СОДЕРЖАНИЕ
Предисловие …………………………………………………………………………………….7
Unit I.
Text I. FOREIGN ECONOMIC ACTIVITIES OF UKRAINE……………………………..8
Text II. WORLD TRADE ORGANIZATION …………………………………………….14
Text III. THE HISTORY OF THE WTO ………………………………………………….20
Text IV. THE WTO AGREEMRNTS ……………………………………………………..21
Unit II.
Text I. BUSINESS AND INVESTMENT OPPORTUNITIES IN UKRAINE …………....24
Text II. UKRAINE’S BUSINESS CLIMATE TODAY …………………………………..26
Text III. FOREIGN TRADE POLICY OF UKRAINE……………………........................28
Unit III.
Text I. BETWEEN MARKET ECONOMY AND DEMOCRACY ………........................30
Text II. THE RISE OF THE MARKET DICTATORSHIP ……………………………….31
Text III. THE CRASH OF WESTERN CIVILIZATION: THE LIMITS OF THE MARKET
AND DEMOCRACY ………………………………………………………………………33
Text IV. THE DEATH OF THE JOB ……………………………………………………..35
Unit IV.
Text I. A NEW ECONOMY FOR A NEW CENTURY.......................................................38
Text II. THE SHAPE OF A NEW WORLD ECONOMY ……………….………………..39
Text III. REDEFINING PROGRESS IN GLOBAL ECONOMY ………………………...41
Text IV. GLOBALIZATION OF WORLD ECONOMY ………………………………….42
Text V. INTERNATIONAL DIGITAL ECONOMY ……………………………………...44
Unit V.
Text I. INTERNATIONAL TRADE AND INTERNATIONAL BUSINESS……………..47
Text II. WORLD ECONOMY …………………………………………………………….51
Text III. THE HISTORY OF WORLD TRADE ………………………………………….53
Text IV. BALANCE OF TRADE …………………………………………………………56
Unit VI.
Text I. CAPITAL INVESTMENTS.....................................................................................58
Text II. THE IMF AND THE WORLD BANK …………………………….....................60
Text III. THE GOLD STANDARD ………………………………………………………62
Text IV. THE DOLLAR PURCHASING POWER ………………………………………63
Unit VII.
Text I. MONEY AND ITS FUNCTION..............................................................................65
Text II. INTERNATIONAL MONETARY SYSTEM ……………………………………67
Text III. BANKING ……………………………………………………………………….72
Text IV. RETAIL BANKING ON THE INTERNET……………………………………...74
Text V. LONDON’S ROLE AS A FINANCIAL CENTRE ……………………………….76
Text VI. CASE STUDY ……………………………………………………………………77
Unit VIII.
Text I. ACCOUNTING INFORMATION AND THE CAPITAL FLOWS.........................80
Text II. CREATING ECONOMIC SYSTEMS IN THE GLOBAL MARKETPLACE…..83
Text III. THE FALL OF BIG BUSINESS ………………………………………………..85
Text IV. LOWER SALES AND MARKETING COSTS ON THE INTERNET …………86
Text V. BUSINESS AND THE ENVIRONMENT: LESS IS MORE –
MANUFACTURERS ARE TRYING TO CUT THEIR USE OF PACKAGING
MATERIALS ………………………………………………………………………………87
Unit IX.
Text I. SUPPORT FOR ECONOMIC AND POLITICAL FREEDOM................................89
Text II. INTELLECTUAL PROPERTY HISTORICAL ROOTS OF THE PROBLEM…..90
Text III. THE PROTECTION OF INTELLECTUAL PROPERTY ………………………91
Text IV. PRODUCT SAFETY AND PRODUCT LIABILITY …………………………...92
Text V. CONTRCT LAW ………………………………………………………………….94
Unit X.
Text I. HISTORY OF THE EUROPEAN UNION ..............................................................98
Text II. THE EUROPEAN UNION AND ITS INSTITUTION …………………………101
Text III. EUROPEAN INITIATIVE FOR DEMOCRACY AND HUMAN RIGHTS ….103
Text IV. POLITICAL AND ECONOMIC RELATIONS ………………………………..104
Unit XI.
Text I. INTERNATIONAL INVOLVEMENT IN BUSINESS..........................................105
Text II. SIX WAYS OF ENTERING A FOREIGN MARKET ………………………….108
Text III. INTERNATIONAL LAW AND BUSINESS …………………………………..110
Unit XII.
Text I. TRANSPORTATION AS FACTOR OF ECONOMIC DEVELOPMENT………117
Text II. TRANSPORT AND ENVIRONMENT …………………………………………123
Text III. MODERN SYSTEM OF COMMUNICATION ………………………………..126
Text IV. THE US TRANSPORTATION ………………………………………………..129
Unit XIII.
Text I. TESTING THE MARKET-FINDING OUT...........................................................136
Text II. FACTORS TO BE CONSIDERED BEFORE DECIDING TO EXPORT ……...137
Text III. EXPORT AND IMPORT OPERATIONS ……………………………………..139
Text IV. EXPORT AS AN IMPORTANT PART OF FOREIGN TRADE ……………...143
Unit XIV.
Text I. OPENING UP EXPORT MARKETS ....................................................................148
Text II. THE CHOICE OF COUNTRIES FOR EXPORTING ………………………….151
Text III. PAYMENT FOR EXPORT SERVICES ……………………………………….153
Unit XV.
Text I. EXPORT AND METHODS OF PAYMENT …………………………………….156
Text II. PAYMENT IN ADVANCE ……………………………………………………..157
Text III. THE DOCUMENTARY LETTER OF CREDIT ………………………………158
Text IV. CONTRACT OF SALE ………………………………………………………...159
Text V. DOCUMENTARY COLLECTION ……………………………………………..161
Text VI. OPEN ACCOUNT ……………………………………………………………...162
Unit XVI.
Text I. EDUCATION AND ECONOMICS........................................................................164
Text II. EDUCATION AND EMPLOYMENT ………………………………………….165
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Text III. EDUCATION AS AN ECONOMIC ASSET ………………………………….167
Text IV. VOCATIONAL TRAINING IN AMERICA AND EUROPE …………………168
Unit XVII.
Text I. WHAT ARE THE KEYS TO SUCCESSFUL PROBLEM SOLVING?...............171
Text II. SITUATIONAL LEADERSHIP AS THE KEY TO EFFECTIVELY MANAGING
PEOPLE…………………………………………………………………………………..172
Text III. BUSINESS STRUCTURE, STAFF OF THE ENTERPRISE …………...........174
Text IV. APPLICATION FOR WORK, STUDY ……………………………………….178
Unit XVIII
Text I. WHAT IS IT RIGHT RESUME? ………………………………………………..184
Text II. BUSINESS LETTER, FAX MESSAGE ………………………………………..187
Text III. BUSINESS INTERVIEW ……………………………………………………...194
Unit XIX
Text I. LANGUAGE AND CULTURE IN BUSINESS RELATIONS ………………….196
Text II. BUSINESS ETIQUETTE IN UKRAINE ……………………………………….196
Text III. GOOD MANNERS. HOW NOT TO BEHAVE BADLY ABROAD (BY
NORMAN RAMSHAW) …………………………………………………………………198
Supplement .................................................................................................................................201
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UNIT I
Text I. FOREIGN ECONOMIC ACTIVITIES OF UKRAINE
Long-term forecast of development of foreign trade of any country are always
a top-priority issue both for domestic and foreign investors and businessmen. The
attractiveness of sectors of the economy that are highly profitable in the long run is
the subject. In this text we are talking about a crucial impetus in the development of
the economy of the country.
Numerous economic and political factors and their combined effect determine
the development of foreign trade of this or any other country.
Due to the forthcoming European integration of Ukraine the Ukrainian
government has elaborated four directions of foreign economic trade for the nearest
decades. Let’s review the potential in these directions.
1.
First of all – the issue of providing food for an ever growing
population. The “green revolution” and other effective measures have given hope of
relief from the lethal threat of hunger in the largest and the most “hungry” countries
in the past – Indian and China. But countries in Africa have taken their place. There
is no way to know which countries will take the place of the African countries once
those countries become sufficient food suppliers. However, while seemingly
pessimistic, it is not unlikely that other countries won’t then arrive and the places of
the African countries. Thus, those countries that have the ability to grow food
products such as grain and vegetables and to produce meat, milk and other
commodities will always be influential in the world market and in world politics.
Ukraine with the potential of its fertile land resources, favorable climate and with its
thousand – year traditions of husbandry will always be one of powerful exporters of
processed food products and unprocessed foodstuffs. Investments in industrial
agriculture should never devalue. Undoubtedly, a certain cycle can be observed and
of course is present in the agriculture of Ukraine, as well as in other countries that
export food products. Last year Ukraine’s grain harvest amounted to almost 40
million tons and more than 11 million tons of grains were exported. Ukraine is one of
the top five leading grain exporters in the world. But, for the year 2005, a year of
disastrous crop failures – only about to import almost two million of food grain
though at the same time Ukraine’s export of fodder grain increased. A similar
situation occurred in the year 2002 in Canada – one of the big exporters of grain. The
potential for harvesting huge crops in Ukraine is so large that foreign companies with
leading technologies are eager to invest in Ukrainian agriculture. Currently Ukraine is
just beginning to apply modern technologies in agriculture. So in the long run
Ukraine will always be an influential exporter of grain products in the world’s
markets. Even with tough competition Ukraine’s advantage will be the natural quality
of its unprocessed and processed agriculture products.
2.
Energy is the second area. The whole last century can be called “a
century of struggle” of the developed countries for energy resources. There is even
such a saying – “politics smells like oil”. The third millennium began under the same
“slogan”. At the same time scientists are optimistic about discovering soon a
4
technology that will provide full and even an unlimited supply of energy for the
needs of modern civilization. But first of all, there are grounds to doubt such
excessive optimism, and secondly, there will always be a need for machinery,
equipment for generation, transformation, distribution and consumption of energy.
Therefore, those countries that have a sufficient supply of raw resources or
production potential for the manufacturing of applicable equipment for the whole
energy supply “logistic chain”, so to say, will always be present with their products
in the world market. Ukraine will always be among such countries. Primary energy
resources are limited in Ukraine (except for renewable energy sources like wind,
solar, geothermal, hydro energy). However, the country has well-developed sectors of
energy machinery production, extraction and transportation of oil, natural gas, coal
(fossil fuel sources). Ukraine’s current reduction in the export of such machinery is a
consequence of the reduction in foreign trade since the breakup of the Soviet Union.
This situation is temporary. Ukraine will inevitably expand its presence in the world
market offering its products and new high technologies for many sectors of economy.
Ukraine’s share, which is insignificant now in the world trade market, will be
increasing. Confidence in such future development is based on the fact that Ukraine
possesses the necessary production and intellectual potential, and the overall demand
for such products will be increasing in the future.
3.
The third prospective direction in exporting Ukrainian goods and
services is in the production of equipment and in the development of
technologies for the protection of environment and humankind itself. There is no
other country in the world that spends so much on ecology (8% of the state budget)
as Ukraine does due to the necessity of protection for its population from the
consequences of the Chernobyl disaster. It can be confidently stated that within a
decade Ukraine will eventually become one of the leading countries in the field of
providing high technologies and products in the world market for solving
ecologyrelated issues. This will be one of Ukraine’s intellectual and production
potential of the formed military complex can be re-oriented and used for solving
ecology issues. As time goes by, investors who put their resources into this field of
Ukrainian science and economy will become “founders” of new spheres for the world
economy.
4.
Lastly, production of military products is the fourth direction for
Ukraine’s foreign trade. Such direction is significant now and will continue to be so
in the future. Today Ukraine is in the top ten leading countries in the field of
production of military equipment and technologies. During the first years of
independence Ukraine was selling its military surplus that had accumulated during
the years of Cold War. Such activity of the young independent state didn’t really
bother its competitors that reasonably believed that the country would soon run out of
stock of military products. But already in the past years new military products
constituted three fourth of Ukraine’s total military production. The well-known radar
system “Kolchuga” was among such products. In the past years Ukraine has become
more noticeable in the world market in the specific field of military products. After
September, a new threat to the world appeared – terrorism. That also causes the
5
demand for specific sophisticated military equipment to increase. Therefore, this
direction in foreign trade for Ukraine was, is and will be one of its priorities.
Ukrainian military potential can even increase if the country decides to cooperate in
this field with Russia and several other countries of the European Atlantic
community. Such intentions have already been declared and even some agreements
on joint efforts in this field have appeared. But Ukraine doesn’t take part in the
annual exhibition of the means for fighting against terrorism. This is the core
evidence for the country’s progress in the sphere of military production. The reason
for this is that it became a “custom” in Ukraine to evaluate the competitive level of its
products by considering what “artificial” obstacles are created for their promotion of
foreign markets.
Vocabulary notes
Business process re-engineering is when a business tries to improve its performance in every area
by completely redesigning systems and processes rather than just by changing existing ones.
Management by walking about (MBWA) is the idea that managers can manage in the best way
visiting places where operations are carried out and by talking to employees.
Empowerment is when workers in a company are given more responsibility by being allowed to
organize their own work and make decisions without asking their managers.
A portfolio worker is a professional person who works for many different companies or
individuals.
Total quality management is the management of systems in a company to make sure that each
department is working in the most effective way to improve the quality of goods produced or
services provided.
to elaborate a direction – разработать
supply of raw resources – поставка сырья
направление
fossil fuel sources – топливные ископаемые
to provide foodstuffs – обеспечить
development of high-technologies –
продовольственными продуктами
разработка высоких технологий
fertile land resources – плодородные
military surplus – излишек военного
земляные ресурсы
оборудования
husbandry – сельское хозяйство
artificial
obstacles
–
искуственно
созданные преграды
export of processed food products –
экспорт обработанных продовольственных
to
forecast
the
freight
flow
–
продуктов
прогнозировать поток груза
to harvest huge crops – собирать большой
to implement a system – применять
урожай
систему
distribution and consumption of energy –
распределение и потребление энергии
1.
2.
3.
4.
5.
Comprehension and Discussion Questions
Which idea is all about getting products and services right first time, rather
than checking them for errors when they’re finished?
Which idea tells companies to take a blank piece of paper and imagine that
they’re starting their business all over again?
Which idea makes managers less powerful?
Which idea tells managers to get out of their offices?
Which idea describes people who are independent and run their own careers?
6
6. Do you think that the terms are useful in understanding modern business?
Explain.
7. Why do you think that jargon is so common in business and other technical
fields?
8. What directions did the Ukrainian governments elaborate for the nearest
decades?
9. Why is Ukraine one of powerful exporters of processed and unprocessed
foodstuffs?
10.What place does Ukraine occupy among exporters of grain in the world?
11.What is the main slogan of the third millennium?
12.What are energy resources of Ukraine?
13.What is the role of Ukraine in the production of equipment and in the
development of technologies for the protection of environment and humankind
itself?
14.How much does Ukraine spend on ecology from the state budget?
15.Why is the production of military products significant for the Ukrainian
foreign trade?
16.What countries is Ukraine going to cooperate with in the field of military
products trade?
17.What are the artificial obstacles to Ukraine’s entry into the world markets?
Ex. 1. Match the Russian terms with their English equivalents.
1. обеспечить продовольственными
продуктами
2. экспорт обработанных
продовольственных продуктов
3. контролировать транзитные
перевозки
4. применять систему
5. разработка высоких технологий
6. поток груза
7. потребление энергии
8. поставка сырья
a) implementation of a system
b) development of high-technologies
c) consumption of energy
d) to provide foodstuffs
e) export of processed food products
f) to monitor transit cargo
g) flow of freight
h) supply of raw resources
Ex. 2. Translate the sentences into English using the key terms given in Ex. 1.
1. Для улучшения обстановки, которое связано с экспортом и импортом и
интеграцией Украины в Европу, нужно улучшить механизм
внешнеэкономической деятельности.
2. Для европейской интеграции Украине нужно применить наиболее
эффективные формы сотрудничества с зарубежными странами за счёт
улучшения мобильности товаров и услуг, капитала и рабочей силы.
7
3. В мире всегда существует потребность в разработке высоких технологий
оборудования для генерации, трансформации, распределения и
потребления энергии.
4. Украина имеет перспективы развития интеллектуального потенциала,
энергетических ресурсов, высоких технологий для многих секторов
экономики страны.
5. Значительная часть интеллектуального и производственного потенциала
прошлого военного комплекса может быть переориентирована и
использована для разрешения экологических проблем.
6. Украина является страной, которая контролирует транзитные перевозки,
потоки грузов, которые поступают из России и стран Западной Европы.
7. В связи с угрозой мирового терроризма повышается потребность в
разработке и выпуске современного военного оборудования.
8. Для Украины существуют искусственно созданные преграды, которые
препятствуют экспорту украинских товаров (металлов, химических
продуктов, сахара, самолётов и оружия) на мировой рынок.
9. Планируется применять систему для прогнозирования потоков груза,
которая будет контролировать транзитные перевозки, импорт, и экспорт
товаров и услуг всеми транспортными средствами.
Grammar
Function of the Gerund and the Present Participle (Participle I)
Function
Gerund
Participle I
1. subject
Selling depends on offering price.
Продажа (товара) зависит от
___________
предложенной цены.
2. a part of a A manager’s is signing an
compound
verbal agreement. Цель менеджера –
____________
predicate
подписать договор.
3. a part of a simple
A manager is signing an
predicate
______________
agreement.
Менеджер
подписывает договор.
4. an object
We spoke of reading new
instruction. Мы разговаривали о
___________
чтении новых инструкций.
5. an attribute
It was a new method of reading The Lady reading the
documents. Это был новый метод document is our new
изучения документов.
manager.
Женщина,
которая
читает
этот
документ, - наш новый
менеджер
6.
an
adverbial Before signing the document talk Signing the document pay
modifier
to a partner. Перед тем как attention to the date of its
подписать документ, поговори с term.
Когда
вы
партнёром.
подписываете документ,
обращайте внимание на
8
дату
срока
выполнения.
его
Ex. 3. Find ing-forms in the text defining Gerund or Participle I. Prove your
choice.
Ex. 4. Translate the sentences into Russian and state the underlined grammar
forms.
- An important area in protecting the domestic market is the regulation of issue
related to transactions in foreign economic relations.
- Significant changes have taken place with regard to improving the business
environment, covering all the sensitive areas of foreign-economic relations.
- The Ministry of Economy and European integration is coordinating Ukraine’s
economic and Social collaboration with the European Union.
- The Ministry is entrusted with providing organizational support for activities of
the Ukrainian part of the Committee on the Issues of Collaboration between
Ukraine and EU (Secretariat).
- Secretariat assures organization of implementing the Agreement on Partnership
and Collaboration between Ukraine and EU.
- A mechanism has been introduced for preparing annual action plans for
implementing the priority provisions of the Program and work plans on adapting
the Ukrainian legislation to that of the EU.
Ex. 5. Translate the following sentences into English using either Gerund or
Participle I.
1. Благоприятные условия для сбережения иностранного капитала
обеспечивается прозрачным механизмом ведения совершенных
правовых и регуляторных статусов.
2. Украина создала ясную и прозрачную систему управления, которая
формализует процесс поступления инвестиций.
3. Повышенный
уровень
торговли
с
зарубежными
странами
свидетельствует об улучшении состояния экономики в Украине в целом.
4. Получение валюты и материальных ценностей, которые поступают от
экспортных и импортных операций, являются индикатором
эффективности внешнеэкономической деятельности в Украине.
5. Министерством было проведено несколько раундов переговоров,
которые касаются обеспечения технической помощи со стороны
американского департамента торговли согласно с антидемпинговым
законодательством США.
6. Национальный банк Украины ввёл мероприятия, которые стимулируют
экспортные и импортные операции страны.
7. Были совершены шаги, которые защищают интересы национальных
предпринимателей в случае антидемпинговых и специальных
расследований.
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8.
Министерство экономики и европейской интеграции Украины
приостановило расследование против экспорта некоторых видов
металлических изделий в Венгрию, сырья в Мексику.
Ex. 6. Translate the sentences into Russian paing attention to the usage of
Gerund and Participl I constructions.
1. Considering the complexity of the problem, the decision was reached at a
rather early date.
2. The scholars are interested in seeing the post-war experience with trade
liberalization confirmed.
3. Suddenly imposing capital controls, the governments tried to avoid a
financial crisis.
4. Yesterday at Hyde Park we saw reasonable people questioning the prudence
of liberal policies toward international capital flows for all countries in all
circumstances.
5. The President said in a message accompanying the document that it would
stop runaway inflation and revitalize the economy if given a chance; he asked
Congress to join him in a quest to move America back toward economic
sanity.
6. Being the most powerful of all industrial countries, the United States pushed
inevitably ahead for world mastery with every available means at its
command.
7. Proponents of European integration are heard taking into account viewpoints
of the opposition.
Text II. WORLD TRADE ORGANIZATION
The WTO has two main purposes: to make rules for world trade and to settle
trade disputes between nations. In early 2000 the WTO had 135 member nations,
ranging from industrial nations such as the United States, Germany, and Japan to
developing nations in Africa, Asia, and Latin American. The WTO is currently
considering membership applications from many other nations.
Based in Geneva, Switzerland, the WTO obtains its authority from member
nations, which look to the organization as a vehicle to expand world trade. Like the
United Nations (UN), the WTO is essentially a club of nations, created and
empowered by its members and relying on them to comply with its rules and rulings.
The WTO’s powers are most frequently exercised when it serves as a court to
resolve trade disputes among nations. These judicial powers may have dramatic
consequences: WTO decisions can declare the laws and regulations of sovereign
nations illegal because they violate global trade rules.
The trade rules administered by the WTO are established after lengthy and
often tense negotiations involving many nations. Among the rules member nations
have agreed to follow is that they will not place quotas on imported goods or give
domestically produced goods preference over foreign goods. The WTO permits a
handful of exceptions to these rules.
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WTO regulations spell out the circumstances under which the organization can
settle disputes. When one member country believes that another has violated trade
rules, the two countries must first seek a settlement through formal consultations. If
consultations fail, the aggrieved nation can ask the WTO to convene a judicial panel
and issue a ruling. WTO dispute-resolution panels are composed of three experts,
usually trade lawyers, from neutral member countries. The WTO also has appellate
panels that rule on final appeals. Under WTO rules, a final judgment in a trade
dispute must be issued within 16 months.
A nation found to have violated trade rules has several choices. It can change
the regulation or practice that the panel found improper, or it can pay compensation
to the country that field the complaint. The offending nation can also refuse to accept
either or these choices, but then the aggrieved country has the right to impose
punitive tariffs (taxes) on goods imported from that nation.
The most prominent trade dispute handled by the WTO during the first five
years of its existence involved a complaint brought by the United States against the
European Union (EU), made up of 15 countries. The United States accused the EU of
violating international trade rules by prohibiting the importation of beef treated with
hormones. A WTO trade panel ruled in 1997 that the EU had run afoul of world trade
rules because the EU could not prove its claim that hormone – treated beef was
unsafe for human consumption.
The WTO requires nations to show that important restriction aimed at
protecting human health or the environment are based on science. This rule is
designed to prevent countries from arbitrarily discriminating against goods from
other countries. Despite the WTO ruling, the Europeans refused to lift the ban on
hormone-treated beef or to pay compensation. As a result, the WTO allowed the
United States to levy penalty tariffs totaling $116.8 million annually on Dijon
mustard, Roquefort cheese, truffles, and other imported European goods. The amount
of the tariffs was based on the estimated cost of lost U.S. beef export.
