Difficulties faced by importers and exporters

• Different languages
• Language is a barrier in international trade because it leads to communication problems.
• There is a need to translate information or instructions from one language to another e.g. Chinese to English.
• Different currencies
• Different countries make use of different currencies which need to be converted to and fro using prevailing exchange rates.
• Different weights and measures:
• A lot of countries are yet to adopt the metric system for example the U.S which makes use of feet instead of metres.
• Different cultures and religions:
• Different people in the world believe in different religions and have different cultures.
• For example due to religion and cultural reasons Zimbabwe cannot export beef to India.
• Different laws and regulations:
• Each country has its own laws and regulations which govern the activities of their citizens as well as rade.
• For example Zimbabwe’s roads require motorists to travel on the left while Americans travel on the right. This means that some types of vehicles might not be allowed into Zimbabwe.
• Differences in technology resulting in entities in developing nations facing stiffer competition from developed nations which can produce goods more cheaply using advanced technology.
• Conducting market research, to establish the demand for goods in another country is expensive and difficult for the exporter to obtain such information on foreign markets.
• Exporters often experience delays in receiving their payment and there can also be risk of default by the importer due to wars or state interference.
• A lot of documents, which are sometimes difficult to understand need to be completed.
• Long distances are involved resulting in:
• higher transport costs.
• More transit risks.
• Higher insurance charges.
• Difficulty in providing after-sale services.
• The government may impose trade restrictions enforcing quotas in an effort to control foreign currency reserves as well as in pursuit of other macroeconomic goals.
• Political instability e.g. civil wars and disorder in a a country and political interference may restrict trade.
• There is stiff competitions.
• Packaging is expensive.

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