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CurrencyFluctuationsandForeignExchangeWhentheMexicancurrencycrisisbeganinlate1994,the...
Currency Fluctuations and Foreign Exchange
When the Mexican currency crisis began in late 1994, the Wall Street Journal reported that within a week the peso had lost almost 36 percent of its value against the dollar, and 43 percent since the beginning of the year. This highlights the significance of the impact of currency value fluctuations on international business negotiations. International firms that negotiated business deals or operations in Mexico should have taken the risk of the peso devaluation into account during their negotiations with Mexican firms.
International business transactions take place in a world of multiple currencies, the values (foreign exchange rates) of which fluctuate daily. A business deal that is not effectively structured to compensate and protect against foreign exchange fluctuations is likely to be a prelude to a disaster if the underlying currencies in which payments are to be received precipitously decline in value--or a windfall if they appreciate in value--against the recipient company's home currency or other stable currencies. It would be prudent for negotiators of both companies to obtain realistic "most likely" forecasts of the exchange rates for the relevant currencies from such reliable sources as international banks and currency futures markets. They can thus build into the agreement contingency clauses that would protect either side from wild swings in the exchange rates of their respective currencies or engage in currency hedging contracts.
Foreign exchange controls by many governments also influence international business negotiations. The ability of a company to pay for imported raw materials, or to repatriate profits or dividends to a foreign parent, depends on the willingness of the host government to make the necessary foreign exchange available for such transactions. Negotiators for a foreign company must ensure that, in whatever agreement is negotiated, provisions are made that would avoid or blunt the effect of these controls. For instance, in the face of foreign exchange restrictions, an international company could negotiate a "counter-trade" deal by which payment is made in goods, rather than cash.
Foreign Government Controls and Bureaucracy
The extent of governmental interference in business in many nations is extensive. Government agencies may have the authority to control the total output of an industry. Or they may have absolute control over the granting of permits to expand production capacity. A company with the potential to increase market share is obligated to obtain the necessary license to expand capacity, a license that is often denied by government bureaucrats. 展开
When the Mexican currency crisis began in late 1994, the Wall Street Journal reported that within a week the peso had lost almost 36 percent of its value against the dollar, and 43 percent since the beginning of the year. This highlights the significance of the impact of currency value fluctuations on international business negotiations. International firms that negotiated business deals or operations in Mexico should have taken the risk of the peso devaluation into account during their negotiations with Mexican firms.
International business transactions take place in a world of multiple currencies, the values (foreign exchange rates) of which fluctuate daily. A business deal that is not effectively structured to compensate and protect against foreign exchange fluctuations is likely to be a prelude to a disaster if the underlying currencies in which payments are to be received precipitously decline in value--or a windfall if they appreciate in value--against the recipient company's home currency or other stable currencies. It would be prudent for negotiators of both companies to obtain realistic "most likely" forecasts of the exchange rates for the relevant currencies from such reliable sources as international banks and currency futures markets. They can thus build into the agreement contingency clauses that would protect either side from wild swings in the exchange rates of their respective currencies or engage in currency hedging contracts.
Foreign exchange controls by many governments also influence international business negotiations. The ability of a company to pay for imported raw materials, or to repatriate profits or dividends to a foreign parent, depends on the willingness of the host government to make the necessary foreign exchange available for such transactions. Negotiators for a foreign company must ensure that, in whatever agreement is negotiated, provisions are made that would avoid or blunt the effect of these controls. For instance, in the face of foreign exchange restrictions, an international company could negotiate a "counter-trade" deal by which payment is made in goods, rather than cash.
Foreign Government Controls and Bureaucracy
The extent of governmental interference in business in many nations is extensive. Government agencies may have the authority to control the total output of an industry. Or they may have absolute control over the granting of permits to expand production capacity. A company with the potential to increase market share is obligated to obtain the necessary license to expand capacity, a license that is often denied by government bureaucrats. 展开
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货币的波动与外汇兑换
在1994年晚些时候墨西哥货币开始出现危机,华尔街日报报道说;墨西哥比索在一周之内对美元贬值36%,与年出相比贬43%,币值的波动对国际贸易的谈判造成了很大负面影响,进行贸易谈判的外国公司以及设在墨西哥的外国公司在与墨西哥的商家进行谈判时不得不考虑比索贬值的因素,国际贸易是在多币种,兑换率每日都在变的环境中进行的,如果交易不做认真权衡,使其在交易货币汇率波动时免受损失,在付款与收款方的本国货币或其他稳定货币的比值急剧下降时,这种交易就是一场灾难,或是比值陡升,发一笔横财,谈判双方应该慎重行事,提前从国际银行和货币未来走势预测市场的部门获得相关货币汇率的可靠的预测信息,因此,双方可以在协议中订立意外条款,在货币比率大幅波动时使对方免受损失,或约定保护合同,有些国家政府人为地控制外汇比率,这也对国际间贸易谈判的结果有一定的影响,一个公司对进口材料的付款能力以及给国外母公司的利润返还,都要看东道国政府对从这些贸易中获取外汇的愿望的程度, 外国公司的谈判人员必须确保合同条款中尽量避免或降低政府对这些控制的影响,例如外国公司可以协商以抵消贸易付款方式,以货抵款,而不是现金付款,
外国政府的控制与官僚作风
在很多国家政府的干预很广泛,政府部门有权控制工业的总产出,或者政府对扩大生产能力绝对控制,有潜能扩大市场份额的公司必须获得政府的许可执照,而政府官僚们又往往不给发放这种执照,
在1994年晚些时候墨西哥货币开始出现危机,华尔街日报报道说;墨西哥比索在一周之内对美元贬值36%,与年出相比贬43%,币值的波动对国际贸易的谈判造成了很大负面影响,进行贸易谈判的外国公司以及设在墨西哥的外国公司在与墨西哥的商家进行谈判时不得不考虑比索贬值的因素,国际贸易是在多币种,兑换率每日都在变的环境中进行的,如果交易不做认真权衡,使其在交易货币汇率波动时免受损失,在付款与收款方的本国货币或其他稳定货币的比值急剧下降时,这种交易就是一场灾难,或是比值陡升,发一笔横财,谈判双方应该慎重行事,提前从国际银行和货币未来走势预测市场的部门获得相关货币汇率的可靠的预测信息,因此,双方可以在协议中订立意外条款,在货币比率大幅波动时使对方免受损失,或约定保护合同,有些国家政府人为地控制外汇比率,这也对国际间贸易谈判的结果有一定的影响,一个公司对进口材料的付款能力以及给国外母公司的利润返还,都要看东道国政府对从这些贸易中获取外汇的愿望的程度, 外国公司的谈判人员必须确保合同条款中尽量避免或降低政府对这些控制的影响,例如外国公司可以协商以抵消贸易付款方式,以货抵款,而不是现金付款,
外国政府的控制与官僚作风
在很多国家政府的干预很广泛,政府部门有权控制工业的总产出,或者政府对扩大生产能力绝对控制,有潜能扩大市场份额的公司必须获得政府的许可执照,而政府官僚们又往往不给发放这种执照,
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