Vocabulary notes
to settle trade disputes – согласовывать
торговые споры
to expand world trade – расширять
всемирную торговлю
to empower – облекать властью
to comply with – быть в согласии с чемлибо
to violate – нарушать
lengthy
and tense
negotiations
–
долгосрочные и напряжённые переговоры
to place quotas – устанавливать квоту
preference – преимущество
a handful of exceptions – ряд исключений
to seek a settlement – находить решения
the aggrieved nation – потерпевшая нация
judicial panel – судейская комиссия
appellate panel – апелляционная комиссия
a complaint – жалоба
to impose punitive tariffs – наложить
штрафные санкции
to handle – вручить, подать на
рассмотрение
to prohibit – запрещать
to levy – взымать налоги
ad hoc (Latin) – создан для данного случая
ban – запрет
to set rules – устанавливать правила
to promote – содействовать
signatories – стороны, что подписались
binding – обязательный
to adopt – принимать
to submit – представить на рассмотрение
to approve – утверждать
scope – размах
11
1.
2.
3.
4.
5.
6.
7.
8.
9.
Comprehension and Discussion Questions
What is WTO?
What are the main purposes of the WTO?
Where is the WTO based?
What is the structure of the WTO?
How are trade disputes resolved?
How are the trade rules established?
When can the WTO convene a judicial panel?
What rule is designed to prevent countries from arbitrarily discriminating
against goods from other countries?
What did USA accuse the EU of?
REАDING AND SPEAKING
Discuss statements of some people on trade and business. Give your own vision of
the statements:
a) – “Free trade one of the greatest Blessing which a government can confer on a
people, is in almost every country unpopular.
Lord Macanly (an economist, 18th cent.)
b) – “The majority of businessmen are incapable of original thought because they
are unable to escape from the tyranny of reason.”
David Ogilvy (a businessman, 20th cent.)
c) – “To manage is to forecast and to plan, to organize, to command to coordinate
and to control.”
Henry Tayol (a manager, 20th cent.)
Do you know when the World Trade Organization came into existence? Try to
choose the right answer:
in 1945
in 1940
in 1957
Try to remember the meaning of the following abbreviations. They will be used in
the text below.
GATT – General Agreement on Tariffs ГАТТ – Генеральное соглашение по
and Trade
тарифам и торговле
WTO – World Trade Organization
ВТО
–
Всемирная
торговая
организация
GATS - General Agreement on Trade in ГАТС – Генеральное соглашение по
Services
торговле услугами
TBT – Agreement on Technical Barriers ТБТ – Соглашение по техническим
to Trade
ограничениям по торговле
ITO – International Trade Organization
ITO – Международная организация
торговли
TRIPS – Trade-Related Aspects of ТРИПС – Торговые аспекты прав
Intellectual Property Rights
интеллектуальной собственности
NAFTA – North American Free Trade НАФТА – Соглашение о свободной
12
Agreement
торговле
региона
Североамериканского
Ex. 1. Read the following information on GATT and WTO and make your own
conclusions. Do you think that the WTO is a simple extension of GATT or is it
much more?
GATT
WTO
- was ad hoc and provisional. The - its agreements are permanent. As an
General Agreement was never ratified
international organization it has a
in members’ parliaments, and it
sound legal basis because members
contained no provisions for the
have ratified the WTO agreements,
creation of an organization.
and the agreements themselves
- had “contracting parties”
describe how the WTO is to function.
- dealt with trade in goods
- has members
- its rulings could be blocked
- covers services and intellectual
property as well
- its rulings cannot be blocked
Ex. 2. Read the following statement from a “World Summit on Sustainable
Development” in Johannesburg, 2002. Imagine you were a participant of the
meeting. Now you are discussing the problem of globalization at the conference
held in Ukraine. What do you think we must do to prevent these tendencies and
develop the principles of stable development?
Quotation
“As a worldwide movement, there is probably no turning back from
globalization, which proves more and more powerful every year. Obviously, there are
positive and negative sides of this growth. On one hand, the integration of the world
community encourages developing countries to gain access to the world’s markets
and technologies. Globalization’s nay-sayers insist that the rich countries will become
more prosperous and the poor countries will stay poor.
Another general feature of globalization, economic development, sometimes
comes at a cost to the environment.”
Ex. 3. Discuss the problem of globalization using the following expressions.
- O.K. Let’s get down to business.
- Так. Давайте возьмёмся за дело.
- I’m not sure that’s relevant.
- Я не уверен, что это касается дела.
- Let’s leave that aside for the moment.
- Давайте оставим этот вопрос на
некоторое время.
- Hold on, we need to look at this in more - Подождите, мы должны рассмотреть
detail.
это более детально.
- Let’s go over, what we’ve agreed.
- Давайте посмотрим, к какому
соглашению мы пришли.
- I think we’ve covered everything. To - Я думаю, что мы рассмотрели все
sum up then.
вопросы. Подобьём итог.
13
Brainstorming
Divide into two groups. Take a sheet of paper and from the given
statements choose 10 benefits (I-st group) and 10 misunderstandings (II-nd
group) about the WTO. Time limit is 10 minutes. Appoint a spokesperson from
each group who’ll present your decisions.
- The system helps promote peace
- The WTO is for free trade at any cost
- The WTO dictates policy
- Disputes are handled constructively
- Commercial interests take priority over development…
… and over environment safety
… and over health and safety
- Rules make life easier for all
- Free trade cuts the costs of living
- It provides more choice of products and qualities
- Trade raises incomes
- The WTO destroys job, worsens poverty
- Small countries are powerless in the WTO
- Trade stimulates economic growth
- The basic principles make life more efficient
- The WTO is the tool of powerful lobbies
- Weaker countries are forced to join the WTO
- The WTO is undemocratic
- Governments are shielded from lobbying
- The system encourages good government
Ex. 4. Match the Russian terms with their English equivalents.
A
B
1. начальный капитал
a) to become a fully fledged member
2. внедрить в производство
b) the European Court of Human Rights
3. валовый национальный продукт
c) to combat corruption
4. высокотехнологическая продукция
d) a self-sufficient market economy
5. на душу населения
e) not to answer the criteria to attract
investments
6. стать полноправным членом
f) gross domestic product (GDP)
7. Европейский суд по защите прав и g) to carry out
свободы человека
8. бороться с коррупцией
h) the “seed” capital
9. самостоятельно функционирующая i) modern products
рыночная экономика
10. не соответствовать критериям для j) per capita
прилива инвестиций
14
Ex. 5. Translate the sentences into English using the key-terms given in Ex. 4.
1. Всемирная торговая организация считает Украину страной с рыночной
экономикой, чей инвестиционный климат ниже за критерии, достаточные
для прилива инвестиций.
2. Создание свободной от вмешательства страны, самостоятельно
функционирующей рыночной экономики, - лучший способ для борьбы с
коррупцией.
3. Эта страна прикладывает усилия, чтобы стать полноправным членом
Европейского сообщества.
4. Уже ратифицированы несколько международных и Европейских
конвенций, которые позволяют защищать свои права в Европейском суде
по защите прав и свобод человека в Страсбурге.
5. Украинские предприниматели без начального капитала могут ворваться
на рынок передового оборудования и выпускать высокотехнологическую
продукцию.
6. У нас есть несколько разработок, которые мы сами не можем внедрить в
производство, но партнёры за границей заинтересованы в их реализации,
что можно сделать общими усилиями.
7. Развитые страны владеют 97% мирового количества патентов, и всего в
33 странах валовый национальный продукт на душу населения ежегодно
возрастает на 3%.
Grammar
Infinitive
Indefinite
Continuous
Perfect
Perfect Continuous
The forms of the Infinitive
Active
to write
to be writing
to have written
to have been writing
Passive
to be written
to have been written
-
Ex. 6. Translate the following quotations into Ukrainian and state the form of
the Infinitive.
1. Better to remain silent and to be thought a fool, than to speak out and remove
all doubt. (A. Lincoln)
2. It is easy to be brave from a safe distance. (Aesop)
3. It is a sweet and glorious thing to die for one’s country. (Horace)
4. To think is to see (H. de Balzac)
5. Some books are to be tasted, others to be swallowed and some few to be
chewed and digested, that is some books are to be read only in parts others to
be read but not curiously, and some few to be read wholly, and with diligence
and attention. (F. Bacon)
6. To ask advice is in nine cases out of ten to tout for flattery. (J. Collins)
7. When you have nothing to say, say nothing. (Ch. Cotton)
8. To see what is right and not to do it, is want of courage. (Confucius)
15
9. All we ask is to be let alone. (D. Jefferson)
10.To tax and to please, no more than to love and to be wise, is not given to men.
(E. Burke)
11.It is better to be faithful than famous. (Th. Roosevelt)
12.Necessity knows no law except to conquer. (P. Syrus)
13. To do two things at once is to do neither. (P. Syrus)
14.It is better to understand a little than to misunderstand a lot. (A. Trance)
Ex. 7. Translate the following sentences into English paying attention to the
form of the Infinitive.
1. Вопрос, который будет обсуждаться на конференции, очень важен.
2. Страна, которая нарушила права торговли, должна отвечать за это.
3. Они были очень довольны, что уладили торговые разногласия.
4. Страна, которая потерпела, имеет право наложить штрафные санкции на
товары, что доставляются из другой страны.
5. Всемирная торговая организация создаёт правила ведения торговли и
улаживает торговые споры между странами.
6. Товары, которые будут производиться на этом предприятии, отвечают
мировым стандартам.
7. Члены делегации были довольны тем, что были ознакомлены с работой
нашего предприятия.
8. Мы надеялись, что обе стороны примут условия договора вовремя.
Text III. THE HISTORY OF THE WTO
Although the WTO is a relatively new international institution, its creation is
firmly tied to the past. The push to create a world trade body gathered force in
aftermath of the many restrictive trade rules adopted worldwide during the Great
Depression. After the Depression began in 1929, many nations placed large tariffs on
imports to protect domestic industries and jobs. Most economists now agree that
these tariffs aggravated the economic downturn by crippling trade and hurting
companies that depended on overseas markets.
After World War II (1939-1945) Western diplomats and economists pushed to
establish an international organization that would promote freer trade. The United
States proposed setting up a body called the International Trade Organization (ITO),
which would have extensive powers to enforce world trade rules. This organization
was to complement two other institutions established shortly after the war to bolster
the world economy: the International Monetary Fund (IMF) and the World Bank. The
IMF’s purpose was to help stabilize the currencies and economies of many nations,
and the World Bank was empowered to make large, low-interest loans to nations to
spur their economic growth.
The ITO never got off the ground, however. The primary reason was the failure
by U.S. president Harry Truman to persuade the Congress of the United States to
approve the organization. Many members of Congress were concerned that the ITO
would have the power to declare U.S. trade regulations illegal. Without the
16
participation of the United States the world’s largest importer and exporter the
organization collapsed.
In 1947, with the fate of the ITO still unclear, diplomats agreed to set up a far
less powerful body called the General Agreement on Tariffs and Trade (GATT). That
Geneva-based organization had two roles: to oversee negotiations, to reduce tariffs
and other trade barriers and to adjudicate trade disputes. GATT proved highly
successful in lowering tariffs. During eight rounds of trade talks, the last of which
ended in 1994, tariffs in the industrial world fell from more than 40 percent of the
value of all industrial goods traded internationally to less than 4 percent.
However, GATT was less successful in settling trade disputes because of its
limited enforcement powers. To resolve disagreements, it relied largely on achieving
a consensus, but a consensus often did not develop. In addition, GATT’s disputeresolution procedures were slow, sometimes taking three years or more. Many
nations became frustrated with GATT’s inability to remove numerous long-standing
trade barriers or halt the creation of new ones.
In decades past, trade barriers erected by one country often triggered retaliatory
measures from other countries. These actions sometimes led to spiraling rounds of
increasing tariffs and other barriers that cut deeply into international trade. Eager to
prevent such trade wars, many nations that were dissatisfied with GATT backed the
creation of a powerful new organization to quickly settle trade disputes with as little
ill feeling as possible. At a 1994 conference in Marrakesh, Morocco, representatives
from 109 nations agreed to replace GATT with the WTO, in the hope that the new
trade body would be more powerful and effective than its predecessor. The WTO
began operating on January 1, 1995.
Vocabulary notes
crippling trade – убыточная торговля
to bolster – поддерживать
to be empowered – быть наделённым
властью, полномочиями
to spur – дать толчок
to adjudicate – принимать решение на
правовых основах
to become frustrated – разочаровываться (в
данном случае)
to trigger – дать начало, стимулировать
retaliatory measures – мероприятия,
применяемые в ответ
predecessor - предшественник
Text IV. THE WTO AGREEMRNTS
How can you ensure that trade is as fair as possible, and as free as is practical?
By negotiating rules and abiding by them.
The WTO’s rules – the agreements – are the result of negotiations between the
members. The current set were the outcome of the 1986-94 Uruguay Round
negotiations which included a major revision of the original General Agreement on
Tariffs and Trade (GATT).
GATT is now the WTO’s principal rule-book for trade in goods. The Uruguay
Round also created new rules for dealing with trade in services, relevant aspects of
intellectual property, dispute settlement, and trade policy reviews. The complete set
runs to some 30,000 pages consisting of About 30 agreements and separate
17
commitments (called schedules) made by individual members in specific areas such
as lower customs duty rates and services market – opening.
Through these agreements, WTO members operate a non-discriminatory
trading system that spells out their obligations. Each country receives guarantees that
its export will be treated fairly and consistently in other countries’ markets. Each
promises to do the same for imports into its own market. The system also gives
developing countries some flexibility in implementing their commitments.
Goods.
It all began with trade in goods. From 1947 to 1994, GATT was the forum for
negotiating lower customs duty rates and other trade barriers; the text of the General
Agreements spelt out important rules, particularly non-discrimination.
Since 1995, the updated GATT has become the WTO’s umbrella agreements
for trade in goods. It has annexes dealing with specific sectors such as agriculture and
textiles, and with specific issues such as state trading, product standards, subsidies
and actions taken against dumping.
Services.
Banks, insurance firms, telecommunications companies, tour operators, hotel
chains and transport companies looking to do business abroad can now enjoy the
same principles of freer and fairer trade that originally only applied to trade in goods.
These principles appear in the new General Agreements on Trade in Services
(CATT’S). WTO members have also made individual commitments under GATT’S
stating which of their services sectors are willing to open to foreign competition, and
how open those markets are.
Intellectual property.
The WTO’s intellectual property agreement amounts to rules for trade and
investment in ideas and creativity. The rules state how copyrights, patents,
trademarks, geographical names used to identify products, industrial designs,
integrated circuit layout-designs and undisclosed information such as trade secrets –
“intellectual property” – should be protected when trade is involved.
Dispute settlement.
The WTO’s procedure for resolving trade quarrels under the Dispute
Settlement Understanding is vital for enforcing the rules and therefore for ensuring
that trade flows smoothly. Countries bring dispute to the WTO if they think their
rights under the agreements are being infringed. Judgements by specially – appointed
independent experts are based on interpretations of the agreements and individual
countries’ commitments.
The system encourages countries to settle their differences through
consultation. Failing that, they can follow a carefully mapped out, stage-by-stage
procedure that includes the possibility of a ruling by a panel of experts, and the
chance to appeal the ruling on legal grounds. Confidence in the system is born out by
the number of cases brought to the WTO-almost 250 cases in seven years compared
to some 300 disputes dealt with during the entire life of GATT (194u-1994).
Policy review.
The Trade Policy Review Mechanism’s purpose is to improve transparency, to
create a greater understanding of the policies that countries are adopting, and to
18
assess their impact. Many members also see the review as constructive feedback on
their policies.
All WTO members must undergo periodic scrutiny, each review containing
reports by the country concerned and the WTO Secretariat.
Vocabulary notes
to abide – придерживаться (правил)
commitment – обязательства
to infringe – нарушать (права)
to undergo scrutiny – подлежать
отчётности
dumping – демпинг
to map out – прикинуть
layout-designs – проектные замыслы
CASE STUDY
Ukraine and the WTO
Background Information
The WTO began operating on January 1, 1995. It is the only global
International organization dealing with the rules of trade between nations. The main
goal of the WTO is to help producers of goods and services, exporters and importers
conduct their business.
Problem
Ukraine first knocked on the door of the WTO in July 1994 and is waiting in
line with other countries for membership. The WTO officials said “It’s a long process
because Ukraine has to incorporate all WTO regulations into its domestic legislation
and convince all the members that all its laws in the field of agriculture, products,
services and intellectual property are compliant”. Ukraine joined in the WTO in
2009.
Brainstorming Session: Discus the Topical Questions
1. Is joining the WTO a first step toward Ukraine’s longer-teem goal of becoming
member of the EU? Why?
2. Is access to Ukraine’s market stable and predictable for foreigners? Give your
reasons.
3. Does Ukraine have a system for making and implementing arbitration
decisions on claims of foreign investors?
4. What can you say about the privatization process in agriculture?
5. Are foreigners allowed to own land in Ukraine?
6. What products are exported from Ukraine?
7. Do the goods produced in Ukraine meet the requirements of the European
standards? Give the example?
8. Can you give the examples of business success stories in Ukraine? (Coca-cola
for example)
19
UNIT II
Text I. BUSINESS AND INVESTMENT OPPORTUNITIES IN UKRAINE
Ukraine is a country comparable in geographical size and population to Italy
and France. The country possesses numerous competitive strengths, namely a
strategic geographical position and mild climate, rich natural resources, sizeable
consumer market, highly educated labour force, well developed transport
infrastructure, significant achievements in natural sciences and military-related
research, and a sophisticated research in all spheres of industry and technology.
However, the Ukrainian economy is currently in a critical position. This is due
to the fact that the economy of Ukraine was previously quite isolated, not oriented
towards satisfying the national interest of the country. The pricing policy was
basically inappropriate because the prices for raw materials and fuel supply were very
low and were not stimulating their rational use and the introduction of high
technology to industry.
Ukrainian efforts to be integrated to the world market were, over the first three
years, very reticent and did not realize the national potential.
Prior to independence, inter-republic trade accounted for more than 80 percent
of total “exports” and “imports”; as well as being tightly integrated with the
economy. Ukraine accounted for a major share about 25 percent of the Net Material
Product (NMP) of the former Soviet Union. Needless to say, at independence the
severance of the inter-republic links had a particularly disruptive effect on Ukrainian
enterprises and on the national economy as a whole. The foreign trade linkages of
Ukraine will no doubt play a key role in the recovery of the Ukrainian economy in
this transition period.
Upon gaining independence in 1991, Ukraine has become an equal member of
the international community. There is little doubt that the economic, scientific and
human potential of Ukraine is one of the most promising in Europe and offers many
business and investment opportunities. Attraction of new investments in the
Ukrainian economy, including foreign investments, is one of the effective ways of
overcoming this situation.
Relations associated with foreign investments in Ukraine are regulated by a
number of Ukrainian laws, Decree of the Cabinet of Ministers, and other legal Acts
of the State. Adoption of these Decrees by the Supreme Rada forms legal basis for
activities of foreign investors on the territory of Ukraine and proves protection of
their interests, gives the amount of authority no less than that of state enterprises. It
must contribute to the primary investment in the priority industries and territories.
Vocabulary notes
sizeable – широкий
to gain – добывать, доставать, получать
recovery – восстановление
reticent – сдержанный, недостаточный
inappropriate – несоответствующий
disruptive – разрушительный
comparable – сравнительный
sophisticated – сложный
inappropriate - несоответствующий
reticent – скрытый
severance – разрыв
disruptive - разрушительный
20
CASE STUDY
Background information
For the first time in its history Ukraine entered the list of the world’s six largest
grain exporters in 2002. The agreements for 11 mln t of grain have been lately
concluded at commodity exchanges. Many experts believe that gathering and selling
the present harvest should be conducted under the condition of deposits for grain
purchase, the formation of a grain exchange market. Some countries have agreed to
invest on special conditions.
Problem
Egypt plans to purchase a lot of Ukrainian winter crop. The Ministry of
Agriculture of Ukraine has organized a meeting of managers of an Egyptian import
company and the Ukrainian Association of grain producers to brainstorm the ideas of
selling wheat.
Task
You are members of the Ukrainian Association of grain producers. Work in groups of
3 or 4 persons and brainstorm the points listed in the rough notes. Then meet as one
group and select best suggestion for further study.
Brainstorming Session
1. What sort of wheat will be preferable?
2. Will the Buyer deposit in grain purchase? How?
3. What is the world market price for wheat?
4. What is the purchase price?
5. What does the Seller guarantee?
6. When will the sides renegotiate the price?
7. Why shouldn’t the price be fixed?
8. What terms must the goods be released on?
9. How much of the total volume of the contract can be exchanged for buying
Egyptian commodities?
10.How much is the Buyer planning to invest in future harvest?
11.When is a long-terms contract possible?
12.What discount can be given and when?
Read the letter from Ms. Carter, a business club secretary.
15 March 2010
Senator Brown
American Trade Center
Dear senator Brown,
I am the secretary of the Business Club in our town. We would like to invite you to give a talk at
our next meeting on 11 May. About sixty company directors are expected to attend it.
We would be grateful if you could inform us whether you will be able to take part in it and
which area of business you would prefer to talk about.
Yours sincerely,
Ms Jane Carter
club Secretary
21
Write a reply to Ms Simon:
- Thanking her for the invitation
- Agreeing to give the talk
- Saying what you will speak about
- Asking when and where the meeting will be held.
Text II. UKRAINE’S BUSINESS CLIMATE TODAY
In the short time since Ukraine has become a sovereign state, much has been
achieved in developing its economic legislation. Whilst this legislative evolution is
yet to be completed, there already exists a comprehensive range of laws and acts
which provide a solid legal foundation for emerging business and investment activity
in the country. A fundamental principle of this legislation is the concept of national
treatment, which means that any foreign company operating in Ukraine, regardless of
its ownership, is now treated on an equal basis with local companies.
Existing legislation now guarantees a high level of stability for the Ukrainian
business environment offering real incentives and opportunities to investors.
The Ukrainian foreign exchange system is regulated by a decree of the Cabinet
of Ministers “On the System of Foreign Exchange Regulation and Foreign Exchange
Control”. The Ukrainian hryvnia (UAH) is the only legal tender on the territory of
Ukraine for transactions between residents, and foreign currency is to be used for
trade turnover between residents and non-residents. Stability of the hryvnia is the
assured by the currency corridor which limits the US dollar exchange rate variation.
The National Bank of Ukraine together with the Cabinet of Ministers determines the
range of the currency corridor and responsible for implementing foreign currency
operations. The Cabinet of Ministers determines and submits the limits of the
country’s external borrowing for parliamentary approval. Foreign currency operations
by residents and non-residents are under the auspices of the State Tax Administration.
The law “On the Regime of Foreign Investments” guarantees the rights of
foreign investors to freely and immediately transfer their profits in foreign currency
abroad; all taxes due on that amount have been paid. The repatriation rights also
apply to the actually invested amounts and property. No special license is needed for
any such repatriation of capital from Ukraine.
Whilst welcoming foreign investment into the country, the Ukrainian
government is also committed to maintaining its national sovereignty, and certain
restrictions in this area are aimed at ensuring this. Foreign shares in the capital of
banks are 35 percent and for audit firms – 30 percent, although figures vary in
different business fields, these two are a good indicator of the general policy.
Ukraine is moving towards a free market economy. An Anti-Monopolies
Committee exists, and is responsible for regulating issue of unfair competition,
mergers and acquisitions, and ensuring impartiality from state executive bodies. Its
brief is to ensure that a maximum number of businesses operate successfully in
Ukraine. To give stability in the transition period to free market, the law on prices
and state-regulated prices applying to all products, goods and services in Ukraine.
22
Vocabulary notes
incentive – побуждающий мотив
under the auspices of – под охраной
merger – соединение, объединение
acquisition – приобретение, поглощение
impartiality – справедливость
elimination of limitations – устранение
ограничений
red tape – бюрократия
accession - допуск
CASE STUDY
Possible Consequences of the Ukrainian Accession to the European Union (EU).
