We explain the difference between import and export, the function of each one and its intervention in international trade.
What is the difference between import and export?
Import and export are two common concepts in the world of international trade, and they can be understood as the operation of acquiring and transporting goods from one country to another : These goods are imported when they are purchased abroad and distributed within the country, and they are exported when they are manufactured in the country and sold to foreign consumers.
Both operations make up international trade which is the tool that countries have to obtain the goods and services offered by other nations, and thus compensate for what is not available in their own territory. Furthermore, imports and exports constitute what is known as a nation's balance of trade: the balance (if any) between what is bought and what is sold abroad.
Imports are key so that countries can have access to materials and services that are scarce in their own territory and that on the other hand the selling country has plenty of them. However, this has a notable impact on local trade, given that imported products can compete in price and quality with national products.
Instead, Exporting is a way to deal with excess production of local supply thus obtaining extra money to allocate to savings, or local improvement.
The public or private initiatives that are dedicated to these operations are known, logically, as importers or exporters, and their purchases or sales are governed both by the local legislation of their countries, as well as by international trade agreements and statutes.
Normally, countries usually impose taxes on imported merchandise to collect revenue from the treasury and to increase their consumer value, thus protecting local producers in the same sector.
But when free trade agreements and other similar provisions are signed, a freer and easier flow of goods is allowed, without customs impediments or so many taxes, which directly affects import and export rates.
Finally, goods and services introduced into a country from abroad are called imported goods or imports, while goods and services offered abroad are called exported goods or exports.
References
- “Import” in Wikipedia.
- “Export” in Wikipedia.
- “Difference between import and export” at EAE Business School.
- “What does import and export mean?” at UTEL University Blog.
- “What is the difference between import and export?” (video) at the National Institute of Foreign Trade and Customs (Mexico).
