garantisse la meilleure valeur possible des achats publics