Background information
1) The European Union (EU) was established on the basis of the Treaty of Rome
signed on 25 March 1957 by Belgium, France, Germany, Italy, Luxembourg
and the Netherlands. Its aim was to encourage relations between European
countries after the horror of the Second World War. In 1973 the first EU
countries were joined by Denmark, Ireland and the United Kingdom; in 1981
by Greece; and in 1986 by Spain and Portugal. Austria, Finland and Sweden
joined the EU in 1995.
2) Ukraine is going to join the EU but there are some consequences of joining it
for Ukraine’s Economic Sectors both positive and negative.
Problem
Ministry of Economy appointed the working group consisting of directors of
different enterprises to verify the positive and negative consequences of entering the
EU, how to minimize the possible negative effects and to make the best of EU’s
membership.
Comprehension and Discussion Questions
1. What new opportunity could the EU give to Ukraine?
2. Will prices go down or increase for imported goods and services and domestic
ones?
3. Will there be subsequent changes in the volume and structure of consumption
which would approximate the standards of the developed economies?
4. Will an increased solvent demand have appositive effect on production growth
and improvements in people’s social and economic status?
5. What will the national producers gain from easier access to the world markets
of goods, services and capital?
6. What are the possible negative effects of joining the EU?
7. How will it be possible to defend the national interests of Ukraine?
8. Will the privileges for the national coal-mining, metallurgy, ship building,
automobile-and aircraft-making industries be canceled?
9. What are the main Ukrainian exports now and will they be the same in future?
10.Will the export of tourist services in Ukraine be increased or not?
11.Will the Ukraine’s membership in the EU remove the threat of anti-dumping
investigations?
23
12.What restructural problem is Ukraine likely to be faced with to avoid the
probability of prevailing negative consequences?
Text III. FOREIGN TRADE POLICY OF UKRAINE
At the present stage of Ukraine’s economic development, special attention
should be paid to the following issues: further maturing of foreign trade activities,
ensuring integration of the Ukrainian economy into the structures of world economic
space, and international division of labor. Modern globalization processes require that
Ukraine be involved in the international trade system as widely as possible. The
crucial issue is complete settlement of problems concerning Ukraine’s integration to
the WTO and implementation of provision on partnership and cooperation with the
EU. This will facilitate comprehensive implementation of the potential of Ukrainian
enterprises and attraction of foreign investments.
With this aim, presently, the work at the State Program for Stimulating Export
of products, including high-tech. products, is being completed. The program is
developed with the aim of fulfilling relevant assignments of the President of Ukraine
and Cabinet of Ministers of Ukraine. The program defines export strategy of Ukraine
as a constituent of the policy of structural transformation of the economy.
The Program aims to expand export and enhance its efficiency. To reach this
goal, there are developed and introduced mechanisms aimed at attracting and
accumulating own investment resources, which could become the basis for making
transformations in the national economy, facilitate enhancement of competitiveness
for domestically made products to satisfy needs of interior market and expand export
potential.
Export strategy of Ukraine is aimed at structural transformation of economy,
maturing sectional and territorial structure of production, increase of percentage and
actual volume of products with high rate of processing, especially, knowledge –
intensive products, narrowing of raw materials export, narrowing of ecologically
dangerous and resource-intensive production, which create dependence on supply of
energy resourced, raw materials and semis, and as a result, increase in revenues of the
state and earnings of business entities.
Export strategy foresees:
- Creating equal conditions for all the foreign trade business entities;
- Introduction of efficient system for export control;
- Applying progressive forms of international economic interaction;
- Facilitating development of Ukraine’s investment activities abroad (export of
capital) with the aim of creating joint ventures, implementation of other forms
of the international division of labor;
- Providing stability of legislation, and creating legal backgrounds for the
international division of labor;
- Providing stability of legislation, and creating legal backgrounds for favorable
regime of producers’ operation – exporters of domestic products.
Attention of Ukraine export policy should be mainly concentrated within the
following directions.
24
The first – development of adequate theoretic-methodological basis for
stimulating accelerated development of export potential in compliance with strategic
priorities of the country.
The second – research of macroeconomic preconditions of efficient export
activity, taking into account global experience. Main attention should be paid to the
problem of calculation of economic efficiency of export activity and issue of state
stimulation of export development in priority directions.
The third – settlement of key macroeconomic problems of efficient export
activity, foremost, the problem of marketing approach to export activities,
development of its efficiency at the level of enterprises, efficient usage of
commodities and direct foreign investments with the aim of expanding export
potential.
At last, further development of Ukrainian foreign trade activity is closely
connected with the prospect to integrate into the World Trade Organization,
adherence to the international standards and GAAT rules.
Vocabulary notes
maturing – развитие
assignment – задание
enhance – расти, увеличивать (цену)
rate of processing – уровень производства
1.
2.
3.
4.
5.
6.
7.
raw materials and semis – сырьевые и
полусырьевые материалы
revenue of the state – доход страны
earnings of business entities – достижение
деловых структур
Comprehension and Discussion Questions
What issues should special attention be paid in Ukraine’s economic
development to?
What program has been developed by the Cabinet of Ministers of Ukraine?
What is this program aimed at?
What measures should be applied to improve the state of Ukrainian economy?
What is the export strategy of Ukraine aimed at?
What does the export strategy foresee?
What are the directions of Ukrainian export policy?
25
UNIT III
Text I. BETWEEN MARKET ECONOMY AND DEMOCRACY
Contrary to popular belief, the market economy and democracy – the twin
pillars of Western Civilization – are more likely to undermine than support one
another. What follows is a list of just some of the ways in which they clash:
 In a democratic society, the promotion of the individual is the ultimate goal,
while in a market economy the individual is treated as a commodity – one that
can be excluded or cast aside for want of the right education, skills, physical
characteristics, or upbringing.
 The market economy accepts and fosters strong inequalities between economic
agents, whereas democracy is based on the equal rights of all citizens. By
depriving some people of the ability to meet their basic economic needs, the
market economy also leaves them less able to enjoy their full political rights.
Witness the increasing ranks of unemployed workers in much of the west who
can vote but are otherwise increasingly alienated and deprived of human
rights.
 The market economy resists the localization of power, discourages coalitions
between participants, and encourages selfishness, while democracy depends
upon a clear identification of political responsibility, the coalition of citizens in
political parties, and a general appreciation of our common fate. Democracies
need political parties that are capable of forming platforms based on
compromises between individual points of view, while market economies rely
on competing individual centers.
Inevitable Destruction. Both the market economy and democracy encourage a
herd mentality that can be deeply destabilizing. Known as the self-fulfilling prophecy
syndrome, this tendency can intensity problems, starting runs on market and financial
institution technology is deepening this self-destabilizing and self-destructive
tendency – in both economics and politics – by providing split-second market result
and polling data.
The destructive consequences of this changeability are enormous: markets leave
less and less room for long-term contracts or long-term investments. Older
generations neglect the interests of the young, demanding benefits and pensions that
their children will not be able to sustain, much less enjoy themselves upon retirement.
In politics, unpopular decisions are deferred endlessly for immediate political
considerations. Led by managers and politicians who are increasingly skilled at
defining public opinion and evading responsibility, society grows incapable of
dealing with vital long-term challenges.
When two concepts are contradictory, one of them has to come out on top. It
seems obvious that, all over the world, the market economy today is more dynamic
than democracy. Stronger forces are backing it. The frantic search for money to fund
elections, the spread of corruption, and the scale of the criminal economy are all signs
of the prevalence of the market economy over democratic ethics.
The implications of a triumph of the market economy over democracy would be
profound. Powerful minorities seeking to take full advantage of the market economy
26
will want total control of their resources and will come to view the collective
democratic decisions of poor majorities as intolerable burdens. As legislatures and
court lose power to central banks and corporations, market elites will become stronger
than democratic elites, further undermining the reach and appeal of the public sphere.
Vocabulary notes
to undermine – подрывать
to clash – сталкиваться
ultimate goal – конечная цель
to cast aside – отбросить
for want of – из-за
upbringing – воспитание
to foster – способствовать развитию
inequalities – неравенства
whereas – тогда как
to deprive – лишать
to witness – быть свидетелем
to alienate – отчуждать
inevitable – неизбежный
to rely on – полагаться
1.
2.
3.
4.
5.
6.
7.
8.
herd mentality – стадный менталист
prophecy – предсказание, пророчество
polling
data
–
данные
опроса
общественного мнения
consequences – последствия
to sustain – поддерживать
to defer – считаться
to evade responsibility – уходить от
ответственности
frantic – безумный, неистовый
profound – глубокий
to seek – искать
burdens – тяжести
legislature - законодательство
Comprehension and Discussion Questions
What is a popular belief concerning market economy and democracy?
What is the ultimate goal of the individual in a democratic society and in a
market economy?
Does market economy play a positive role in the life of the people?
What do you think of inevitable destruction under market economy and
democracy?
What is the nature of the contradictions between the young and elder
generation?
Why does society grow incapable of dealing with vital long-term challenges?
Which is more dynamic market economy or democracy?
What are the actions of powerful minorities under market economy?
Text II. THE RISE OF THE MARKET DICTATORSHIP
Eventually, democracy will fade away, having been replaced by market
mechanisms and corruption. We will have a kind of market dictatorship, a “lumpen
market” without strong democratic institutions to serve as countervailing powers.
Political outcomes will be bought and sold, and the market will rule every element of
public life from police protection, justice, education, and health to the very air that we
breathe, paving the way for the final victory of “corporate” economic rights over
individual human rights.
Under such circumstances, Western civilization itself is bound to collapse.
If we want to avert such a crash, we must seek honest answers to several
fundamental questions: What is the real influence of citizen in major decisions? What
27
is the reality of democracy among nations? Why are there always the same winners
and losers? Can poverty be overcome by market mechanisms?
To find answer to these questions, Western civilization should first become more
modest about its own values. We must recognize the need to find a compromise
between the market economy and planning, and between democratic and authoritarian
decision-making mechanisms. We should be exploring ways to organize that
compromise rather than including in triumphalist rhetoric about the globalization of
values.
Indeed, while many people in non-Western civilizations are trying to imitate the
West, a wellspring of opposition to Western values has erupted in many places as
well. In Asia, for example, our way of organizing urban life is increasingly rejected,
as demonstrated by the Malaysian experience, where planners are considering
reorganizing society to deemphasize the automobile. Asian societies suggest possible
answers to the contradictory tenets of the market and democracy; by allowing a
stronger role for the state in protecting citizens against some of the risks of
competition, these societies balance the contradictory forces.
On our own behalf, the West should improve and strengthen democracy in order
to achieve a balance with the power of the market. To accomplish that, we must foster
a new government role in enforcing the rule of law, supporting the principles of
education, ensuring social justice and the participation of workers in corporate
decision making, and leading the fight against corruption and the drug economy.
Small nations must unite with their neighbors to achieve a critical mass in the
face of market-driven globalization – and to be able to summon the achievement of
past generation while not limiting the freedom of choice of future generations (in
terms of culture, language, lifestyle, and ethics, for example).
Western societies must decide when and by what means long-term foreign
residents can be given the right to vote. As the number of expatriots grows with the
development of the global market economy, the right to vote will become essential in
any effort to increase the feeling of partnership between people living on the same
soil. Ultimately, the civilizations capable of organizing their diasporas will be the
winners. We must begin to understand multidimensional citizenship and to recognize
cohesion between groups belonging simultaneously to many different entities. We
also must agree on how to build a flexible, long-term framework for democracy that
goes beyond national constitutions and their amendments. Some dimensions of
human dignity (the right of to childhood, the integrity of the genome, and the rights of
species) are not yet well protected by these constitutions.
Western civilization is no stranger to predictions of decline and fall. Some of
these predictions have been based on historical theory, others on cultural, economic,
or even racial assumptions. For the time being, they have fortunately been proven
wrong. But no one should accept the assumption that any civilization, however
triumphant, is here to stay. Our survival is in our hands.
28
Vocabulary notes
eventually – в конце концов
to fade away – угасать
justice – справедливость, юстиция
countervailing
–
компенсирующий,
уравновешивающий
to avert the crash – предотвратить
катастрофу
outcomes – результаты
to be bound to… - суждено
pave the way – проложить путь
to overcome – преодолеть
modest – скромный, сдержанный
to recognize – признать
decision-making - принятия решений
to forster – воспитывать, готовить
triumphalist – победоносный
wellspring – ключ, источник
1.
2.
3.
4.
5.
6.
7.
8.
to erupt – извергаться, прорываться
to deemphasize – уменьшать значение
to improve – улучшать
to achieve – достигать
to accomplish – свершать
enforcing – соблюдения
the rule of law – господство права
ensuring – обеспечивающий
to summon – призывать
essential – существенный
ultimately – наконец
cohesion – связь, соединение
flexible – гибкий
genome – геном
species – род, вид
assumptions – допущения, предположения
survival – выживание
Comprehension and Discussion Questions
What do you think about the democracy fading away?
Can the rise of the market economy bring Western civilization to collapse?
Prove or reject the idea.
What should be done to avert the crash of Western civilization?
Do you share the opinion of the auther about planning economy and
authoritarian decision-making mechanisms?
Do you support the idea of imitating the West and its market economy?
Who should initiate the changes in market economy regulations and society
reformation, the West or the East?
What are small nations supposed to do in order to achieve a critical mass in the
face of market-driven globalization?
Should Ukraine share the western values and join in the European Union?
What do you think?
Practical Task:
Make up a short summary of the text II.
Text III. THE CRASH OF WESTERN CIVILIZATION:
THE LIMITS OF THE MARKET AND DEMOCRACY
With the end of the Cold War and the collapse of the Soviet empire, the market
economy and democracy appear to have triumphed. Universally praised, these two
central values of Western society have become the prerequisite of any nation seeking
acceptance by the international community or assistance from international financial
institutions. Moreover, history would seem to suggest that the market economy and
democracy together form the equivalent of a virtuous circle. Not only is it seemingly
impossible to have one without the other, but in the long run the two appear to be
29
mutually reinforcing. The market economy needs private property, entrepreneurship,
and innovation, which cannot flourish without freedom of thought, speech, and
movement. Democracy means that people can choose where to live, what to buy and
sell, and how to work, save, and accumulate wealth, none of which is compatible with
the collective ownership of industry. In sum, the market economy and democracy
appear to be deeply intertwined, with both tied to the fundamental concept of private
property.
Yet even the most enthusiastic proponents of both the market economy and
democracy would admit that “market democracies” – a shorthand term adopted in
recent year by exuberant American policymakers – are not easy to create. The
development of a robust market economy in a formerly communist country such as
Russia requires more than privatizing industry and allowing the market to determine
prices. And the establishment of real democracy in a war-torn nation such as
Cambodia calls for more than its much-celebrated free elections. A market economy
and democracy can endure only in nations that maintain certain indispensable feature:
the rule of law, a legal system, a free media, and a social consensus on efficient tax
collection.
Despite the prevalent belief that the market economy and democracy combine
to form a perpetual-motion machine that propels human progress, these two values on
their own are in fact incapable of sustaining any civilization. Both are riddled with
weaknesses and are increasingly likely to break down.
While the cracks in the façade of Western civilization are only just beginning to
show, an x-ray of its foundation might reveal deep weaknesses that could lead to its
total collapse.
Inapplicable Principles. Consider two core institutions of the West: the
private corporation and the civil service. For all our talk of free markets and equality
among individuals, our companies and bureaucracies are organized on the basis of
fixed plans and strict hierarchies. Can we imagine a real market relationship between
divisions of the same company or between a boss and her assistant? Can we imagine
an internal referendum on each decision made by a minister or cabinet secretary?....
Likewise, few Western nations … would appreciate an international
community where true democracy prevailed. If international financial institutions had
followed such a democratic system during the so-called Global Negotiations of the
1980s, there would likely have been a drastic shift in the global distribution of wealth
that would have jeopardized the interest of the West.
Similarly, applying the principles of the market economy both within and
among nations is problematic and undesirable. We know of no Western nations that
seek a free market in justice, law enforcement, national defense, education, or even
telecommunications – and with good reason. Few if any Westerners would want to
live in a country where court rulings were for sale, citizenship and passports could be
purchased at airline ticket counters, and air waves were auctioned off to the highest
bigger without regard to content. And among nations, a free market for nuclear
weapons, illegal narcotics, high technology, potable water, and pollution would
promote the rapid growth of supranational political bodies and powerful non-state
entities capable of challenging national governments.
30
Vocabulary notes
to praise – хвалить
prerequisite – предпосылка
in the long run – в конце концов
seemingly – кажущейся
reinforcing – усиливающий
compatible – совместимый
in sum – одним словом
proponent – поборник, пропагандист
exuberant – буйный, изобретательный
robust – сильный, здоровый
war-torn – разорённый войной
to endure – выносить, терпеть
to maintain – поддерживать
1.
2.
3.
4.
5.
6.
7.
8.
indispensable – незаменимый
prevalent – распространённый
to riddle with – пестреть
cracks – трещины
x-ray – рентген
inapplicable – неприменимый
core – главный, центральный
drastic – коренной
to jeopardize – рисковать
to seek – искать, добываться
court rulings – постановления суда
entities – организация
challenging - противостоящий
Comprehension and Discussion Questions
Do you really believe that the collapse of the Soviet Union brought a triumph
to the West?
Can you prove that the market economy and democracy can be mutually
reinforcing?
Do you really believe that under democracy people can choose where to live,
what to buy and sell, and how to work and accumulate wealth?
What are the prerequisites for a robust market economy to be developed in
Ukraine?
How do you estimate the development of the market economy and democracy
in Ukraine? Are they both riddled with weakness and are increasingly likely to
break down?
What might be the future of Western civilization?
Why can a developed international community true democracy jeopardize the
interest of the West?
The auther of the article considers that applying the principles of the market
economy both within and among nations is problematic and undesirable. Why
then Ukraine is seeking the application of such principles within our country?
Try and give your point of view.
Text IV. THE DEATH OF THE JOB
Every day brings another story of “job losses”. We are told the recession is
over, but the proportion of the workforce that is “jobless” has not fallen as it has after
previous recessions. The government is trying to “create jobs” by easing taxes and
regulations, but says it should intervene more. We hear that the only way to protect
jobs is to increase productivity, yet the result seems to be to make the jobs redundant.
When we were growing up, we used to read that by the year 2000 everyone
would have to work only 30 hours a week and that the rest would be leisure time. But
as we approach the year 2000, it seems more likely that half of us will work 60 hours
a week and the rest of us will be unemployed. What is going wrong?
31
The reality is that what is disappearing today is not just a certain number of
jobs, of jobs in certain industries or in one country – or even jobs in the developed
world as a whole. What is disappearing is the very thing itself: the job.
The job a social artifact, though it is so deeply embedded in our consciousness
that most of us have forgotten its artificiality, or the fact most societies since the
beginning of time have done fine without jobs. In the pre-industrial past, people
worked very hard, but they did not have jobs to frame and contain their activities.
Then jobs became not only common but important: they were nothing less than the
only widely-available path to security and success. Now they are disappearing. ….
So what do people do without jobs? Some possibilities are obvious. You can
start a business on your own; you can become an artist; you can become a consultant;
you can do freelance work, or part-time work, or piecework in your own home. Under
the pressure of dejobbing in organizations, more people than ever before are doing all
of these things. But there is another answer. You can do what more and more people
are doing: working within organizations, but under arrangements too fluid and
idiosyncratic to be called jobs.
“You won’t last at Microsoft if your job is just a job”. That is how Teresa
Stowell, a software design engineer, describes what it is like to work at the Seattle
software powerhouse. To begin with people work any time and all the time, with no
one keeping track of their hours, but with everyone watching their output. They are
accountable not to conventional managers but to the project teams of which they are a
part. …
When a project ends, Microsoft employees move on to a new one, taking with
them the reputation they earned on the last project. There are no standard career
routes. “If people want to change functions or they want to get different experiences,
that’s not frowned on at all. … Employees drive their own development, and we need
to design all of our management and our training programmes to support, augment
and facilitate that development.” …
Just as workers will need to be ready to shift from project to project within the
same organization, they should expect that much more frequently than in the past they
will have to move from one organization to another. Long-term employment is, for
most workers, a thing of the past. The organization will try to minimize these shifts,
recognizing that they are difficult and disruptive to the effectiveness of both the
organization and the worker. But both parties will have to make their long-term plans
with the likelihood of such shift in mind. … Unless we begin soon to re-educate our
workforce in these new expectations and the economic realities that have shaped
them, we are in for decades of economic chaos that will damage our organizations
and devastate several generations of workers.
Vocabulary notes
leisure time – свободное время, досуг
to disappear – исчезать
to embed, embedded – внедрять, внушать
consciousness – сознание
artificiality – искусственность
widely-available – широко доступный
dejobbing – лишение работы
arrangement – договорённость
fluid – неустойчивый
idiosyncratic
–
болезненно
воспринимающий
32
a software design engineer – инженерпрограммист
powerhouse – сильная группа
to earn – зарабатывать
to augment – увеличивать, прибавлять
to frown on – относится с неодобрением
to devastate, devastation – разрушать,
опустошать
redundant – избыточный, лишний
disruptive – разрушительный
Comprehension and Discussion Questions
1. If a government eases taxes, does it raise them?
2. If something is redundant, is it necessary?
3. If something is embedded in your consciousness, do you actively think about
it?
4. Jobs were “nothing less than” the only available part to security? Does this
mean that they were the only path to security, or that there were other paths to
security?
5. What word is used in this paragraph to talk about jobs disappearing?
6. If something is idiosyncratic, is it normal?
7. Do people clock on and off at Microsoft?
8. Should workers be prepared to change projects?
9. If something is disruptive, is it easy to keep going as you were before?
10.If X shapes Y, does X have a lot of influence over the way Y develops?
11.Is devastation
a) slight damage, or
b) serious damage?
Practical Task:
Read through the text and find in each paragraph a topical sentence that renders
the main information.
33
UNIT IV
Text I. A NEW ECONOMY FOR A NEW CENTURY
Today, at the start of the next century, faith in technology and human progress
is almost as prevalent in the writings of the leading economic commentators [as at the
end of the 19th century]. Their easy optimism is bolstered by the extraordinary
achievements of the 20th century, including developments such as jet aircraft, personal
computers, and genetic engineering that go well beyond anything predicted by the
most imaginative futurist of the 1890s. But like their predecessors, today’s futurists
look ahead from a narrow perspective – one that ignores some of the most important
trends now shaping our world. And in their fascination with the Information Age that
is increasingly prominent in the global economy, many observers seem to have
forgotten that our modern civilization, like its forerunners, is totally dependent on its
ecological foundations.
Since our emergence as a species, human populations have continually run up
against local environmental limits: the inability to find sufficient game, grow enough
food, or harvest enough wood has led to sudden collapses in human numbers and in
some cases to the disappearance of entire civilizations. Although it may seem that
advancing technology and the emergence of an integrated world economy have ended
this age-old pattern, they may have simply transferred the problem to the global level.
The challenge facing us at the start of a new century begins with scale. Human
numbers are four times the level of century ago, and the world economy is 17 times as
large. This growth has allowed advances in living standards that our ancestors could
not have imagined, but it has also undermined natural systems in ways they could not
have feared. Oceanic fisheries, for example, are being pushed to their limits and
beyond, water tables are falling on every continent, range lands are deteriorating from
overgrazing, many remaining tropical forests are on the verge of being wiped out, and
carbon dioxide concentrations in the atmosphere have reached the highest level in
160,000 years. If these trends continue, they could make the turning of the
millennium seem trivial as a historic moment, for they may be triggering the largest
extinction of life since a meteorite wiped out the dinosaurs some 65 million years ago.
