Passage 2
Nations with serious debt problems, such as Mexico, Brazil and Argentina, have been compelled to devote almost all their export earnings to debt service, leaving themselves with virtually no surplus to pay for imports. With barter, however, debtor nations can continue to import goods while, in effect, concealing export earnings from creditors. But counter trade is not the exclusive province of debtor nations. Says Yoffie， “Even countries with strong foreign exchange positions, such as Australia, Canada and Indonesia, are insisting on countertrade in certain areas. Linking imports and exports is a way to exert power over multinational corporations. Countries that lack expertise in international marketing try to use counter trade as leverage to tap the networks of 【global firms】.”
39.What are the advantage and disadvantage of barter?
The advantage is that the debtor nations can continue to import goods. The disadvantage is that they may conceal export eamings from creditors.
