This document defines and describes countertrade, which refers to international trade where payment is made in goods or services rather than money. It is used when countries lack hard currency or when traditional market trade is impossible. Countertrade involves two countries or companies that trade goods and services they each want. Types include barter, switch trading, counterpurchase, and buyback. Advantages are additional hard currency, technology gains, and conserving currency reserves, while disadvantages include handling unfamiliar goods. Various firms use countertrade and references are provided.

1. Andrés Felipe Barragán Rincón
COUNTERTRADE

2. WHAT IT IS?
 Countertrading refers to a category of international
trade in which an exporter agrees to accept
payment in the form of goods or services.
 One such method of trading between nations is
called counter trade. Counter trade is an import /
export relationship between nations or large
companies in which good and/or services are
exchanged for goods and services instead of
money.

3. AN ACADEMIC JOKE…

4. HOW IS IT USED?
 Countertrade also occurs when countries
lack sufficient hard currency, or when other
types of market trade are impossible.

5. INVOLVED PARTIES
 Both would need to have what the other
wants.
 OR two countries that enter into cooperation
contract agree to continuous purchases of
goods and services from each other.

6. TYPES OF THE MODE
 Barter
 Switch Trading
 Counter Pourchase
 Buyback
 Offset

7. ADVANTAGES
 Gives additional hard currency.
 Technology advances that the country would
not otherwise have.
 It helps conserve foreign currency reserves
of the importing country
 It allows the importing country to export
products for which markets might not
otherwise exist.

8. DISADVANTAGES
 The main disadvantage of countertrade is
that companies have the possibility of
handling goods that they are not familiar
with.

9. FIRMS USING COUNTERTRADE

10. REFERENCES
 Countertrade. (2013,March 17). In Wikipedia, The Free Encyclopedia. Retrieved 10:59, February 27,
2013, from http://en.wikipedia.org/wiki/Counter_trade
 Barter. (2013, March 17). In Wikipedia, The Free Encyclopedia. Retrieved 23:25, March 16, 2013
fromhttp://en.wikipedia.org/wiki/Barter
 [Web log message]. (2010, 03 11). Retrieved from
http://www.barternewsweekly.com/2010/03/11/what-is-counter-trade-1851
 American Countertrade Association. "Welcome to the ACA Web Site." Washington: American
Countertrade Association, 1999. Available from www.countertrade.org .
 Bost, Patricia J., and John A. Yeakel. "Are We Ignoring Countertrade?" Management Accounting,
December 1992, 43-47. http://www.referenceforbusiness.com/encyclopedia/Cos-
Des/Countertrading.html#ixzz2O1OWqmG3
 Counter trade. (N.A) (2011, 02 11). Retrieved from http://www.slideshare.net/abhijeetkadian/counter-
trade
 Counter trade. (N.A) (2013). Retrieved from http://www.investopedia.com/terms/c/countertrade.asp
http://www.investopedia.com/terms/c/countertrade.asp