As we are living in the 21st century, now it is clear that satisfying the projected
needs of an ever larger world population with the economy we now have is simply
not possible. The Western economic model – the fossil-fuel-based, automobilecentered, throwaway economy – that so dramatically raised living standards for part
of humanity during this century is in trouble. Indeed, the global economy cannot
expand indefinitely if the ecosystems on which it depends continue to deteriorate. We
are entering a new century, then, with an economy that cannot take us where we want
to go. The challenge is to design and build a new one that can sustain human progress
without destroying its support systems – and that offers a better life to all.
The shift to an environmentally sustainable economy may be as profound a
transition as the Industrial Revolution that led to the current dilemma was. How
successful we will be remains to be seen. Yet we have always stood out from other
species in our ability to adapt to new environmental conditions and challenges. The
next test is now under way.
34
Vocabulary notes
prevalent – распространённый
jet aircraft – реактивный самолёт
imaginative – одарённый воображением
predecessors – предшественники
genetic engineering – генная инженерия
to predict – предсказывать
forerunners – предшественники
emergence – появление
environmental
[in¸vaiərən'mental]
относящийся к окружающей среде
sufficient – достаточный
disappearance – исчезновение
scale – масштаб
ancestors – предки
to undermine – подрывать
1.
2.
3.
4.
5.
–
to deteriorate ['ditiəriə¸rei] – ухудшаться
to overgraze – выбивать пастбище,
истощать
carbon dioxide [daiəksaid] – углекислый
газ
to trigger – давать начало
extinction – исчезновение (с лица земли)
to wipe out – уничтожать
throwaway
economy
–
экономика,
основана на выбросе отходов
fossil-fuel-based economy – экономика,
основана на ископаемом топливе
challenge – вызов, проблема, задачи
sustainable – устойчивый
species - виды
Comprehension and Discussion Questions
What bolstered optimism and faith of the leading commentators in technology
and human progress of the 20th century?
What are environmental and integrated World economy problems of the 21 st
century?
What are the challenges of the 21st century?
What type of a new economy should be designed for the 21st century?
How should we act in the 21st century in order to build up an environmentally
sustainable economy?
Practical Task
Read through a chosen paragraph and define the most informative words in it.
Text II. THE SHAPE OF A NEW WORLD ECONOMY
As noted earlier, the western industrial development model that has evolved
over the last two centuries has raised living standards to undreamed-of levels for onefifth of humanity. It has provided a remarkably diverse diet, unprecedented levels of
material consumption, and physical mobility that our ancestors could not have
imagined. But the fossil-fuel-based, automobile-centered, throwaway economy that
developed in the West is not a viable system for the world or even for the West over
the long term, because it is destroying its environmental support systems.
If the Western model were to become the global model, and if world population
were to reach 10 billion during the next century, as the United Nations projects, the
effect would be starling. If, for example, the world has one car for every two people
in 2050, as in the United States today, there would be 5 billion cars. Given the
congestion, pollution, and the fuel, material, and land requirements of the current
global fleet of 501 million cars, a global fleet of 5 billion is difficult to imagine. If
petroleum use per person were to reach the current U.S. level, the world would
35
consume 360 million barrels per day, compared with current production of 67 million
barrels.
On consider a world of 10 billion with everyone following an American diet,
centered on the consumption of fat-rich livestock products. Ten billion people would
require 9 billion tons of grain, the harvest of more than four planets at Earth’s current
output levels. With massive irrigation-water cutbacks in prospect as aquifers are
depleted and with the dramatic slowdown in the rise in land productivity since 1990,
achieving even relatively modest gains is becoming difficult.
An economy is environmentally sustainable only if it satisfies the principles of
sustainability – principles that are rooted in the science of ecology. In a sustainable
economy, the fish catch does not exceed the sustainable yield of fisheries, the amount
of water pumped from underground aquifers does not exceed aquifer recharge, soil
erosion does not exceed the natural rate of new soil formation, tree cutting does not
exceed tree planting, and carbon emissions do not exceed the capacity of nature to fix
atmospheric CO2. A sustainable economy does not destroy plant and animal species
faster that new ones evolve.
Once it becomes clear that the existing industrial development model is not
viable over the long term, the question becomes, what would an environmentally
sustainable economy look like? Because we know the fundamental limits the world
now faces and some of the technologies that are available, we can describe this new
economy in broad outline, if not in detail. Its foundation is a new design principle –
one that shifts from the one-time depletion of natural resources to one that is based on
renewable energy and that continually reuses and recycles materials. It is a solarpowered, bicycle/ rail-centered, reuse/ recycle economy, one that uses energy, water,
land, and materials much more efficiently and wisely that we do today.
The challenge in energy is to replace the fossil fuel economy with an efficient
solar economy, defining solar energy sources that derive from the sun directly or
indirectly. Although solar energy in its various forms has been widely considered a
fringe source, it is now moving toward center stage. Wind power, for example, now
supplies 7 percent of electricity in Denmark and 23 percent in Spain’s northern region
of Navarre, including the capital, Pamplona. More important, however, is the
potential. A survey of U.S. wind resources by the Department of Energy concluded
that just three states – North Dakota, South Dakota, and Texas had enough
harnessable wind energy to satisfy national electricity needs. China has enough wind
potential to easily double its current electricity generating capacity.
Vocabulary notes
consumption – потребление
viable – жизнеспособный
congestion – сжигание
cutback – сокращение
aquifer ['ækwifə] – водоносный горизонт
renewable energy – возобновляемая
энергия
solar-powered economy – экономика на
солнечной энергии
recycle economy
– экономика на
вторсысье
bicycle/
rail-centered
economy
–
бицикличная экономика
to derive – извлекать, получать
a fringe source – источник крайнего
использования
harnessable – укрощаемый
capacity – способность, мощность
36
1.
2.
3.
4.
Comprehension and Discussion Questions
What type of economy did the West develop in the 20th century?
If the Western model of life were to become the global model, what do think of
the consequences?
What are the principles of environmentally sustainable economy?
What types of new economies should be developed to keep up our further
industrial progress?
Grammar Task
Read through the text, write out the left Noun Attributes (clusters). Prove your
choice and translate the sentences into Russian.
Text III. REDEFINING PROGRESS IN GLOBAL ECONOMY
At the start of the 21st century, many respected thinkers seem to believe that we
are in for a period of inevitable economic and technological progress. Even the
current economic crisis that has spread misery from Indonesia to Russia is seen as a
brief pause in an unending upward climb for Homo sapiens. In a special double issue
on the economy in the 21st century, Business Week ran a headline proclaiming, “You
Ain’t Seen Nothing Yet”, forecasting even faster rates of economic progress in the
century ahead. The magazine’s editors expect the global economy to ride a wave
technology in the decades to come, solving all manner of social problem, as well as
adding to the investment portfolios of its readers.
This view of the future, fueled by heady advances in technology, is particularly
prevalent in the information industry. It reflects a new conception of the human
species, one in which human societies are seen as free of dependence on the natural
world. Our information-based economy is thought capable of evolving independently
of the Earth’s ecosystem.
The complacency reflected in this view overlooks our continued dependence on
the natural world and the profound vulnerabilities this represents. It concentrates on
economic indicators while largely overlooking the environmental indicators that
measure the Earth’s physical deterioration. This view is dangerous because it
threatens to discourage the restructuring of the economy needed if economic progress
is to continue. If we are to build an environmentally sustainable economy, we have to
beyond traditional economic indicators of progress. If we put a computer in every
home in the next century but also wipe out half of the world’s plant and animal
species that would hardly be an economic success. And if we again quadruple the size
of the global economy but many of us are hungrier than our hunter-gatherer ancestors,
we will not be able to declare the 21st century success.
One of the first steps in redefining progress is to recognize that our generation
is the first whose actions can affect the habitability of the planet for future
generations. We have acquired this capacity not by conscious design but as a
consequence of a global economy that is outgrowing its environmental support
system. In effect, we have acquired the capacity to alter the Earth’s natural systems
but have refused to accept responsibility for doing so. We live in a world that has an
37
obsessive preoccupation with the present. Focused on quarterly profit-and-loss
statements, we are behaving as though we had no children. In short, we have lost our
sense of responsibility to future generations.
Parents everywhere are concerned about their children. In their efforts to ensure
a better life for them, they invest in education and medical care. But unless we now
assume responsibility for the evolution of the global economy, our short-term
investments in our children’s future may not amount to much; our principal legacy to
them would be a world that is deteriorating ecologically, declining economically, and
disintegrating socially.
Building an environmentally sustainable global economy depends on a
cooperative global effort. No country acting alone can stabilize its climate. No
country acting alone can protect the diversity of life on Earth. No country acting alone
can protect oceanic fisheries. These goals can be achieved only through cooperation
that recognizes the interdependence of countries.
Vocabulary notes
inevitable – неизбежный, неотвратимый
misery – нищета, бедность
to forecast – предсказывать, делать прогноз
complacency – удовлетворённость
profound – глубокий
vulnerability [¸v٨lnərə'biliti] – уязвимость
dangerous – опасный
to threaten – угрожать
to discourage – препятствовать
to quadruple [kwodr٨pt] – учет верить
hunter-gatherer ancestors – предки,
жившие охотой и собирательством
1.
2.
3.
4.
5.
6.
to redefine – по новому определить
habitability – пригодность для проживания
to acquire [ə'kwaiə] – приобретать
obsessive preoccupation – навязчивая
озабоченность
quarterly – квартальный
profit-and-loss statements – сводки о
доходах и убытках
to assume responsibility – принять на себя
ответственность
legacy – наследие
Comprehension and Discussion Questions
What are the expectations and hopes for a new economic success in the 21st
century?
What view of the future is prevalent in the information industry?
Is it possible to develop a new economy without dependence on the natural
world and environment?
What are the first steps in redefining progress in global economy?
What is the global concern of the parents?
Acting alone, can a country stabilize its economy?
Text IV. GLOBALIZATION OF WORLD ECONOMY
Over the last two decades we have witnessed the globalization of markets and
production. The globalization of markets implies that national markets are merging
into one huge marketplace. The globalization of production implies that firms are
basing individual productive activities at the optimal world locations for the particular
activities. As a consequence, it is increasingly irrelevant to talk about “American“
products, “Japanese” products or “German” products since these are being replaced
38
by “global” products. The global acceptance of Coca Cola, Levi’s jeans, Sony
Walkmans, and McDonald’s hamburgers exemplifies this trend.
Two factors seem to underline the trend toward globalization: declining trade
barriers and changes in communication, information, and transportation technologies.
Since the end of World War II there has been significant lowering of barriers to
the free flow of goods, services, and capital. More than anything else, this has
facilitated the trend toward the globalization of production and has enabled firms to
view the world as a single market. As a consequence of the globalization of
production and markets, in the last decade, world trade has grown faster than world
output, foreign direct investment has surged, imports have penetrated more deeply
into the world’s industrial nations, and competitive pressures have increased in
industry after industry.
The development of the microprocessor and related developments in
communication and information processing technology have helped firms link their
worldwide operations into sophisticated information networks. Jet air travel, by
shrinking travel time, has also helped to link the worldwide operations of
international businesses. These changes have enabled firms to achieve tight
coordination of their worldwide operations and to view the world as a single market.
Over the last three decades a number of dramatic changes have occurred in the
nature of international business. In the 1960s the U.S. economy was dominant in the
world, U.S. firms accounted for most of the foreign direct investment in the world
economy, U.S. firms dominated the list of large multinationals.
By the end of the 1980s, the U.S. share of the world output had been cut in half,
with major shares of world output being accounted for by Western European and
Southeast Asian economies. The U.S. share of the worldwide foreign direct
investment had also fallen, by about two-thirds. Moreover U.S. multinationals were
now facing competition from a large number of Japanese and European
multinationals. In addition, the move toward free market economies in the countries
of Eastern Europe, China and Latin America is creating opportunities (or threats) for
Western international business.
Vocabulary notes
to exemplify – быть примером
multinationals
–
транснациональные
корпорации
to surge – подниматься, расти
to merge – сливаться
to penetrate – проникать
global acceptance – мировое восприятие
huge – огромный
to imply – подразумевать
consequence – следствие
irrelevant – неуместный
to facilitate – облегчать, содействовать
to enable – давать возможность
to occur – происходить, случаться
to account for – отвечать, отчитываться
major share – главная доля
CASE STUDY
Opening McDonald’s in Chernigiv
Background information
McDonald’s, an international firm, was established in 1955. By the early
th
1980 , after three decades of rapid growth, the U.S. fast-food market was beginning
39
to show signs of market saturation. McDonald’s response to the slowdown was to
expand abroad rapidly. By 1998 the firm had 4.700 restaurants in 76 countries outside
the United States with 24% annual growth of foreign revenues and profits. By the
beginning of the XXI century 68% of the chain’s new restaurants openings were
abroad.
Problem
McDonald’s plants to expand its fast-food market in Ukraine and open some
restaurants in Chernihiv. The Marketing Department of McDonald’s in Ukraine has
organized an informal departamental meeting to brainstorm the ideas for the openings
of MACs in Chernihiv.
Discuss the problem using the questions.
Brainstorming Session
1. Will citizens of Chernihiv prefer McDonald’s to their local restaurants and
why?
2. Will there be any problems with hiring and training local personnel?
3. Will you keep to the same standardized operating procedures that have been the
hallmark of its success in the United States?
4. Will you add some local products on the MAC menu? (In Brazil, for example,
McDonald’s sells a soft drink made from guarana, an Amazonian berry).
5. Will you avoid the suburban locations typical in the United States and stress
urban sites that consumers can walk to?
6. Ideas for local TV or radio advertisement. Also, newspapers and magazines.
7. Your ideas about the price policy. Will it be in the medium range?
8. Will you set up a joint venture that’ll play a key role in learning and
transplanting the organization’s values to local employees?
9. What about the local suppliers? Will they be able to produce goods of the
demanded quality? (McDonald’s maintains very vigorous specifications for all
raw ingredients it uses).
10. Your ideas about the modular stores that can be moved over a weekend and
used to set up temporary restaurants at big outdoor events or satellite stores for
organization of mini- McDonald’s, which can be used in hospitals, sport arenas
and sea beaches.
11.Will your success be built on the following formula:
- close relations with suppliers;
- nationwide marketing might;
- tight control over store-level operating procedures;
- a franchising system.
Text V. INTERNATIONAL DIGITAL ECONOMY
We’re finding a very, very rapid growth now of commerce on the Internet,
particularly in the area of businesses working with other businesses. Many businesses
are beginning to put their purchasing, supply chain management, inventory control,
customer relations, and logistics, on the Internet. And we think there will be over
40
$300 billion of business-to- business commerce of this sort on the Internet within four
years.
The companies that have begun working like this – companies like General
Electric, Boeing, Cisco, Federal Express, and Wal-Mart – are experiencing very
dramatic productivity improvements as a result. Cisco, the high-tech company that
makes Internet routers, began to sell on the Internet only 18 months ago, and already
a third of its sales, two billion dollars, are on the Internet.
We’re also finding that companies that serve consumers through the Internet
are beginning to grow very rapidly. A new company called “Amazon.com.” just
began selling books on the Internet two year ago. In their first year, they sold $16
million of books. This past year they sold $150 million worth of books, and now their
major competitors, traditional chains of bookstores, are going on-line.
We think that about 20 percent of all books sold in the United States next year
may be sold on the Internet – up from nothing three years ago. We’re seeing similar
Internet sales growth in products as varied as retail banking services, airline tickets,
flowers, even automobiles. So, this is an area of very rapid growth.
In general, we think that the Internet and electronic commerce are still
developing faster in the United Stares than in Europe. I should say that Internet use is
spreading rapidly in Europe now, but electronic commerce, we think, is for now
growing faster in America. There are also major differences within Europe. From the
statistics that we’ve seen, and from what I’ve learned on recent trips, a number of the
Scandinavian countries, for example, are adopting the Internet and electronic
commerce at about the same pace as the United States – quite rapidly. Some of them
even have a higher per capita usage of the Internet that we do in the United States. I
think if Europe focuses on developing the right climate for electronic commerce, it
will catch up very quickly.
The U.S. government believes that it’s best for our economy and best for the
development of this new digital age to try to set a predictable legal environment
globally for the conduct of commerce. That means trying to agree on common
frameworks for things like document authentication, digital signatures, the formation
of contracts, and the protection of intellectual property.
But, in general, we think that governments should stay away from regulating,
over-taxing, or censoring the Internet because we fear that if governments become too
involved – if they create this as a regulated industry in some way – that will strangle
the growth potential that we see.
We advocate a market-oriented approach to the development of the
development of the digital economy. We feel this approach should not be similar to
the way we in the United States have historically regulated the telecommunication or
broadcast industries. We believe Internet commerce should be an environment where
buyers and sellers can come together free of government interference, and it should
be a contract-based system. In principle these development should be led by the
private sector, and privately established codes of conduct should govern, not
government regulations.
41
Vocabulary notes
rapid growth – быстрый рост
to purchase – производить закупки
productivity improvements – улучшение
(рост) производительности
to
supply
chain
management
–
обеспечивать постоянный менеджмент
to experience – испытывать, переживать
consumers – потребители
to vаry – варьировать, разнообразить
retail banking services – банковское
обслуживание розничной торговли
to adopt – принимать, пользоваться
at the same pace – с такой же скоростью
1.
2.
3.
4.
5.
6.
per capita usage – использование на душу
населения
to catch up – догнать
digital age – век цифровой (электронной)
технологии
predictable – предсказуемый
digital signature – электронная подпись
(знак)
framework – структура
over-taxing – чрезмерное налогообложение
censoring – цензура
environment – окружение
broadcast – широковещательный
Comprehension and Discussion Questions
What services can be put on the Internet today?
Can modern companies experience any productivity improvement using the
Internet services?
Do the Internet services influence the growth of companies?
Where is the electronic service developing faster in Europe or in the United
States?
Is it possible to set a predicable environment globally for the conduct of
commerce?
Why should governments stay away from the global Internet regulating global
economy?
Practical Task:
Make up a short summary of text V using a topical sentence of each paragraph.
42
UNIT V
Text I. INTERNATIONAL TRADE AND INTERNATIONAL BUSINESS
International trade is the system in which countries exchange goods and
services. It occurs when a firm exports goods and services to consumers in another
country.
International trade allows a country to specialize in the goods and services that
it can produce at a relatively low cost and export those goods in return for imports,
whose domestic production is relatively costly. International trade enables the
country – and the world – to consume and produce more than would be possible
without trade.
Aside from the tangible benefit of increasing the world’s output of goods and
services, trade has intangible benefits as well.
 Trade offers diversity to our lives and work. The advantages of particular
climates and lands are shared: the United States imports oil from the hot
desert of Saudi Arabia to drive cars in cool comfort. Ukrainians can enjoy
coffee, bananas, and spices without living in the tropics; and we can have
the economy and durability of Japanese cars without driving in hectic
Tokyo. Thus, international trade enables us to enjoy a more diverse menu of
goods and services than would be possible without trade.
 World trade also encourages the diffusion of knowledge and culture because
trade serves as a point of contact between people of different lands.
An international business is any firm that engages in international trade or
investment. The task of managing an international business differs from a domestic
business in many ways.
International business is different from domestic business for at least four
reason:
1. Countries are different (in their culture, political systems, economic
systems, legal systems and level of economic development).
2. The range of problems confronted by a manager in international business is
wider and the problems themselves more complex than those confronted by a
manager in a domestic business.
International business must decide:
 Which foreign markets to enter and which to avoid;
 Where to site its production activities to minimize cost and to maximize value
added;
 How best to coordinate and control its globally dispersed production activities;
 How to choose the appropriate mode for entering a particular foreign country.
3. International business must find ways to work within the limits imposed by
government intervention in the international trade and investment system.
International business:
 Involves transactions across national borders;
 Must deal with government restrictions on international trade and investment;
43
 Must find ways within the limits imposed by specific government interventions
in the sphere of international trade and investment;
 Has to regulate cross-border trade and investment and to develop strategies and
policies for dealing with restrictions.
4.
International transactions involve converting money into different
currencies.
Cross- border transactions require:
 That money be converted from the firm’s home currency into a foreign
currency and vice versa;
 International business must develop policies for dealing with exchange rate
movements since currency exchange rates are not stable over time and vary to
changing economic conditions.
Vocabulary notes
international trade – международная
торговля
domestic trade – внутренняя торговля
international business – международный
бизнес (международная коммерческая
деятельность)
goods and services – товары и услуги
to produce goods – изготавливать товары
to consume goods – использовать товары
tangible benefits – материальная выгода
intangible benefits – нематериальная
выгода
to offer diversity – предлагать,
разнообразие
to encourage diffusion – поощрять
распространению
to enter а market – появляться на рынке
1.
2.
3.
4.
5.
6.
7.
to avoid а market – увиливать от
вхождения на рынок
government intervention – вторжение
государства
international
transactions
–
международные денежные операции
cross-border trade – пограничная торговля
currency – валюта
currency exchange rate – обменный курс
валют
to convert into foreign currency –
конвертировать в иностранную валюту
to minimize cost – уменьшать расходы
value added – надбавочная стоимость
value added tax – налог на набавочную
стоимость
Comprehension and discussion questions:
What is the difference between international trade and international business?
When does international trade occur?
What are the tangible and intangible benefits of international trade?
What is international business?
What are the main reasons in which international business is different from
domestic one?
Which problems should a manager in international business solve?
What do international transactions solve?
Ex. 1. Match the Russian terms with their English equivalents.
a)обменный курс
1. goods and services
b) поощрять распространению
2. to minimize cost
c) материальная
(нематериальная) 3. to consume goods
выгода
44
d) уменьшать расходы
e) прибавочная стоимость
f) международная коммерческая
деятельность
g) товары и услуги
h) предлагать, разнообразие
i) международные денежные операции
j) пограничная торговля
k) использовать товары
4. international business
5. international transactions
6. to offer diversity
7. currency exchange rate
8. to encourage diffusion
9. tangible (intangible) benefits
10. value added
11. cross-border trade
Ex. 2. Translate the sentences into English using the key terms given in Ex.1.
1. К материальным выгодам международной торговли принадлежит
увеличение мирового производства товаров и услуг.
2. Международная торговля имеет следующие нематериальные выгоды:
она предлагает разнообразие для нашей жизни и поощряет распространение
знаний и культуры других стран.
3. Большие американские транснациональные корпорации преобладают в
международной коммерческой деятельности с 60-х годов ХХ ст.
4. Разные страны имеют разные валюты. Для того, чтобы заниматься
международной торговлей и международным инвестированием, необходимо
конвертировать деньги в разные валюты. Международные денежные операции
включают конвертацию денег в валюту страны, с которой осуществляется
торговля.
5. Международный бизнес должен решать важный вопрос – где в мире
распространить производство, чтобы максимально уменьшить расходы и
увеличить прибавочную стоимость.
6. Международная торговля даёт шанс стране больше производить и
использовать товаров.
7. Пограничная торговля предполагает конвертацию отечественной
валюты фирмы в иностранную, используя обменный курс валюты.
Ex. 3. Modal verb “must” and its equivalents.
Function
1. strong
obligation
2. general
obligation
(necessity)
3. general
obligation
(planned
necessity)
4. probability
likelihood
Present
Past
must do
-
have (has)
to do
have got to do had to do
(British, English, had got to do
more informal)
am (is, are) to do
must be
done
was (were) to
do
Future
Translation
должен
должно
shall (will) have to должен будет…
do
должен был
shall (will)
обязательно
have got to do
должен будет…
will be likely to do
will be certain to do
должен по
плану, договору,
приказу
наверное будет...
определённо
45
must be
doing
must have
been doing
must have
done
will probably do
will evidently do
будет…
вероятно
будет…
очевидно
будет…
Ex. 4. Translate the sentences into Russian and state which of them expresses
probability and which obligation.
Model: They must have signed a treaty – (probability)
Они, наверное, подписали договор.
You must attend this conference – (obligation)
Вы должны посетить эту конференцию.
1. International business must develop policies for dealing with exchange rate
movements.
2. Representatives of foreign business must be interested in information
concerning Ukraine.
3. The Ukrainian-American summit is to be held in Kyiv by the end of this
month.
4. The trade delegation from Canada must have arrived to Borispol airport an
hour ago.
5. Still more joint ventures and foreign businesses are likely to appear in
Ukraine.
6. They must be prepared for signing of the draft treaty.
7. An international business must decide which foreign markets to enter and
which to avoid.
8. They’ll have to inform the representatives of the World Trade Organization
(WTO) on the outcome of the Ukrainian-Swedish negotiations.
9. During the 1920s and 30s many nations must have erected formidable
barriers to international trade and investment.
Ex. 5. Translate the following sentences into English paying attention to the
Modal verb ‘must’ and to its equivalents.
1. Международный бизнес должен рассматривать вопрос об ограничении
страной международной торговли и инвестирования.
2. Наверняка, конференция по международной торговле тянется с утра.
3. Все граждане Украины должны придерживаться Конституции страны.
4. Они, наверняка, уже решили вопрос вступления Украины в ВТО
(Всемирная организация торговли).
5. Международный бизнес должен решать вопрос конвертации и
установления обменного курса валют.
6. Наверное, представителей иностранного бизнеса интересует
информация об Украине.
7. Вашей группе придется составить экзамен по курсу «Международная
экономика» в июне.
46
8. Они, наверное, уже подготовили все необходимые документы к
проведению семинара.
9. Мы должны рассмотреть вопрос глобализации мировой экономики и
узнать разницу между международным и отечественным бизнесом.
Text II. WORLD ECONOMY
The world economy is increasingly becoming a single economic unit.
Individual national economies are developing closer linkages through trade, capital
investment, and financial institutions. Multinational corporations spread their
activities across national boundaries, and the international banking system carries on
banking activities throughout the world.
During the last two decades, while world output has been growing about 4 %
per year, world trade has been growing about 8% and production by foreign
subsidiaries has been growing by some 10%. Export and import shares of output have
increased considerably in practically all industrial sectors. A growing percentage of
world trade is becoming intra-industry trade (reflecting economies of scale and
increased demand for differentiated products) and even intra-firm trade by
transnational firms (reflecting decomposition of production activities around the
world).
The inter-enterprise international division of labour influences relations
between the developed and developing countries primarily because the giant
international companies transfer certain labour intensive production phases or whole
production cycle to the developing countries where a cheap and sufficiently qualified
(literate, easily teachable) labour force is already available.
The closer integration of developed countries steps up the further progress of
the division of labour and facilitates its better organization. The major part of the
world-wide demand for new machinery and equipment that accelerate industrialtechnological development is met by industrially developed countries. International
exports of armaments continue to be an important factor for increasing their export as
well.
The weight of developing countries in world trade is gradually declining. In the
seventies the newly independent states played an important role in the world economy
and international politics. Their share in world production increased, and they were
able to launch a campaign for a new international order. Almost all over the
developing world foreign mining concessions were nationalized, raw material prices
rose sharply, and the industrialized states became more heavily dependent for raw
material supplies on the former colonies. But using their economic might and
technological superiority, they have created and perfected new forms of enslavement:
technological, food and financial. They have managed to integrate the developing
countries’ economies yet more fully into the world capitalist economy and thus made
them more vulnerable to market fluctuations. After the rise in the price of raw
materials, develop resource-saving technologies and synthetic structural materials,
recycle waste matter and extract its own minerals. This led to a reduction in the
47
utilization of raw materials per unit of social product and diminished the West’s
dependence on supplies of raw materials from Asia, Africa and Latin America.
Similar processes were observed in the petroleum sphere. The oil price slide is
an integral part of the general strategy of the West, aimed at increasing the
dependence of the developing countries and solving its own financial and economic
problems at their expense. Buying raw materials from the developing countries, the
industrially developed nations process them and then sell the goods manufactured
back to the original suppliers for prices ten times higher than the materials cost.
Vocabulary notes
transnational
corporation
(TNC)
–
транснациональная корпорация
multination
corporation
(MNC)
–
многонациональная корпорация
linkage – связь (взаимозависимость
развития отраслей экономики)
to develop linkages – развивать связи
subsidiary
[səb’sidjəri]
–
дочерняя
компания;
филиал,
контролируемый
материнской фирмой с помощью пакета
акций или других экономических рычагов
intra-industry trade – внутриотраслевая
торговля
economies pl.зд. – экономия, бережливость
economies
of
scale
–
экономия,
обусловленная
ростом
масштаба
производства
(возникающая
при
расширении
объема
экономической
деятельности)
differentiated
product
–
дифференцированные продукты
intra-firm trade – внутри фирменная
торговля
decomposition of production activities –
расчленение ранее единого процесса
производства
inter-enterprise division of labour –
внутрифирменное разделение труда
1.
2.
3.
4.
5.
to transfer [træns’fə:] – 1. переносить,
передавать; 2. переводить (деньги)
transfer [‘trænsfə:] – 1. перенесение,
передача; 2. трансфер (т); безвозмездная
социальная
выплата
(в
системе
национальных счетов); 3. перевод (денег),
перечисление (сумм)
labour intensive production phase –
трудоемкий этап производства
export [’ekspo:t] – экспорт
to export [eks’po:t] – экспортировать
import [’impo:t] – импорт
to import [im’po:t] – импортировать
concession – концессия
foreign mining concessions – иностранные
концессии в добывающей
промышленности
vulnerable (to…) – уязвимый,
незащищенный (от…)
market fluctuations – колебание цен на
рынке
to economize on smth. – экономить на чемлибо
resource-saving technologies –
ресурсосберегающие технологии
to recycle waste – перерабатывать отходы
social product – общественный продукт
Comprehension and Discussion Questions
What characterizes the world economy at the end of the 20th century?
What is typical of world trade at the present time? How has it been developing
during the last two decades?
What influences relations between the developed and developing countries?
What are the specific features of foreign trade relations of industrially
developed countries?
Why is the weight of developing countries in the world trade gradually
declining?
48
6. What new forms of enslavement of the former colonies have advanced
countries created?
7. What measures have Western countries taken to diminish their dependence on
developing countries?
Ex. 1. Read the text and do the tasks:
a) Find the terms characterizing the world economy in the 90s.
b) Give the terms which are used to show changes in world trade.
c) Describe the way the Western countries diminish their dependence on
developing countries using the economic terms of the text.
Ex. 2. Translate the following sentences into English in writing. Make use of the
Vocabulary notes, if necessary.
a) Мировая экономика все больше становится единым экономическим
целым. Страны развивают тесные связи через торговлю, инвестиции
капитала и финансовые институты.
b) За последние два десятилетия практически во всех промышленных
отраслях увеличилась доля экспорта и импорта.
c) Растущую долю в мировой торговле занимает внутриотраслевая и
внутрифирменная торговля.
d) Внутрифирменное международное разделения труда влияет на отношения
между развитыми и развивающимися странами главным образом потому,
что ТНК осуществляют передачу трудоёмкого производства в
развивающие
страны,
где
есть
дешёвый
и
достаточно
квалифицированный труд.
e) Более тесная интеграция развитых стран ускорит дальнейшее разделение
труда и будет способствовать его лучшей организации.
f) Доля развивающихся стран в мировой торговле постепенно снижается.
g) Индустриальные страны создали новые формы порабощения бывших
колоний: технологические, продовольственные и финансовые. Им
удалось интегрировать экономику развивающихся стран в мировую
капиталистическую экономику и таким образом сделать их более
открытыми для колебаний мирового рынка.
h) Рост цен на сырьё заставил западные страны предпринять меры по
экономии сырьевых материалов, по развитию ресурсосберегающих
технологий и по переработке промышленных отходов. Это снизило
зависимость Запада от стран Азии, Африки, и Латинской Америки.
Text III. THE HISTORY OF WORLD TRADE
The earliest trade we do know something about is the caravan trade across the
deserts of Asia around 2500 BC to and from cities in Mesopotamia, Egypt, and
Arabia. These caravans had to carry fodder for the animals and food for the drivers
and merchants. Not much space was left for the cargo. As a result, the goods carried
49
were light but valuable, things such as gold and precious stones – that is, luxuries and
not necessities.
After this, trade by sea started to become more common. The Phoenicians on
the coast of Syria are thought to have been the first to develop commerce by sea
around 1000 BC.
The Phoenicians lived at the same time as Greeks and the Romans. Athens was
the first big commercial city in Europe, and it was the first community to import and
export necessities in large quantities. Grain was imported for the increasing
population from the shores of the Black Sea, and exports included figs, olive oil,
wine, honey, pottery, metalware, and textile.
The Roman Empire (27 BC – 476 AD) was the next big trading community.
Increasing quantities of luxuries were imported from the East and North Africa.
Imports included tin, slaves, cloth, and jewels. The Romans also traded with China,
and brought back silkworms to start a silk industry in Europe.
In the fifth century AD, Byzantium (later called Constantinople and now
Istanbul) became the political capital of the Roman Empire, and remained the world’s
commercial capital until the 12th century.
In the 12th and 13th centuries, Venice and Genoa became the world’s leading
trade centres. In 1271, the Venetian, Marco Polo, went by land and sea to China and
helped establish trading links. Venice was well placed to be the main European
commercial centre.
The modern World began as the “Age of Discoveries”. The great voyages of
Spanish and Portuguese explorers, such as Christopher Columbus (1492), Vasco da
Gama (1498), and Ferdinand Magellan (1519), opened up new trade routes to Africa,
and India. This was the beginning of ocean travel.
By the 17th century, the Dutch dominated the world’s trade, with the French
and the English as their close rivals. All three nations opened up the tropical lands of
the East and West Indies, and imported sugar, tobacco, tea, and coffee into Europe.
During the 19th century, the industrial revolution led to greater production, and
the pattern of World Trade started to become what it is today.
Today, we seem to witness the globalization of world trade. We move toward a
system in which national markets are merging into one huge global marketplace.
Thus, in many industries we are not talking about “German market”, “American
market”, Ukrainian market”, but about the global market.
Companies such as Coca-cola, McDonald’s, Levi’s jeans are the vivid
examples of this trend of development.
Task 1. What do you think:
- When did people first start trading?
- What were the earliest goods to be traded?
- Can you give the names of great explorers who opened up new trade routes?
- What does Ukraine export and import? What countries does Ukraine trade with?
50
Task 2. Read through the new words and try to memorize them.
1. flint
кремень
2. slave
раб, невольник
3. desert
пустыня
4. fodder
корм
5. cargo
груз
6. precious stones
драгоценные камни
7. luxury
предмет роскоши
8. necessity
предмет необходимости
9. pottery
фаянс
10. jewels
драгоценные камни
11. silkworm
шёлкопряд
12. explorer
исследователь
13. trade routes
торговые пути
14. rival
конкурент, соперник
15. to witness
быть свидетелем
16. to merge
соединятся
17. vivid example
яркий пример
Task 3. Read and pronounce correctly the following geographical names:
1. Mesopotamia [,mesəpə’teimjə] Месопотамия
2. Egypt [i:dзipt] Египет
3. Phoenicians [fi’ni∫iənz] финикийцы
4. China [‘t∫ainə] Китай
5. Byzantium [bi’zæn∫iəm] Византия
6. Venice [‘venis] Венеция
7. Genoa [‘dзenouə] Генуя
8. East and West Indies [i:st ənd ‘west ‘indiz] Ост и Вест-Индия
9. Europe [‘juərəp] Европа
Read through the text and answer the following questions:
- What is known about the beginning of trade?
- What do you know about the earliest trade which starter across the deserts of
Asia around 2500 BC?
- Who is thought to been the first to develop commerce by sea?
- Which city has become the political capital of the Roman Empire and the
world’s commercial capital?
- When did Venice and Genoa become the world’s leading trade centers?
- When did the modern world begin?
- Who dominated the world’s trade by the 17th century?
- When did the pattern of the world trade start to become what it is today?
- How do you understand the process of globalization of the world trade?
51
Text IV. BALANCE OF TRADE
As nations engage in world trade, some of them end up with a favourable
balance of trade, in which exports exceed imports and other have an unfavourable
balance of trade, in which imports exceed exports.
Economists today recognize that a nation that sells abroad must also buy from
foreign nations, in order to give them its currency to use in purchasing its goods.
History also reveals a correlation between the economic development of a
nation and the status of its balance of trade. Emerging or developing nations are
generally heavy importers especially of machinery, equipment, and various types of
finished goods. Exports in a nation’s, lacking aid and investment capital, must finance
imports by diverting sufficient quantities of natural resources and agricultural
commodities from domestic to foreign (export) uses. As a country develops and is
able to produce more of its own capital and finished goods, it will have less need for
imports and an even balance of trade may come about. Finally, with its debts
liquidated, a fully developed industrial nation tends to be a large exporter of capital.
Consequently, a nation may shift from being a longtime debtor to being a creditor as
its balance of trade shift from one side to another.
More important than balance of trade in international economics is the balance
of payments. Although the flow of merchandise constitutes a major category on
international transactions, it constitutes only part of a nation’s balance of payments.
The balance of payments is statistical account (current and capital) of the
financial transactions between nations over a period of 1 year.
Most transactions in the current account involve the purchase and sale of goods
and services: income from merchandise trade and income generated from services
performed by one country for another. The current accounts include investment
income, interest, dividends, corporate profits and military transactions. The final item
in the current account consists of unilateral transfers (foreign aid, emergency relief
etc.).
The capital account depicts the flow of capital investments between nations: the
purchase and sale of physical assets and financial assets.
Any international transaction that provides a claim for payment from another
country is entered as a credit in the balance of payments of a given country and
recorder with a + sign. Conversely, a debit is recorded whenever a transaction gives
to a claim by foreign countries for payment from a given country. Debit transactions
are designated by asign.
Vocabulary notes
a favourable balance of trade – активный
(благоприятный) торговый баланс
an unfavourable balance of trade –
пассивный (неблагоприятный) торговый
баланс
diversion – отвлечение, сокращение
(ресурсов, торговли)
merchandise [’mət∫ əndiz] – товары
the flow of merchandise – движение товара
current account – счет текущих операций
capital account – счёт движения капитала
corporate profits – прибыль корпораций
unilateral transfers зд. – односторонняя
передача средств
emergency
relief
–
помощь
при
чрезвычайных обстоятельствах
physical assets – физические активы
claim for payment – платёжная претензия
52
1.
2.
3.
4.
5.
Comprehension and Discussion Questions
What is the balance of trade and how is it correlated with the economic
development of a nation?
How does a developing nation finance its imports?
What is the balance of payment and why is it more important than balance of
trade in international economies?
What is the current account and what is the capital account?
What is debit and credit?
Ex. 1. Read the text and do the tasks:
a) Give adjectives which are used to characterize “balance of trade”. Translate
them into Russian and explain their meaning.
b) Give all the meanings of the word “account” you know. Show the difference by
using the word in sentences of your own.
c) Explain what are physical.
Ex. 2. Translate the following sentences into English in writing. Make use of the
Vocabulary notes, if necessary.
a) По мере вовлечения наций в мировую торговлю, одни страны завершают
свои операции с благоприятным балансом торговли, а другие имеют
неблагоприятный торговый баланс.
b) Существует тесная взаимосвязь между экономическим развитием нации и
состоянием ее торгового баланса.
c) На ранних стадиях национального экономического развития экспорт
обычно состоит из сырьевых материалов. Развивающаяся страна, как
правило, финансирует импорт за счёт продажи природных ресурсов.
d) По мере своего развития страна будет всё больше производить
собственного капитала и готовых товаров, и всё меньше будет нуждаться
в импорте.
e) В мировой экономике более важную роль, чем торговый баланс, играет
баланс платежей (или платежный баланс).
f) Платёжный баланс является статистическим расчётом финансовых
операций между странами за период равный одному году.
g) Большинство операций по текущим счетам представлены куплейпродажей товаров и услуг.
h) Счёт движения капитала показывает перемещение инвестиций между
странами, в том числе покупку и продажу физических и финансовых
актов.
53
UNIT VI
Text I. CAPITAL INVESTMENTS
When mobilizing resource for its development, a country must rely on transfers
of foreign resources until it achieves the capacity for self-sustaining growth. Capital
flows in the form of foreign aid, private foreign investment, and private bank lending
are the principal ways by which resources can come from rich to poor countries. The
transmission of technology, ideas and knowledge are other special types of resource
transfer.
The recent expansion in exports of manufactures from the newly industrializing
countries has been closely related to foreign investment by multinational or
transnational corporations (TNCs).
Transnational corporations, large-size firms with sales running into hundreds of
millions of dollars, with more than 25,000 foreign affiliates, are scattered around the
globe, employing some 25 million people. Most parent companies of TNCs are
located in the developed countries. The United States, together the United Kingdom,
France and Germany, account for 80 per cent of foreign activities by TNCs.
The United States is the largest home country for TNCs and the second largest
host country for foreign direct investment. As the world’s largest developed market
economy, the United States therefore continues to play a leading role in the
internationalization of the economic activity. Approximately three of every 10 foreign
affiliates in developed market economies (mainly concentrated in the European
industrial market and the Near East oil market) are associated with United Statesbased transnationals.
All the TNCs are in fact national companies that have extended their operation
abroad. By its multinational operations and intrafirm transactions, the TNCs
transcend the national barriers to commodity trade and impediments to international
factor movement. It is a unit of integration in the world economy. The population of
TNCs has increased remarkably, and many more large firms operate an expanding
number of foreign subsidiaries in a number of countries.
While in the world as a whole foreign subsidiaries continue to be principal
from of the extension of TNCs into host countries, a variety of other forms of
participation of TNCs in foreign economies have made their appearance in recent
years: joint ventures, licensing, management contracts, franchising, turn-key
operations, international subcontracting and a number other contractual arrangements.
Vocabulary notes
affiliate– филиал, контролируемый фирмой
parent company – материнская компания
home country – страна происхождения
международной корпорации
host country – принимающая страна,
страна-реципиент
United States-based transnational – ТНК,
базирующаяся в США
to
transcend
[træn’send]
(limit,
boundaries, barriers) – переступать
(пределы, границы, барьеры)
international
factor
movement
–
международное
движение
факторов
производства
licensing – предоставление (выдача)
лицензии, лицензирование
54
management contract – контракт на
управление производством
franchising – особый (специальный)
контракт, франшизинг, выдача компанией
лицензии на производство или продажу
товара под её маркой
1.
2.
3.
4.
5.
turn-key operations – строительство «под
ключ»
subcontracting – заключение контрактов с
субподрядчиками
contractual arrangements – договорные
соглашения
Comprehension and Discussion Questions
What are the principal ways by which resources can come from rich to poor
countries?
What is a transnational corporation and what is its role in world trade?
What is the difference between home and host countries?
How do transnational corporations operate?
What other forms of participation of TNCs in foreign economies do you know?
Ex. 1. Read the text and do the tasks:
a) Name different forms of the flow of capital.
b) Give the terms defining transnational corporations.
c) Explain the meaning of the terms expressing new forms of TNCs’ participation
in foreign economies.
Ex. 2. Translate the following sentences into English in writing. Make use of the
Vocabulary notes, if necessary.
a) До того как страна достигает точки самоподдерживающегося роста, она
должна привлекать иностранные ресурсы.
b) Ресурсы из богатых стран в бедные приходят в форме иностранной
помощи, частных инвестиций, а также ссуд частных банков. Другим
видом передачи иностранных ресурсов является передача технологий,
идей и знаний.
c) Большую роль в расширении экспорта товаров обрабатывающей
промышленности
из
новых
индустриальных
стран
играют
транснациональные корпорации.
d) Большинство ТНК расположено в развитых странах.
e) Самой крупной страной происхождения ТНК являются США. Они же
являются крупнейшей страной, принимающей прямые иностранные
инвестиции.
f) Все ТНК являются фактически национальными фирмами, которые
расширили свои операции за пределы национальных границ.
g) Число ТНК быстро увеличивается. Наиболее крупные фирмы расширяют
деятельность своих зарубежных филиалов во многих странах.
h) В последнее время появились новые формы участия ТНК в зарубежной
экономике: совместные предприятия, лицензирование, строительство
«под ключ», международные субконтракты и другие договорные
соглашения.
55
Ex. 3.
a) Make up English-Russian pairs choosing the suitable equivalents.
1. linkage; 2. economies of scale; 3. to recycle waste; 4. emergency relief; 5. turnkey operation; 6. foreign concessions; 7. transfer; 8. capital account; 9.
financial assets; 10. a claim for payment.
1. помощь при чрезвычайных обстоятельствах; 2. строительство «под
ключ»; 3. перевод, передача; 4. иностранные концессии; 5. связь; 6.
экономия, возникающая при расширении объёма экономической
деятельности; 7. финансовые активы; 8. платёжная презентация; 9.
перерабатывать отходы; 10. счёт движения капитала.
b) Make up Russian-English pairs.
1. общественный продукт; 2. односторонняя передача средств; 3. счёт
текущих операций; 4. материнская компания; 5. ТНК, базирующаяся в
США; 6. трудоёмкий этап производства; 7. колебания цен на рынке; 8.
активный торговый баланс; 9. принимающая сторона; 10.
лицензирование.
1. parent company; 2. United States-based TNCs; 3. labour intensive production
phase; 4. market fluctuations; 5. a favourable balance of trade; 6. current
account; 7. host country; 8. licensing; 9. social product; 10. unilateral transfer.
Ex. 4. Give English equivalents of the following:
1. внутриотраслевая торговля; 2. внутрифирменная торговля; 3.
внутрифирменное разделения труда; 4. сбалансированный торговый баланс; 5.
платёжный баланс; 6. движение товаров; 7. продажа, сбыт; 8. дочернее
предприятие; 9. уязвимый, незащищённый; 10. ресурсосберегающие
технологии; 11. переступать границы; 12. контракт на управление
производством; 13. расчленение процесса производства; 14. переводить деньги;
15. дебет и кредит.
Ex. 5. Debate on the following topics. Keep the conversation going in a round
table framework.
1. Foreign trade at the end of the 20th century.
2. Trade and integration.
3. Treaties and agreements regulating trade and economic relations.
4. New forms of enslavement of the former colonies.
5. Foreign aid to poor countries.
6. East-West trading relations and their perspectives.
7. Transnational corporations and their role in world trade.
Text II. THE IMF AND THE WORLD BANK
Many people have difficulty distinguishing the IMF form the World Bank. This
difficulty is understandable because these international organizations do have much in
common. Both institutions were created at the Bretton Woods Conference of 1944,
have the same membership, and are concerned with international economic issues. In
56
addition, the two organizations although distinct entities work together in close
cooperation and hold joint annual meetings.
Despite their similarities, the IMF and the World Bank are separate entities.
The IMF, as noted, oversees the international monetary system and promotes
exchange stability and orderly exchange relations among its members. The IMF
assists all members, rich or poor that have balance of payments difficulties. On the
other hand, the World Bank seeks to promote economic development of poorer
countries and is concerned with assisting developing countries through the financial
of specific development projects and programs.
International Bank for Reconstruction and Development
The name “World Bank” encompasses two institutions, the International Bank
for Reconstruction and Development (IBRD) and the International Development
Association (IDA). These institutions should not be confused with EBRD (European
Bank for Reconstruction and Development). The IBRD was established in 1945, but
due to the beginning of the Cold War (the postwar tension between the Soviet Union
and the United States), when it opened in 1946, the USSR did not joint.
The IBRD does not make high-risk loans, and the loans it makes are generally
at market terms. Thus, it cannot achieve its goals as much as it might hope. The IDA
was created in 1960 to bridge this gap between IBRD objectives and reality. The IDA
makes loans to poor countries with average per capita GNP of less than $410 on more
favorable terms than the IBRD. (To put this into perspective, the United Arab
Emirates has a per capita GNP of $30,000). Loans can be made only to governments,
however, which stifle some private initiatives. The IDA and IBRD share staffs.
A separate entity, the International Finance Corporation (IFC), was created in
1965 to address the issue of loans to private enterprises in developing countries. The
IFC works jointly with commercial banks and also advises countries on developing
capital markets. The IFC does not have the backing of a governmental guarantee
when it borrows.
CASE STUDY
Bank Operations
Background information
Everything in economy is controlled by money and the bank is the most
important link in the world of money controlling money circulation between firms,
depositors and loaners, and offering services to make this circulation easier for them.
The Ukrainian foreign exchange system is regulated by the decree of the
Cabinet of Ministers “On the System of Foreign Exchange Control”. The National
Bank of Ukraine together with the Cabinet of Ministers is responsible for
implementing foreign currency exchange policy. It has the authority to issue licenses
for currency operations.
The NBU issued a resolution canceling the restrictions on banking transactions,
which non-balance branches of commercial bank can effectuate. The NBU also
allowed banks to open branches in any oblast.
57
Problem
The “Prominvest Bank” plans to extend services and to open new branches. It
has organized an informal meeting of subsidiary bank managers to brainstorm the
opportunity of performing additional bank services.
Task
You are representative of the managing staff of the “Prominvest Bank”. Work in
groups of 3 or 4 persons and brainstorm the points listed in the rough notes. Then
meet as one group and select best suggestions for further study.
Brainstorming session
1. What traditional bank services are to be done?
2. What nonspecific services can be operated by the bank?
3. Where will you open a new branch?
4. How will you perform transactions?
5. What juridical help will you use?
6. How will you present the clients’ interests in the court?
7. Will you deal with information services? How?
8. Will you extend tourist services? How?
9. Will you accept “utilities” payment?
10.Will you accept proceed of enterprises?
11.Will you trade in banking metals and cash currency?
12.Will you sell lottery tickets?
13.At what expense will you open a charity fund?
14.What privileges for agricultural companies will you introduce?
Text III. THE GOLD STANDARD
The gold standard had its origin in the use of gold coins as a medium of
exchange, unit of account, and store of value – a practice that stretches back to
ancient times. In the days when international trade was limited in volume, payment
for goods purchased from another country was typically made in gold or silver.
However, as the volume of international trade expended in the wake of the industrial
revolution, a more convenient means of financing international trade was needed.
Shipping large quantities of gold and silver around the world to finance international
trade seems impractical. The solution was to arrange for payment in paper currency
and for governments to agree to convert the paper currency into gold on demand at a
fixed rate.
The gold standard worker reasonably well from the 1870s until the start of
World War I in 1914, when it was abandoned. During the war several governments
financed part of their massive military expenditures by printing money. This resulted
in inflation, and by the war’s end 1918, price levels were higher everywhere. The
United States returned to the gold standard in 1919, Great Britain in 1925, and France
in 1928.
Great Britain returned to the gold standard by pegging the pound to gold at the
prewar gold parity level of $4.25 per ounce, despite substantial inflation between
58
1914 and 1925. This priced British goods out of foreign markets, which pushed the
country into a deep depression. When foreign holders of pounds lost confidence in
Great Britain’s commitment to maintaining its currency’s value, they began
converting their holdings of pounds into gold. The British government saw that it
could not satisfy the demand for gold without seriously depleting its gold reserves, so
it suspended convertibility in 1931.
The United States followed suit and left the gold standard in 1933 but returned
to it in 1934, raising the dollar price of gold from $20.67 per ounce to $35 per ounce.
Since more dollars were needed to buy an ounce of gold than before, the implication
was than the dollar was worthless. By reducing the price of U.S. exports and
increasing the price of U.S. imports, the government was trying to create employment
in the United States by boosting output. However, a number of other countries
adopted a similar tactic, and in the cycle of competitive devaluations that soon
emerged, no country could win.
This put pressure on the gold reserves of various countries, forcing them to
suspend gold convertibility. As a result, by the start of World War II in 1939, the gold
standard was dead.
Vocabulary notes
medium – средство
store – накопление
to peg – штучно поддерживать цену
to abandon – отказываться
holder – собственник
to lose confidence – терять доверие
commitment – намерение
1.
2.
3.
4.
5.
6.
7.
8.
to satisfy the demand – удовлетворить
спрос
to deplete – исчерпать
to follow suit – подражать примеру
to boost output – увеличить производство
to emerge – появляться
to suspend – приостановить
Comprehension and Discussion Questions
How did countries purchase goods in ancient times?
Was it possible to exchange paper currency?
Is hryvnia a convertible currency?
What was used as a medium of exchange in foreign trade in ancient time?
When was the gold standard adopted?
When did it work well?
When was the gold standard abandoned?
Why did countries suspend gold convertibility?
Text IV. THE DOLLAR PURCHASING POWER
The purchasing power of the dollar is calculated by the Bureau of Labor
Statistics (BLS), the American government agency that collects data on the cost of
living. One of the best know of the data compiled by the BLS is the consumer price
index or CPI. The CPI compares the average 1 prices of variety of commonly
purchased goods and services in one year to the prices of similar goods in base year.
Every month, the BLS records the prices of approximately 1,000 items. These are the
59
goods and services normally consumed by urban families. The prices are collected in
85 areas across the country from over 57, 000 households and 19,000 business firms.
An index number is a number that shows percentage change from some base,
which is usually made equal to 100. Thus, a CPI number of 167 would indicate that
consumer prices had increased by 67 percent since 1982-84 (the base years).
Similarly, a CPI number of 82 would indicate a decrease of 18 percent. In calculating
the index, each item 13 is assigned a weight to account for 14 its relative importance
in consumers’ budgets. For example, if in a given month, the price of milk is US$1
per quart, and the average household consumes 15 quarts of milk per month, then the
cost of milk for month would be carried as US$15. Similarly, if the price of men’s
shoes averaged US$78 that month, and the average household purchased two pairs of
men’s shoes per year, then the cost of shoes would be entered as US$13.
Purchasing power is calculated by dividing 100 by the index number for the
particular year. For example, if the CPI in a given year was 85, the purchasing power
of the American dollar would be expressed as US$1.18. In practical terms, the CPI
shows how much money you need today to buy the goods and services you could get
for US$100 during the base year.
A price index can be constructed for a variety of purposes, such as for
consumer prices, producer prices, stock prices, etc. Using the following formula
Price Index = Price in the given year/ Price in a base year * 100, you can
calculate any product price.
Vocabulary notes
average price – средняя цена
urban families – семья, которая проживает
в городе
item – название товара
to account for – чтобы определить
1.
2.
3.
4.
stock price – цены на бирже
percentage – средний
purchasing power – покупательская
способность
Comprehension and Discussion Questions
Who calculates the purchasing power of the dollar?
How is purchasing power of the dollar calculated?
Are consumers’ budgets important to know for calculating price index?
Why do they construct a price index?
60
UNIT VII
Text I. MONEY AND ITS FUNCTION
All values in the economic system are measured in terms of money. Our goods
and services are sold for money, and that money is in turn exchanged for other goods
and services. Coins are adequate for small transactions, while paper notes are used for
general business. There is additionally a wider sense of the “money”, covering
anything which is used as a means of exchange, whatever form it may take.
Originally, a valuable metal (gold, silver or copper) served as a constant store of
value, and even today the American dollar is technically “backed” by the store of gold
which the US government maintains. Because gold has been universally regarded as a
very valuable metal, national currencies were for many years judged in terms of socalled “gold standard”.
Nowadays however valuable metal has generally been replaced by paper notes.
National currencies are considered to be as strong as the national economies which
support them. Paper notes are issued by governments and authorized banks, and are
known as “legal tender”. Other arrangements such as cheques and money orders are
not legal tender. They perform the function of substitute money and are known as
“instruments of credit”. Credit is offered only when creditors believe that they have a
good chance of obtaining legal tender when they present such instruments at a bank
or authorized institution. If a man’s assets are known to be considerable, then his
credit will be good. If his assets are in doubt, then it may be difficult for him to obtain
large sums of credit or even to pay for goods with a cheque.
The value of money is basically its value as a medium of exchange, or, as
economists put it, its “purchasing power”. This purchasing power is dependent on
supply and demand. The demand for money is reckonable as the quantity needed to
effect business transactions. An increase in business requires an increase in the
amount of money coming into general circulation. But the demand for money is
related not only to the quantity of business, but also to the rapidity with which the
business is done. The supply of money, on the other hand, is the actual amount in
notes and coins available for business purposes. If too much money is available, its
value decreases, and it does not buy as much as it did, say, five years earlier. This
condition is known as “inflation”.
Vocabulary notes
value – ценность
transaction - дело, сделка, операция
a means of exchange – средство обмена
a store of value – средство сохранения
стоимости, средство сбережения
a constant store of value – постоянное
накопления стоимости
to back (paper money, currency) –
поддерживать, обеспечивать (бумажные
деньги, валюту)
store – запас
the store of gold – золотой запас
currency – 1. деньги, 2. валюта
national currency – национальная валюта
the gold standard – золотой стандарт
to abandon the gold standard – отказаться
от золотого стандарта
to issue – выпускать, пускать в обращение
to issue paper notes – выпускать бумажные
деньги
authorized – официально принятый,
разрешенный, санкционированный
61
authorized banks – банки, наделённые
определёнными правами, уполномоченные
банки
legal tender – законное платёжное
средство,
официально
принято
государством (банкноты)
cheque – чек
а money order – платёжное поручение
substitute
money
–
представитель
платёжных средств
instruments of credit – кредитные
обязательства (векселя, чеки, облигации)
assets – 1. активы, 2. средства, капитал
the value of money – стоимость денег
a medium of exchange – 1. средство
обмена, расчёта, 2. средство обращения
(как функция денег)
1.
2.
3.
4.
5.
6.
7.
8.
purchasing power – покупательская
способность
to reckon – подсчитывать, исчислять
reckonable - исчисляемый
circulation – обращение
comе into general circulation – поступать в
совокупное обращение
the demand for money – спрос на деньги
the supply of money – 1. денежная масса
(сумма денег в обращении), количество
денег, 2. предложение денег
the quantity of business – количество
операций, объём бизнеса
the rapidity of business – скорость
осуществления операций в бизнесе
available – имеющийся в наличии
Comprehension and Discussion Questions
What is the role of money and what are its functions?
What is the gold standard and why was it abandoned? What backs national
currencies now?
Why do you think valuable metal has been replaced by paper money? Who can
issue paper notes?
What are money orders and what function do they perform?
In what case can one obtain large sums of credit and even pay for goods with a
cheque?
What is purchasing power and what does it depended on?
How do we reckon the demand for money? What is the demand for money
related to?
What is inflation?
Ex. 1. Read the text and do the tasks:
a) Give the wider sense of the word “money”.
b) Pick out derivatives and word combinations with the word “value”.
Translate them into Russian and use them in sentences of your own.
c) Find in the text all the terms which you would use speaking about
money.
Ex. 2. Translate the following sentences into English in writing. Make use of the
Vocabulary notes, if necessary.
a) Все ценности в экономической системе измеряются деньгами. Товары
и услуги продаются за деньги, а эти деньги обмениваются на другие
товары и услуги. Термин «деньги» в широком смысле этого слова
означает всё, что используется как средство обмена.
b) Первоначально ценный метал служит как постоянное накопление
стоимости. Даже сегодня американский доллар «поддерживается»
62
c)
d)
e)
f)
запасом золота. Многие годы национальные валюты оценивались с
точки зрения «золотого стандарта».
В настоящее время бумажные деньги заменили металл, и сила
национальных валют оценивается силой национальной экономики,
которая поддерживает их. Бумажные деньги, выпущенные
эмиссионными банками, являются законным платежным средством.
Чеки и платежные поручения не являются государственным
платёжным средством. Они выполняют функцию представителя
платёжных средств и известны как кредитные обязательства.
Стоимость денег определяется их стоимостью как средства обмена или
их покупательной способностью. Эта покупательская способность
зависит от соотношения спроса и предложения.
Если в обращении слишком много денег, их стоимость снижается и
падает покупательская способность. Эта ситуация известна как
инфляция.
Text II. INTERNATIONAL MONETARY SYSTEM
In 1994, at the height of World War II, representatives from 44 countries met at
Bretton Woods, New Hampshire, to design a new international monetary system.
With the collapse of the gold standard and the Great Depression of the 1930s fresh in
their minds, these statesmen were determined to build an enduring economic order
that would facilitate post war economic growth. There was general consensus that
fixed exchange rate were desirable. In addition the conference participants wanted to
avoid the senseless competitive devaluations of the 1930s, and they recognized that
gold standard would not assure this. The major problem with the gold standard as
previously constituted was that there was no multinational institution that could stop
countries from engaging in competitive devaluations.
The agreement reached at Bretton Woods established two multinational
institutions-the International Monetary Fund (IMF) and the World Bank. The task of
the IMF would be to maintain order in the international monetary system, and that of
the World Bank would be to promote general economic development. The Bretton
Woods agreement also called for a system of fixed exchange rates that would be
currency in terms of gold but were not required to exchange their currencies for gold.
The fixed exchange rate system collapse in 1973, primarily due to speculative
pressure on the dollar following a rise in U.S. inflation and a growing U.S. balanceof-trade deficit.
Since 1973 the world has operate with a floating exchange rate regime and
exchange rates have become more volatile and far less predictable. Volatile exchange
rate movements have helped reopen the debate over the merits of fixed and floating
systems.
The collapse of the Bretton Woods system left the IMF and World Bank with
diminished roles in the international monetary system. In response, both the IMF and
the World Bank have developed into global macroeconomic police. Today they lend
63
money to countries with balance-of-payments, debt, or development problems,
extracting promises to adopt specific macroeconomic policies as a condition.
One function of the foreign exchange market is to convert the currency of one
country into the currency of another.
International business participate in the foreign exchange market to facilitate
international trade and investment, to invest spare cash in short-term money market
accounts abroad, and to engage in currency speculation.
A second function of the foreign exchange market is to provide insurance
against foreign exchange risk.
Foreign exchange risk can be reduced by using forward exchange rates. A
forward exchange rate is an exchange rate governing future transactions.
The most common approach to exchange rate forecasting is fundamental
analysis. This relies on variables such as money supply growth, inflation rates,
nominal interest rates, and balance of payments positions to predict future changed in
exchange rates.
In many countries, the ability of residents and nonresidents to convert local
currency into a foreign currency is restricted by government policy. A government
restricts the convertibility of its currency in attempting to protect the country’s
foreign exchange reserves and to halt capital flight.
Vocabulary notes
collapse - падение
enduring economic order – терпимый
экономический порядок
to avoid devaluation – избегать
обесценивания
to provide insurance – обеспечивать
застрахован ость
transaction – ведение (дела)
balance of payment – платёжный баланс
to restrict – ограничивать
balance-of-trade deficit - дефицит
торгового баланса
1.
2.
3.
4.
5.
6.
7.
8.
9.
floating exchange rate – плавающий
(нестабильный) курс валюты
to diminish – уменьшать
to attract – привлекать
to attempt – стараться, пытаться
exchange market – валютный рынок
to facilitate trade – содействовать
развитию торговли
money market account – денежный учёт
money account – денежный счёт
to be engaged – заниматься
convertibility – конвертированость
Comprehension and Discussion Questions
When did the gold standard die?
When was the International Monetary Fund founded?
What was the task of the IMF?
Why did the fixed exchange rate collapse?
What exchange rate system does the world operate with?
What are the functions of the foreign exchange market?
Can foreign exchange rate be reduced?
Why does a government restrict the convertibility of its currency?
Does exchange rate influence the profitability of foreign trade?
64
WORD STUDY
Ex. 1. Match a word in A with its synonym in B.
A
B
1. to take part
a) to forecast
2. to facilitate
b) benefit
3. risk
c) to participate
4. to predict
d) reply
5. to restrict
e) to set up
6. to attempt
f) venture
7. to protect
g) to limit
8. to establish
h) to try
9. profit
i) to promote
10. response
j) to defend
Ex. 2. Find logical links: which noun in B can go with the verb in A?
A
B
1. to convert
a) development
2. to predict
b) money
3. to restrict
c) business
4. to reach
d) changes
5. to maintain
e) currency
6. to promote
f) agreement
7. to lend
g) order
8. to fix
h) convertibility
9. to launch
i) exchange rate
Ex. 3. List “A” contains some basic terms in the field of business. Choose a term
to fit each definition in list “B”.
List A 1. management
2. insurance
3. balance of trade
4. inflation
5. risk
6. macroeconomic
List B
a. __________ the study of the economy as a whole.
b. __________ the possibility of profit or loss depending on the success or failure.
c. __________ the organization and coordination of an enterprise.
d. __________ the difference between the export and import.
e. __________ the period of rising prices during which the purchasing power of the
dollar is falling.
f. __________ the protection against financial loss by sharing risk with other.
65
Ex. 4. Match the Russian terms with their English equivalents.
A
1. отношения между
2. оказывать финансовую
помощь
3. экономическое увеличение
4. кредитование
5. налоговая политика
6. администрирование
7. государственные расходы
8. баланс платежей
9. надсмотр за банковскими
операциями
10. управление банками
11. учёт банковских операций
12. регулирующая политика
13. предпринимательство
B
a) tax policy
b) entrepreneurship
c) central bank accounting
d) public expenditure
e) administration
f) relationship between
g) economic growth
h) regulatory policy
i) bank supervision
j) to provide financial support
k) lending money
l) bank supervision management
m) balance of payment
Ex. 5. Translate the sentences into English using the key-terms given in Ex. 4.
1. Отношения между странами и частными секторами на макроуровне – это
задачи Международного валютного фонда.
2. МВФ даёт финансовую поддержку относительно того, как Украина
внедряет политику, направленную на рост экономики.
3. МВФ, кроме объемных кредитов, предоставлял техническую помощь по
таким основным направлениям:
- налоговая политика и администрирование;
- управление государственными расходами;
- надсмотр за операциями центральных и коммерческих банков;
- экономическая и финансовая статистика.
4. За последние 10 лет система МВФ научила более 100 украинских
чиновников по финансовому программированию и политике,
методологии составления баланса платежей, внешней политике и другим
вопросам.
5. Приблизительно 150 специалистов посетили курсы и семинары по анализу
макроэкономики и политике управления государственными расходами, по
учёту банковских операций и менеджменту фискальной политики.
6. Международная финансовая корпорация даёт советы правительству, как
улучшить общий предпринимательский климат.
7. Кабинет министров, министерства, Администрация президента,
Государственный
комитет
по
регулирующей
политики
и
предпринимательству сотрудничали по проекту МФК.
66
Grammar
Conditionals
I.
First conditional sentences (clauses) are based on the fact in real time and
they express a possible condition in the present or future.
If you come, we’ll go for a walk.
Если ты придешь, мы пойдём на прогулку.
If supply increases, the price will decrease.
Если предложение будет увеличиваться, цена будет уменьшаться.
This rule applies also to the subordinate clauses of time introduced by when.
II.
Second conditional sentences (clauses) are not based on the fact. They
express the situation, which is contrary to reality in the present and future.
If I were you, I’d (would) sign this contract.
Если б я был на вашем месте, я бы подписал этот контракт (ещё
возможно его подписать).
III. Third conditional sentences (clauses) are not based on the fact. They
express the situation, which is contrary to reality in the past.
If they had given us a good discount, we would have signed that contract.
Если бы они сделали скидки, мы бы подписали тот контракт (не
реализованное условие).
The Use of Tenses in the Conditional Sentences
Subordinate clause
Principal clause (главное
(придаточное предложение) предложение)
Present Indefinite (simple)
Future Indefinite (simple)
Conditional I
Past Indefinite (simple)
(should) would +Infinitive
Conditional II
Past Perfect
(should) would + Perfect
Conditional III
Infinitive
The Past Indefinite (simple) is used in the second conditional and with wish, if
only, would rather and it’s time to express unreal Present and Future.
The Past Perfect is used in the third conditional and with wish, if only, would
rather to express unreal Past.
I wish you were in my place.
Хотелось, чтоб ты был на моём месте.
If only you stopped smoking!
Если б ты только перестал курить!
If only you would have done it before.
Если б ты сделал это раньше.
Ex.6. Translate these sentences into Russian and mark the type of the clause as:
Cond. I
Cond. II
Cond. III
Model: If I were you, I’d (would) not buy it. (Cond. II) – Я (на твоём месте) этого
не купил бы.
1. If you come today, I’ll pay you.
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2.
3.
4.
5.
6.
7.
8.
9.
If you had a lot of money, what would you buy?
I wish I had studied English at school.
If this lesson doesn’t end soon, I’ll fall asleep.
If I’d had more time, I’d have finished my report.
If only I didn’t have to go there.
The payment will be done in time if we receive your order.
The order is not valid for export if it is not done in due time.
If we had attracted foreign investments earlier, we would have had better
results.
10.If you didn’t pay the tax, you would be fined.
11.If am authorizes to sign this paper, I’ll do it with pleasure.
Ex. 7. Translate the following sentences into English paying attention to the use
of the Conditionals.
1. Если бы мы раньше приняли этот закон, бизнес развивался б лучше.
2. Если бы налог на добавленную стоимость не сковывал бизнес.
3. Если бы я был президентом, я бы отклонил законопроект о
налогообложение доходов бедных слоёв населения.
4. Если мы пересмотрим положение контракта, мы сможем расширить
заказы.
5. Если цена на хлеб упадёт, производство мяса увеличится.
6. Если бы мы умели экономить, мы бы жили лучше.
7. Хотелось, чтобы ты помог мне.
8. Лучше б я купил компьютер, а не музыкальный центр.
9. Если б не было проблем, мы бы смогли поехать на конференцию.
10.Если б у нас были возможности, мы бы провели прошлые каникулы
лучше.
Text III. BANKING
Banks are closely concerned with the flow of money into and out of the
economy. They often co-operate with governments in efforts to stabilize economies
and to prevent inflation. They are specialists in the business of providing capital, and
in allocating funds on credit. Banks originated as places to which people took their
valuables for safe-keeping, but today the great banks of the world have many function
in addition to acting as guardians of valuable private possession.
Banks normally receive money from their customers in two distinct forms: on
current account, and on deposit account. With a current account, a customer can issue
personal cheques. No interest is paid by the bank on this type of account. With a
deposit account, however, the customer undertakes to leave his money in the bank for
a minimum specified period of time. Interest is paid on this money.
The bank in turn lends the deposited money to customers who need capital.
This activity earns interest for the bank, and this interest is almost always at a higher
rate than any interest which the bank pays to its depositors. In this way the bank
makes its main profits.
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We can say that the primary function of a bank today is to act as an
intermediary between depositors who wish to make interest on their savings, and
borrowers who wish to obtain capital. The bank is a reservoir of loanable money, with
streams of money flowing in and out. For this reason, economists and financiers often
talk of money being “liquid”, or of the “liquidity” of money. Many small sums which
might not otherwise be used as capital are rendered useful simply because the bank
acts as a reservoir.
The system of banking rests upon a basis of trust. Innumerable acts of trust
build up the system of which bankers, depositors and borrowers are part. They all
agree to behave in certain predictable ways in relation to each other, in relation to the
rapid fluctuations of credit and debit. Consequently, business can be done and
cheques can be written without any legal tender visibly changing hands.
Vocabulary notes
the flow of money – движение, поток денег
to provide capital – обеспечить капитал
to allocate – 1. ассигновывать, 2.
распределять, размещать
safe-keeping – хранение ценностей в
(банковском) сейфе
guardian – опекун
possession – имущество, собственность
account – счёт
current account – текущий банковский
счёт (не сберегательный)
deposit account – депозитный счёт, англ.
срочный вклад
to issue a cheque – выписать чек
to pay interest – выплачивать процент
to lend money – давать деньги в займы
deposited money – деньги на счетах
вкладчиков
to earn interest – приносить доход
depositor – вкладчик
1.
2.
3.
4.
5.
6.
intermediary [intə'm:djəri] – посредник
to act as an intermediary for smb. – быть
посредником для кого-то
savings pl. – сбережения, накопления
to make interest on one’s savings –
получать процент на свои сбережения,
получать
доход
на
собственные
сбережения
borrower – заёмщик
reservoir
['rezevwa:]
–
резервуар,
хранилище
to loan – ссужать, давать взаймы
loanable money – ссужаемые деньги
streams of money – денежные потоки
liquid – ликвидный, быстро реализуемый
liquidity – ликвидность
to render useful – делать полезным
trust
–
траст,
доверительные
имущественные отношения
credit and debit – расход и приход (доход)
Comprehension and Discussion Questions
What are banks closely concerned with and what was their original function?
In what way do banks cooperate with governments?
How do banks function now and what is their primary function?
How does the bank make its main profit?
What is the liquidity of money?
What is trust for the banking system?
Ex. 1. Read the text and do the tasks:
a) Find in the text the terms which are used to describe the operations of the bank.
b) Pick out from the text set expression with the word “interest”. Translate them
into Russian and use them in sentences of your own.
69
c) Give the word combinations with the word “account” used in the text and
explain their meanings. What other meanings of this word do you know?
Ex. 2. Translate the following sentences into English in writing. Make use of the
Vocabulary notes, if necessary.
a) Банки связаны с потоком денег, поступающих в экономику и изымаемых
из неё. Банки получают деньги от своих вкладчиков в двух формах: на
текущие счета и на депозитные.
b) Банк выплачивает проценты по депозитным счетам, когда клиент
оставляет свои деньги в банке на определённый период времени.
c) Если банк ссужает деньги, то эта операция приносит банку доход в виде
процента. Норма этого процента всегда выше, чем те проценты, которые
банк платит своим вкладчикам.
d) Сегодня главной функцией банка является посредничество между
вкладчиками и заёмщиками. Банк служит резервуаром ссудных денег с
входящими и выходящими из него денежными потоками.
e) Банковская система основывается на доверительных имущественных
отношениях. Многочисленные трастовые акты создают систему, частью
которой являются банкиры, вкладчики и заёмщики.
Text IV. RETAIL BANKING ON THE INTERNET
Internet banking is still in its infancy. Although most of the top 100 banks in
the U.S. have a Web site, the Online Banking Report classifies 24 of them as “true
Internet Banks” – banks that let their customers review balances, transfer funds and
pay bills on their Web sites. Smaller banks also have Web presences. In Online
Banking’s list of 133 “True Internet Banks,” 109 do not make the list of the top 100
U.S. banks ranked by assets.
Before the decade is out, customers are likely to be able to do most of their
banking transactions on the Web. According to a 1996 Booz-Allen & Hamilton
survey of North American Financial institutions with Web sites, 80 percent of
respondents planned to allow their customers to conduct most traditional banking
transactions over the Internet within three years.
On-line retail banking is being driven by lower operating costs, the ability to
offer new services, and the ability to do one-to-one marketing
Lower Operating Costs. On-line banking services are less expensive to offer
to customers than other forms of banking. Checking an account balance or
transferring funds form a checking account to a savings account can be done in
person at a branch bank, over the telephone, with an Automatic Teller Machine
(ATM), at home using a PC, or, in some cases, on a bank’s Web site.
A branch bank can serve as many customers as it has staff to handle. Once the
investment is made to create a fully functioning Internet site (for a large bank, the
initial investment could be millions of thousands of dollars), the bank’s Web site can
handle one customer inquiry or tens of thousands a day.
70
Booz-Allen & Hamilton estimates that it costs about a penny to conduct a
banking transaction using the Internet and more than one dollar if handle by a teller at
a branch bank.
New Services. Today’s on-line banking allows customers to check account
balances, transfer funds, and update customer information – transactions that can
already be performed through traditional banking channels. For some banking from
home or the office is preferable to calling the bank’s automated phone service or
going to a branch bank. Others do not find the services offered on-line today reason
enough to change their banking habits.
In the future, analysts expect that Internet banking will be enhanced with new
services that make on-line banking easier and more convenient that banking by ATM,
by phone, or visiting the branch bank. Paying bills electronically is one such example.
Checks are the preferred method of bill payment in United States. For a
business, preparing and sending paper bills can be costly. For a consumer, paying
bills by check can take a great deal of time. Billers print out and mail the bills to a
consumer’s home. The consumer writes a check, records the check number and
amount paid, balances the checkbook, finds a stamp, and mails the check back to the
biller. The biller receives the check, updates his accounts, and sends the check to the
bank to credit to his account. Handling paper bills and checks can cost a biller
between $1,65 and $2,70 each time he sends out a bill. It costs the customer time and
the price of a stamp to pay each bill.
Today’s Internet-based bill payment services take some of the paperwork out of
the process. Rather than writing a paper check and mailing it to the vendor, a
customer authorizes his bank to pay bills on his behalf. This saves the customer some
time, and may save the vendor some money, if all steps are completed electronically.
However, vendors still incur the costs of mailing the bill to the customer. And,
smaller vendors without an electronic connection still have a series of manual and
paper-based steps to complete.
Some banks believe that future Web-based bill payment services can make the
entire process paperless. The vendor will send an electronic image of the bill to the
customer’s bank. The customer will electronically authorize the bank to pay the bill,
the bank will debit the customer’s account, and the vendor will receive payment
electronically. The vendor’s printing and mailing costs are eliminated, and processing
costs are greatly reduced. The customer enjoys the convenience of paying bills
without having to keep stamps and envelopes on hand. With services that
automatically update account balances, the customer also saves time he formerly
spent balancing his checkbook.
Vocabulary notes
retail banking – розничные услуги банка
infancy – младенчество, начало пути
true bank – настоящий, надёжный банк
to review – обозревать, знакомится
to rank – занимать место, котироваться
to survey – обследовать
a teller – счётчик
expensive – дорогой
savings – сбережения
preferable – предпочтительный
to transfer funds – переводить фонды
to enhance – увеличивать
to update – обновить в соответствии с
требованиями
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1.
2.
3.
4.
5.
6.
7.
Comprehension and Discussion Questions
Can you positively estimate on-line retail banking on the Internet?
Which is more effective on-line or traditional banking?
Is an on-line banking transaction expensive?
Which type of banking transaction do you use?
What are the services of on-line banking?
What new technologies do we expect to come in future?
Can you compare the method of bill payment with the Internet based bill
payment?
Practical Task:
Read through text IV and make up a short summary of it using topical
sentences of paragraphs for the purpose.
Text V. LONDON’S ROLE AS A FINANCIAL CENTRE
He’s merchant-bank Bertie, who sets off at 6.30, and a dapper, well-heeled
fellow he is, to be sure. Yet he crowds, with thousands of others, into a shabby train
or bus headed for the City of London. They will all swarm through damp, grimy
streets to their skyscrapers to do what? To cluster in some of the world’s most
expensive office space, to stare at flickering screens and pore over pages of numbers,
and to talk on the telephone to other disembodied voice about this deal and that price.
Bertie’s business has its ups and downs, but why does he do it in London?
Much the same can be asked about New York and Tokyo, the other financial centres,
now that computers, satellites and an end to capital controls have made money
mobile. Yet only London is worrying about its future as a financial capital.
London is right to worry. Of the three main financial centres, its position is the
most fragile. In New York and Tokyo a small amount of international finance is
perched on a vast domestic market. In London, it is the other way around. The
businesses it attracted in the past 30 years could as easily be done in New York,
Tokyo or elsewhere.
In five short years, Tokyo has managed to wrest leadership of international
bank-lending away from London. And then there is continental Europe, where Paris
and Frankfurt are on the up. For the first time in centuries, London has rivals in
continental Europe.
Its easiest defence starts with the earth’s rotation. Yes, some international
business might revert to America or Japan, but until the world’s Berties give up both
sleep and dinner, there will be trading and other deals in the European time zone. For
that business, London’s rivals are still far behind. But this begs another question.
Why have a centre at all?
Communication is now cheap and reliable, making it easy to trade, borrow and
invest from the warmth of southern France or the cheapness of Glasgow. Businesses
in which people have to see the whites of each other’s eyes – such as mergers advice
– might have to stay in finances inner cities. Others do not.
72
Vocabulary notes
a dapper – щеголь
shabby – поношенный жалкий
to swarm – толпится
to cluster – собраться группами
to flicker – мерцать, мигать
to pore over – сосредоточенно изучать
disembodied – чужой, неодушевлённый
fragile – неустойчивый
1.
2.
3.
4.
5.
6.
7.
to perch – оседать
elsewhere – в других местах
to wrest – вывести, вытянуть
to revert - возвращаться
rivals – соперники
to give up – бросить, отказаться
reliable – надёжный
cheapness – дешевизна
Comprehension and Discussion Questions
Are the main customers of merchant banks private individuals?
Does the writer show approval of how people such as Bertie work?
If something such as a business has its ups and downs, is it, on the whole, OK?
Why is the earth’s rotation important?
“International business might revert to America or Japan” means that it might
a) go there, or
b) return there?
If a statement begs a question, has the question already been answered?
Why do people need to see the whites of each other’s eyes when discussing
mergers?
Text VI. CASE STUDY
Assume that farmer Mr. Brown needs $6,000 to buy seed and fertilizer and to
pay wages to laborers he must hire to work his farm. Assume further that he does not
have the cash he needs, so he goes to the only bank in his community to borrow
funds.
The bank loan officer tells Mr. Brown that if he wants a loan, he must put up
collateral – property that is pledged by a borrower to protect the lender’s investments.
Mr. Brown has equipment valued at $ 10,000, so he pledged this as collateral for a $
6,000 loan. To protect itself, a bank generally requires collateral in excess of the
amount borrowed. If the loan is for 1 year, Mr. Brown signs a note payable to the
bank stating that he will repay the $6,000 plus 12 percent interest ($720) at the end of
the year.
If the bank were to give Mr. Brown $6,000 in currency, he could easily buy the
goods and services needed since people would accept the currency without question.
But if it were to do so, the bank would restrict its own ability to make loans and thus
to make profit in the form of interest income. Suppose that the bank has $100,000 in
cash reserves. If it lends all this money at 12 percent interest, it will make only $
12,000 per year in interest. This limitation led banks to search for a more profitable
method of lending money.
If Mr. Brown comes to the bank today to borrow $6,000, the bank, instead of
giving him the loan in the form of cash, will grant the loan by creating a derivative
deposit for him. Mr. Brown then writes checks against the created checkable deposit.
These checks, which are drafts against the bank to pay the bearer a stimulated
73
amount, serve as money. People usually accept them in good faith in exchange for
goods and services. Thus, the money supply increases to the extent of checkable
deposits created. Since the bank does not lend currency, it might seem able to make
an unlimited number of loans in the form of checkable deposits. However, it has to
keep sufficient cash on hand to provide for those who want to redeem the checks.
Vocabulary notes
collateral [kə'lætərəl] – обеспечение
краткосрочного долга
to put up collateral – обеспечить залог
to pledge – закладывать, отдавать в залог
lender – кредитор, заимодатель
loan – заём, ссуда
to sign a note payable to the bank –
подписать банку вексель к оплате
cash reserves – резерв наличных денег
1.
2.
3.
4.
5.
derivative deposit – производный депозит
(образованный за счёт кредита)
checkable deposit – чековый депозит
draft – переводной (на банк) вексель
bearer – предъявитель
a stimulated amount – обусловленная
(оговоренная) сумма
to redeem – погашать, выкупать,
выплачивать
Comprehension and Discussion Questions
What is the usual procedure in the bank for making a loan? How does the bank
protect itself? What is collateral?
Why doesn’t the bank give loans in currency? What would happen if it did?
What is more profitable method of lending money?
How does a derivative checkable deposit increase the money supply, whereas a
primary deposit does not?
Why does the bank have to keep sufficient cash on hand?
Ex. 1. Read the text and do the tasks:
a) Give synonyms of the word “loan”. Use them in sentences of your own.
b) Pick out the terms which are used in the text for describing the usual procedure
of the bank when granting a loan.
c) Explain the difference between “to create money” and “to make money”.
Illustrate that with your examples.
Ex. 2. Translate the following sentences into English in writing. Make use of the
Vocabulary notes, if necessary.
a) Если вы хотите получить банковскую ссуду, то вы должны обеспечить
залог – собственность, которая закладывается заёмщиком, чтобы
обеспечить инвестиции кредитора. Защищая себя от риска, банк обычно
требует залог больший, чем величина займа
b) Если ссуда берётся на один год, заёмщик выдаёт банку вексель, в котором
обязуется выплатить к концу года всю сумму плюс проценты на эту
сумму.
c) Вместо предоставления заёмщику ссуды в форме наличных денег, банк
открывает ему чековый депозит. Эти чеки обменивает предъявителю на
официальную валюту. Обычно люди принимают чеки в обмен на товары
74
и услуги. Таким образом, предложение денег увеличивается на объём
денежной массы, создаваемой чековым обращением.
Ex. 3.
c) Make up English-Russian pairs choosing the suitable equivalents.
1. legal tender; 2. bearer; 3. draft; 4. pledge; 5. reservoir; 6. debit and credit; 7.
reckon; 8. gold standard; 9. store of value; 10. money order.
1. переводной вексель; 2. резервуар; 3. расход и приход; 4. подсчитывать,
исчислять; 5. золотой стандарт; 6. предъявитель; 7. средство сбережения;
8. законное платёжное средство;
9. платёжное поручение; 10.
закладывать, сдавать в залог.
d) Make up Russian-English pairs.
1. активы; 2. распределять, размещать средства; 3. хранение ценностей; 4.
опекун; 5. посредник; 6. движение денег; 7. выпускать деньги; 8.
обусловленная сумма; 9. ценность; 10. ликвидность.
1. safe-keeping; 2. intermediary; 3. the flow of money; 4. to issue money; 5. a
stipulated amount; 6. to allocate; 7. value; 8. liquidity; 9. assets; 10. guardian.
Ex. 4. Give English equivalents of the following:
1. средство обмена; 2. сделка, операция; 3. отказаться от золотого стандарта; 4.
средство расчёта; 5. обращение денег; 6. денежная масса; 7. выпускать деньги;
8. текущий счёт; 9. срочный счёт; 10. дать заём под 12 процентов; 11. вкладчик;
12. сбережения; 13. залог; 14. ссужаемые деньги; 15. получать доход.
75
UNIT VIII
Text I. ACCOUNTING INFORMATION AND THE CAPITAL FLOWS
Accounting has often been referred to as “the language of business”. This
language finds expression in profit and loss statements, balance sheets, budgets,
investment analysis, and tax financial position to the providers of capital: investors,
creditors, and government. It enables the providers of capital to assess the value of
their investments, or the security of their loans, and to make decisions about future
resource allocations. Accounting information is also the means by which firms report
their income to the government, so the government can assess how much tax the firm
owes. It is the means by which the firm can evaluate its performance, control its
internal expenditures, and for future expenditures and income. Thus, it is no
exaggeration to say that a good accounting function is critical to the smooth running
of the firm.
International businesses are confronted with a number of accounting problems
that do not confront purely domestic businesses. Accounting is shaped by the
environment in which it operates. Just as different countries have different political
systems, economic systems, and cultures, so they also have different accounting
systems. In each country the accounting system has evolved in response to the
demands for accounting information in that country.
Five main factors seem to influence the type of accounting system a country
has: the relationship between business and the providers of capital, political and
economic ties with other countries, the level of inflation, the level of a country’s
development, and the prevailing culture in a country. National differences in
accounting and auditing standards have resulted in a general lack of comparability in
countries’ financial reports. This lack of comparability has become a problem as
transnational financing and transnational investment have grown rapidly in recent
decades (a consequence of the globalization of capital markets).
The most significant push for harmonization of accounting standards across
countries has come from the International Accounting Standards Committee (IASC).
Consolidated financial statements provide financial accounting information about a
group of companies that recognizes the companies’ economic interdependence.
Transactions among the members of a corporate family are not included on
consolidated financial statements: only assets, liabilities, revenues, and expenses
generated with external third parties are shown.
Foreign subsidiaries of a multinational firm normally keep their accounting
records and prepare their financial statements in the currency of the country in which
they are located. When the multinational prepares its consolidated accounts, these
financial statements must be translated into the currency of its home country.
Under the current rate translation method, the exchange rate at the balance
sheet date is used to translate the financial statements of a foreign subsidiary into the
home currency. This has the drawback of being incompatible with the historic cost
principle.
In most international businesses, the annual budget is the main instrument by
which headquarters controls foreign subsidiaries. Throughout the year headquarters
76
compares a subsidiary’s performance against the financial goals incorporated in its
budget, intervening selectively in its operations when shortfalls occur.
Vocabulary notes
accounting – учёт
to refer to – касаться, относится
loss statement – отчёт потерь, убытков
balance sheet – баланс
to evaluate – оценивать
expenditure – расходы
to confront – столкнуться
lack of consistency –
непоследовательность, нелогичность
exaggeration – преувеличение
to assess – определять сумму налога,
оценивать
assets – актив
liability – ответственность, пассив
accounting record – отчёт с бухгалтерского
учёта
incompatible – несовместимый
annual budget – годовой бюджет
to intervene – вмешиваться
drawback – преграда
shortfall – недостаток
consolidated
financial
statement
–
консолидированный финансовый отчёт
Comprehension and Discussion Questions
1. What is accounting?
2. What is accounting information?
3. What are international businesses confronted with?
4. What main factors influence the type of accounting system a country has?
5. What do consolidated financial statements provide?
6. How do consolidated financial statements provide?
7. How do foreign subsidiaries of a multinational firm normally keep their
accounting records?
8. What drawbacks does the current rate translation method have?
9. By what instrument does headquarters control foreign subsidiaries?
10.What is audit?
Ex. 1. Match the Russian terms with their English equivalents.
A
B
a) финансовая поддержка
1. corporate governance
b) экспериментальный
2. capital market
постприватизационный проект
c) развитие предприятия
3. advising government officials
d) преодолеть преграды
4. national-wide dissemination
e) информирование должностных
5. funding
лиц
6. outside funding
f) малый и средний бизнес
7. business development
g) распространение информации
8. a pilot post-privatization project
h) инвестиционная деятельность
9. overcoming obstacles
i) рынок капитала
10.SMB (small and medium business)
j) внешнее финансирование
11.investment activity
k) корпоративное управление
77
Ex.2. Translate the text into English using the key terms given in Ex.1.
1. При финансовой поддержке британского фонда «Ноу-Гау» МФК
(международная финансовая корпорация) начала в 1994 году
экспериментальный
постприватизационный
проект
«Развитие
предпринимательства».
2. Среди его главных задач:
- преодоление преград на пути развития малого и среднего бизнеса (МСБ);
- информирование должностных лиц правительства;
- распространение информации о важности МСБ для экономики.
3. Дополняя свою инвестиционную деятельность, МФК даёт техническую
поддержку и консультации предпринимателям и правительству с
вопроса приватизации и развития рынка капитала.
4. В Украине МФК внедряет проекты технической помощи за счёт внешнего
финансирования:
- развитие предпринимательства;
- корпоративное управление;
- реорганизация фирм и др.
Grammar
Verb+ -ing
Active
Indefinite
Perfect
using
having used
Passive
being used
having been used
The Gerund expresses an action which may be simultaneous (Indefinite) or
prior (Perfect) to that denoted by the finite verb.
We speak of using new method of Мы говорим об использовании новых
analysis.
методов анализа.
Thank you for having used my Спасибо за то, что использовали мои
calculation.
расчёты.
The Gerund can be preceded by a preposition which refers to it and can be
modified by a possessive pronoun or by a noun in the Possessive Case.
He insists on my sister’s studying Он настаивает на том, чтобы моя
economy.
сестра изучала экономику.
Mind the verbs followed by the Gerund:
avoid
finish
can’t stop
adore
keep on
don’t mind
admit
postpone
can’t help
give up
can’t stand
get used to
delay
excuse
require
put off
Ex.3. Define the Verbals: Gerund or Participle I.
1. Accounting has often been referred to as “the language of business”.
78
2. Accounting information is the means by which firms communicate their
financial position to the providers of capital.
3. The opening case drives attention to one of these problems – the lack of
consistency in accounting standards of different countries.
4. Five main factors seem to influence the type of accounting system a country
has, the prevailing culture being one of them.
5. The headquarters compares a subsidiary’s performance against the financial
goals incorporated in its budget, intervening selectively in its operations when
shortfalls occur.
6. Managers should be evaluated in local currency terms after making allowances
for those items over which they have no control.
7. We are considering the following main points of accounting.
Ex.4. Translate the following sentences into English paying attention to the
Gerund and its function in the sentence.
1. Мы интересуемся обсуждением экономических событий.
2. Прочитав текст, мы перевили его.
3. Он настаивал на том, чтобы заказ отправили вовремя.
4. Финансирование проектов малого бизнеса – основная задача
постановления правительства.
5. Лизингирование содействует развитию предпринимательства.
6. Основными задачами деятельности этого фонда является надсмотр за
банковскими операциями, привлечение инвестиций, обеспечение основ
развития малого и среднего бизнеса.
7. Мы не могли не смеяться над его выступлением на конференции по
вопросу современного бизнеса.
8. Он был занят подготовкой реферата.
9. Мы не знали о том, что он уже сдал экзамен по «Международному
праву».
10.Мы закончили писать контрольную работу и начали анализ текста
«Глобализация корпораций».
Text II. CREATING ECONOMIC SYSTEMS IN THE GLOBAL
MARKETPLACE
Democratic societies are not perpetual motion machines. They require a
continual investment of care and responsibility on the part of their citizen. The
experience of both emerging democracies and long-established democracies confirms
this. The most fundamental goods of democracy, such as the security of individual
rights, can exist only as long as most citizens share a sense of solidarity and common
destiny.
Contemporary life, however, is marked by increasing volatility in all areas of
social relationship. In particular, the dynamism of technology and the market
economy poses a mounting challenge. While democracies must find ways to cultivate
a sense of moral equality and shared destiny among citizens, the rapid spread of
79
market values to all aspects of life is teaching, and even enforcing, very different
lessons.
Increasingly, national societies are split into a minority class of economic
winners who inhabit a cosmopolitan world of affluence, and a growing underclass
with little hope of economic ascent. Moreover, as economic competition grows more
intense, the ties of social solidarity are placed under increasing strain. Systems of
social provision are likewise threatened, further undermining the sense of common
destiny among citizens.
However, the chief threat posed by the spread of market behavior into every
sphere of life is that social relationships become stripped of their moral meaning.
Thus, business ceases to acknowledge any responsibility to either its employees, the
communities where it operates, or to the nation which protects it through law. In the
same way, the individual is encouraged to think first of self-interest, not only in
business affairs but in the civic sphere, with respect to the natural environment, and
finally in community and family life.
The danger to democracy of the spread of market behavior is that society will
become increasingly atomized. With this, public responsibility, like social solidarity,
will wither away, leaving society incapable of dealing with large-scale and long-term
threats to its well-being. The chief question in the face of these threats is: How can
modern nations develop their economic and technological capacities without
damaging the moral and social underpinnings needed to fulfill the promise of
democracy?
Vocabulary notes
perpetual motion machines – вечные
двигатели
emerging
democracies
–
новые,
появляющиеся демократии
destiny – судьба, shared destiny – общая
судьба
volatility – изменчивость, непостоянность
areas of social relationship – сферы
общественных отношений
to pose a mounting challenge – ставить всё
новые задачи
to enforce – навязывать
to split – разделять, расчинять
1.
2.
3.
4.
5.
6.
affluence – изобилие, богатство
ascent – подъём, рост
strain – напряжение
to strip - лишать
to cease – прекращать, перестать
to encourage - поощрять
to acknowledge – признавать
to atomize – распылять
to wither away – отмирать, исчезать
well-being – благосостояние
underpinnings – основы
Comprehension and Discussion Questions
How would you characterize the development of democratic societies?
What does social volatility depend on in the world of market economy?
Does economic competition place national societies under increasing strain?
Can the spread of market economy and business lead to any social
irresponsibility?
The spread of market behavior can be the danger to democracy, can’t it?
Why cannot modern nations fulfill the promise of democracy?
80
Practical Task:
Read through text II and find in each paragraph a topical sentence that renders
the main information.
Text III. THE FALL OF BIG BUSINESS
“Big” no longer means, as it once did, “successful”; before long it is likely to
mean “failing”. If this prediction seems too bleak, recall how rosy the outlook seemed
for big firms ten years ago. When globalization became a cliché, businessmen
assumed that big firms would gain the most from lower trade barriers and converging
tastes. Global markets, it seemed, would call for global brands from global companies
managed globally. Firms big enough to spend lavishly on automated factories and
computerized offices would be able to exploit glittering new technologies faster than
smaller, and poorer rivals. … Many pundits confidently forecast that a handful of
giant firms would dominate car making, electronics, banking, entertainment,
advertising and publishing, to name only a few.
At the time, such predictions seemed plausible. For decades firms in almost
every business had sought “economies of scale”, the idea that manufacturing or
distributing goods in ever larger volumes lowers costs per unit, so that a firm becomes
more efficient as it grows. Most managers also recognized that expanding a business
also involves new costs. As they grow, firms may become more bureaucratic,
inflexible and wasteful. Employees, believing themselves to be mere cogs, are less
accountable and harder to motivate. But such diseconomies were usually a footnote.
They seemed more than outweighed by the benefits of bigness. The triumphs of mass
production early in the century had given birth to most of the giant firms which came
to tower over their industries. That bigger was better was rarely disputed. Until
recently it was even true. The great surprise of the last decade has been that the
changes which were supposed to make bigger even better have had the opposite
effect.
A blow to big firms is that the use of computers, confounding most forecasts, is
narrowing economies of scale in manufacturing and distribution, not expanding them.
Factory automation is making it possible to produce goods cheaply in smaller
volumes. The plummeting price of computers is enabling smaller firms to employ the
same logistical techniques, sophisticated financial models, and automated payrolls
and other administrative tasks that were available only to big firms in the past.
Vocabulary notes
prediction – предсказание
bleak – печальный
to recall – вспоминать
to assume – предполагать, допускать
lavishly – щедро
glittering – заманчивый
pundits – учёные мужи
confidently – убедительно
plausible – правдивый
entertainment – развлечение
inflexible – негибкий
wasteful – расточительный
mere cogs – всего лишь мелкие сосиски
footnote – второстепенный
to outweigh – превосходить
confounding – сбивающий с толку
plummeting – снижающийся
enabling - позволяющий
81
1.
2.
3.
4.
5.
Comprehension and Discussion Questions
Which two adjectives with opposite meanings are used here to talk about the
future?
If consumer tastes converge, do they become more similar or less similar?
If a prediction is plausible, is it credible?
If a forecast is confounded, is it proved right?
If a price plummets, does it fall by a small amount?
Text IV. LOWER SALES AND MARKETING COSTS ON THE INTERNET
Lower sales and marketing costs, and increased consumer choice and
convenience are driving the Internet’s increased use in travel planning and
reservations.
It is cheaper for an airline to process a ticket sale on-line than to use a travel
agent or a reservations center. Not only are transaction fees reduced, but savings are
also realized when cheaper electronic tickets can be substituted for more expensive
paper tickets. Through the use of the Internet and other information technology,
airlines expect to be able to significantly cut distribution costs.
At the $12 billion distribution, travel agent commissions, marketing and
advertising expenses, labor and other expenses for airline central reservations services
are the airline industry’s second largest operating expense.
How a ticket is sold, through an agent or by the airline directly, and whether the
ticket is paper or electronic, can mean the difference between paying $8.00 or $1.00
to process a ticket. Airlines are pursing various strategies to drive their distribution
costs down: lowering travel agent commissions, selling through the Internet, and
promoting electronic ticketing.
Southwest Airlines was the first major U.S. airline to let passengers buy tickets
directly on its Internet site in 1996, by-passing the agent and the commission. New
Web travel services quickly emerged: on-line travel sites sponsored by airlines
themselves, “virtual” travel agents like Microsoft’s Expedia.com and The SABRE
Group’s Travelocity.com, and travel agents’ own sites. Whether customers purchase
tickets on an airline’s site or through on-line travel agents, the airlines save money
since their own travel reservations centers do not have to be involved in the purchase.
In addition, the commissions they pay to on-line agents are about half what they pay
to traditional agents.
While the airlines’ ability to move customers away from paper tickets to lowercost electronic tickets does not depend on the Internet, it is proving to be a useful
vehicle for accelerating the shift. Some airlines encourage their Internet customers to
use electronic tickets by offering frequent-flyer miles for travel booked on-line with
an electronic ticket. Because Internet customers reserve their tickets, select seats and
give credit card information on-line, getting an electronic ticket rather than a paper
one seems natural.
Airlines also use the Web to generate additional revenues. No matter how
precise an airline’s forecasting, seats still go unsold on some flights. Selling airline
82
seats to the highest bidder and offering special “cuberfares” for leisure travel are two
techniques made possible by the Internet.
Every Monday or Tuesday, American Airlines look at its yield management
results and picks out low-performing markets. Midweek, more than one million
“NetSAAver” subscribers receive an e-mail from American Airlines listing special
discounted fares for travel in selected markets during the upcoming weekend. The
NetSAAver program has generated tens of millions of incremental dollars for the
airline since its launch in March 1996.
Vocabulary notes
convenience – удобство
to increase – возрастать, увеличивать
significantly – значительно
expenses – расходы
to pursue – использовать, следовать курсу
to drive down – снижать
to by-pass – обходить
to emerge – появляться
travelocity – скорость путешествия
to purchase – покупать
to involve – участвовать
to accelerate – ускорять
1.
2.
3.
4.
5.
6.
7.
to prove – доказывать, подтверждать
to offer – предлагать
frequent-flyer mile – частые авиа
маршруты
to book – заказывать
precise – точный
airline forecasting – заказ на авиабилеты
bigger – покупщик, заказчик
cuberfares – высокая авиа плата
yield – доход, результат
low-performing – малоэффективный
Comprehension and Discussion Questions
What is the role of the Internet for increasing consumer choice and
reservations?
Can the airlines significantly cut their distribution costs selling tickets on-line?
What strategies are used by airlines to drive their distribution costs down?
Which is cheaper: a paper ticket or an electronic one?
Would you like to reserve tickets through an agent or to get an electronic
ticket?
In what way can airlines generate additional revenues?
Is it convenient for a leisure traveler to reserve an electronic ticket for the
upcoming weekend?
Text V. BUSINESS AND THE ENVIRONMENT:
LESS IS MORE – MANUFACTURERS ARE TRYING TO CUT THEIR USE
OF PACKAGING MATERIALS
In the early 1980s, when Procter & Gamble first test-marketed a highly
concentrated laundry product, few people would buy it. Shoppers were put off by
what they perceived to be less fabric softener or washing liquid at a premium price.
Few of them seemed to care very much that so-called “ultra” products could slash the
amount of packaging finding its way into landfills.
But it was hard to keep a good idea down. P & G and other big consumer
products manufacturers are now profiting from a shift in consumer sentiment. By
83
1993, “ultra” – or concentrated – products were capturing about 70 per cent of the
laundry market, according to Green Market Alert, a trade newsletter.
“Consumers once believed more is more, now they think otherwise,” says
Jacqueline Ottman, a New York environmental consultant.
Concentrates are perhaps the most conspicuous success in the campaign by US
companies over the past decade to minimize the undesirable effects of their
packaging, most often by cutting the amount of material that requires disposal.
“Source reduction” is the buzzword phrase used in the field to describe a
movement that embraces package redesign, “light-weighting”, and greater use of
refillable containers and concentrates. It overlaps with efforts to promote recycling,
which slows down demand for virgin materials.
Over the past four years, P & G has cut its use of packaging materials overall
by 23 per cent, including a 42 per cent reduction in paperboard. It has also lifted the
level of recycle materials in its packaging to 37 per cent, from 23 per cent in 1989-90.
“There is now a critical mass of recycled materials available to meet our needs
and those of our competitors,” says Scott Sterwart, a spokesman for P & G.
Vocabulary notes
laundry product – прачечный продукт
to put off – отстранить
to perceive – воспринимать
fabric softener – смягчитель ткани
liquid – жидкость
premium – надбавка, премия
to slash – резко сократить
landfills – местные рынки
shift – сдвиг, смещение
capturing – охватывающий
otherwise – иначе, иным способом
environmental consultant – консультант по
окружающей среде
conspicuous – заметный
1.
2.
3.
4.
undesirable – нежелательный
disposal – удаление, избавление
source reduction – сокращение источника
buzzword – ходкое слово, молва
to embrace – охватывать
light-weighting – лёгкий вес
refillable – восполняемый
to overlap – частично покрывать
recycling – переработка втор сырья
virgin materials – первичные материалы
available - доступный
Comprehension and Discussion Questions
If you are put off by something, does it attract you?
If you keep a good idea down, do you
a) suppress it, or
b) keep it to use later?
If a success is conspicuous is it visible?
Is critical mass a good thing in this context?
84
UNIT IX
Text I. SUPPORT FOR ECONOMIC AND POLITICAL FREEDOM
In 1776, the Declaration of Independence heralded the birth of the United
States of America. In that same year Adam Smith’s seminal work on the importance
of free markets and fair competition, The Wealth of Nations, was published. The
principles in the Declaration of Independence have informed and enriched the lives of
Americans and peoples the world over who yearn for civil and political freedom.
Adam Smith’s work sparked a debate on economic freedom and the role of the state
in a nation’s economy – a debate that raged in the 20th century between those favoring
a free market-based economy and those favoring a state-planned economy. With few
exceptions in the world today, nations have chosen to let market forces determine the
direction and speed at which their economies develop.
We believe that intellectual property – copyrights, trademarks, patents, trade
secrets, and related right – provides important support to those freedoms. Barbara
Ringer, former U.S. register of copyrights, observed that the copyright laws of
England and the United States were “based on the harsh but free system of enterprise
that grew up in England and America. Under this system, authors are free to write and
live by writing if they can manage to command the attention of a large enough
segment of the populace to make the dissemination of their works even marginally
profitable.”
Trademark protection is similarly imbued with these characteristics. A free
market can hardly exist without a strong and effective trademark law. Without
sanctity for a commercial identity – thereby to enjoy the fruits of one’s labor – free
enterprise and the beneficial competition it engenders are without motivation. Patent
protection gives inventors the exclusive right to exploit their inventions. This
exclusive right gives them the economic security and, thereby, the freedom to follow
any path along which their human ingenuity and imagination may lead them. It is not
without reason that the 1948 International Declaration of Human Rights states, in
Article 27(2), that every creator has the right to the protection of his or her interest
“resulting from any scientific, literary, or artistic production of which he is the
author.”
Vocabulary notes
to herald – известить
seminal – первый, изначальный
to enrich – обогащать
to yearn [jə:n] – жаждать, стремится
to spark – воодушевлять
to rage – бушевать, не затихать
to favor – поддерживать
to determine – определить
related right – подобное право
harsh
enterprise
–
грубая
предприимчивость
dissemination – распространение
to imbue – насыщать, пропитывать
sanctity – неприкосновенность, святость
thereby – таким образом, посредством
этого
engender – порождать
ingenuity – изобретательность
85
1.
2.
3.
4.
5.
Comprehension and Discussion Questions
What sparked a debate on economic freedom in the XVIII century?
What has finally determined the direction and speed of development of today’s
economy?
What role does intellectual property play in supporting free economies?
Patent protection gives the economic security to writers, doesn’t it?
In what way does the 1948 Declaration of Human Rights support writers and
investors?
Text II. INTELLECTUAL PROPERTY HISTORICAL ROOTS OF THE
PROBLEM
Intellectual property is neither a new nor a static concept. The grant by a state
of some form of exclusive rights in their inventions to inventors originated in the
early part of the 15th century in Venice and spread rapidly during the 16 th century to
Germany, France, the Netherlands, and England. It was early recognized that in a free
market economy, patent protection provides the necessary incentive to invent, to
disclose the invention, to invest in the commercial development of the invention, and
to motivate others to add to the store of human knowledge by designing around the
patented invention. The Statute of Queen Anne, enacted in 1709 in England, was the
first true copyright statute and the first recognition of the source of the copyright
interest in the creative act of authors the benefit of economic rewards, while the
public receives the benefit of literature, music, and other creative works that might
not otherwise be created or disseminated.
Trademarks are thought to date back at least 3,500 years to potters’ marks used
to identify the source of fired clay pots. Jurisprudence and statutes for the protection
of trademarks appear to date back “only” 350 years, to early 17 th century England.
Trademarks serve to indicate the origin or source of a particular product or service
and, related to that, distinguish the goods or services of an enterprise from those of
other enterprises. Trademarks also serve an important consumer-protection function
in establishing the link between a good or service and its source. The consumer
knows, therefore, whom to turn to if he or she receives poor goods or services. Trade
secret protection is an integral part of honest business practices – if information is not
generally known, has commercial value, and the owner takes reasonable steps to
protect it, it should be protected. Trade secrets are often the oil that lubricates a
technology transfer agreement. Without it, the parties to an agreement find it difficult
or impossible to freely exchange the information vital to making the agreement work.
Laws for the protection of intellectual property are not static but change in
concert with changes in technology and society. In Book 2, chapter III of The Wealth
of Nations, Adam Smith stated that the labor of persons we now call “performers” is
“like that of menial servants, unproductive of any value, and does not fix or realize
itself any permanent subject, or vendible commodity, which endures after that labor is
past, and for which an equal quantity of labour could afterwards be procured.” He
concluded that, “like the declamation of the actor, the harangue of the orator, or the
tune of the musician, the work of all of them perished in the very instant of its
86
production.” In 1776 it was not possible, of course, to fix a performance in a tangible
medium. Today, a multimillion dollar worldwide industry has been built around the
fixation of performances in videos, cassette tapes, and compact disks.
It is these changes in technology that cause the greatest challenges and greatest
opportunities to the intellectual property system. It is a large part of the reason that
the norms in the field of intellectual property developed so rapidly in the 20 th century
– the century that saw the creation of photocopiers, radio, television, videocassette
recorders, cable television, satellites, computers, and the Internet.
Vocabulary notes
incentive – стимул, побуждение
to disseminate – распространять
to enact – вводить в действие
a potter – гончар
reasonable – разумный
vital – жизненно необходимый
to lubricate – подмазать, угощать
menial ['mi:njəl] – лакейный
1.
2.
3.
4.
5.
6.
7.
8.
vendible – годный для продажи
commodity – товар широкого потребления
harangue [hə'ræŋ] – публичная речь
to endure – терпеть, выносить
tangible – материальный
medium – средство
to procure [prə'kjuə] – обеспечивать
Comprehension and Discussion Questions
Where and when did the first protection right of intellectual property appear?
Where and when was the first statute of human rights enacted?
Could you describe the history of the world trademarks?
What is the main social reason for trademarks to appear?
What was Adam Smith’s approach to intellectual property?
What is the latest development in the intellectual property system?
If there were no laws protecting intellectual property, how would the situation
with human rights look like? Can you imagine?
How does the situation with intellectual property look like in Ukraine of today
(book, film, music recognize)?
Text III. THE PROTECTION OF INTELLECTUAL PROPERTY
Intellectual property refers to property, such as computer software, a screen
play, a music score, or the chemical formula for a new drug that is the product of
intellectual activity. It is possible to establish rights over intellectual property through
patent, copyrights, and trademarks. A patent grants the inventor of a new product or
process exclusive rights to the manufacturer, use or sale of that invention. Copyrights
are the exclusive legal rights authors, composers, playwrights, artists, and publishers
to publish and dispose of their work as they see fit. Trademarks are designs and
names, often officially registered, by which merchants or manufacturers designate
and differentiate their products (e.g., Christian Dior clothes, McDonald’s restaurants).
The philosophy behind intellectual property laws is to reward the originator of
a new invention, book, musical record, clothes design, restaurant chain, and the like,
for his or her idea and effort. As such, they are a very important stimulus to
innovation and creative work. They provide an incentive for people to search for
87
novel ways of doing things and they reward creativity. Consider innovation in the
pharmaceutical industry. A patent will grant the inventor of a new drug a 17-year
monopoly for production of that drug. This gives pharmaceutical firms an incentive to
undertake the expensive, difficult, and time consuming basic research required to
generate new drugs (on average it costs $100 million in R&D and takes 12 years to
get a new drug on the market). Without the guarantees provided by patents, it is
unlikely that companies would commit themselves to extensive basic research.
Protection of intellectual property rights differs greatly from country to
country. While many countries have stringent intellectual property regulations on
their books, the enforcement of these regulations has often been lax. This has tended
to be the case even among some countries that have signed important international
agreement to protect intellectual property, such as the Paris Convention for the
Protection of Industrial Property, which 96 countries are party to. We enforcement
encourages the piracy of intellectual property. China and Thailand have recently been
among the worst offenders in Asia. For example, in China local bookstores
commonly maintain a section that is off limits to foreigners – it ostensibly is reserved
for sensitive political literature but more often display illegally copied textbooks.
Pirated computer software is also widely available in China. Similarly, the street of
Bangkok, the capital of Thailand, are lined with stands selling pirated copies of Rolex
watches, Levi blue jeans, videotapes, and computer software.
International businesses have a number of possible responses to violations.
Firms can lobby their respective governments to push for international agreements to
ensure that intellectual property rights are protected in law and that the law is
enforced, and international laws are currently being strengthened. The most recent
world trade agreement, which was signed in 1994 by 117 countries, for the first time
extends the scope of the General Agreement on Tariffs and Trade (GATT) to cover
intellectual property. Under the new agreement, as of 1995, a council of the newly
created World Trade Organization (WTO) will oversee the enforcement of much
stricter intellectual property regulations. These regulations oblige WTO members to
grant and enforce patents lasting at least 20 years and copyrights lasting 50 years.
Rich countries must comply with the rules within a year. Poor countries, in which
such protection has generally been much weaker, have 5 years’ grace, and the very
poorest have 10 years.
Vocabulary notes
an
incentive
–
побуждение,
заинтересованность
to reward creativity – вознаграждать
творчество
enforcement – введение в действие
ostensibly – мнимо
to comply with – соответствовать
grace - благосклонность
Text IV. PRODUCT SAFETY AND PRODUCT LIABILITY
Product safety laws set certain safety standards to which a product must adhere.
Product liability involves holding a firm and its officers responsible when their
product causes injury, death, or damage. Product liability can be much greater if a
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product does not conform to required safety standards. There are both civil and
criminal product liability laws. Civil laws call for payment and money damages.
Criminal liability laws result in fines or imprisonment. Both civil and criminal
liability laws are probably more extensive in the United States than in any other
country, although many other Western nations also have comprehensive liability
laws. Liability laws are typically least extensive in less developed nations.
A U.S. boom in product liability suit and awards has resulted in a dramatic
increase in the cost of liability insurance. In turn, many business executives argue that
the high cost of liability insurance makes American businesses less competitive in the
global marketplace. This view was supported by the Bush administration. Former
Vice President Dan Quayle once argued that the United States has too many lawyers
and that product liability awards are too large. According to Quayle, product liability
insurance rates are typically much lower overseas, thereby giving foreign firms a
competitive advantage. Quayle does have a point; tort costs amount to about 2.4
percent of U.S. GDP, three times as much as in any other industrialized country. So
the costs of lawsuits does seem to put America at a competitive disadvantage.
Aside from the competitiveness issue, country differences in product safety and
liability laws raise an important ethical issue for firms doing business abroad.
Specifically, when product safety laws are tougher in a firm’s home country than in a
foreign country, or when liability laws are more lax, should a firm doing business in
that foreign country adhere to the more relaxed local standards, or should it follow the
standards of its home country? While the ethical thing to do is to adhere to home
country standards, firms have been know to take advantage of lax safety and liability
laws to do business in a manner that would not be allowed at home.
Vocabulary notes
comprehensive - разумный
liability - ответственность
to adhere to – придерживаться (правил)
tort – гражданско-правовой деликт
lax rules – либеральные правила
competitiveness issue – проблема
конкуренции
Scanning reading
You are going to scan the text about Product Safety and Product Liability.
Before you start doing that try to answer the following questions:
- Why did the EU ban the use of growth-promoting hormones in livestock and
impose a ban on the import of beef produced with such hormones? (It was in
1988)
- Some years ago Bushe’s chickens were forbidden for selling in Ukraine. Was it
a justified barrier to trade? Give your idea.
- Do you know any updated regulations related to food safety and animal health?
- What Ukrainian food products would you recommend for selling abroad?
Now scan the text and speak:
- About civil and criminal product liability laws.
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- About the difference of product-safety laws in a home country and abroad and
say if it is the right thing.
Text V. CONTRCT LAW
A contract is a document that specifies the conditions under which an exchange
is to occur and details the rights and obligations of the parties to a contract. Many
business transactions are regulated by some from of contract. Contract law is the body
of law that governs contract enforcement. The parties to an agreement normally resort
to contract law when one party believes the other has violated either the letter or the
spirit of an agreement.
Contract law can differ significantly across countries, and as such it affects the
kind of contracts that an international business will want to use to safeguard its
position should a contract dispute arise. The main differences can be traced to
variations in legal tradition. The two main legal traditions found in the world today
are the common law system and the civil law system.
The common law system evolved in England over hundreds of years. It is now
found in most of Britain’s former colonies, including the United States. Common law
is based on tradition, precedent and custom. When law courts interpret common law,
they do so with regard to these characteristics.
Civil law based on a very detailed set of laws that are organized into codes.
Among other things, these codes define the laws that govern business transactions.
When law courts interpret civil law, they do so with regard to these codes. Over 80
countries, including Germany, France, Japan, and Russia, operate with a civil law
system. Since common law tends to be relatively ill specified, contracts drafted under
a common law framework tend to be very detailed with all contingencies spelled out.
In civil law systems, however, contracts tend to be much shorter and less specific,
since many of the issues typically covered in a common law contract are already
covered in a civil code.
Vocabulary notes
transaction – ведение дел, сделка
enforcement – соблюдение, реализация
(мероприятий)
to resort to – ссылаться на что-то
1.
2.
3.
4.
5.
6.
to evolve – развиваться
contingencies – случайность, возможные
обстоятельства
Comprehension and Discussion Questions
What is a contract?
Does contract law differ across countries?
What are the two main legal traditions in the world today?
What is common law based on?
What is civil law based on?
Which countries operate with a civil law system?
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CASE STUDY
Management Focus Microsoft Battles Software Piracy in China.
Background information
World’s biggest personal computer software company, developed MS-DOC
and then Windows, the operating system and graphical user interface that now reside
on over 90 percent of the world’s personal computers. In addition, Microsoft has a
slew of best-selling applications software, including its word processing program
(Microsoft Word), spreadsheet program (Excel), and presentation program (Power
Point). An integral part of Microsoft’s international strategy has been expansion into
mainland China, where there were an estimated 2.2 million personal computers in use
in 1994, a number that was expected to grow by at least 1 million per year through the
rest of the decade. Moreover, with a population of 1.5 billion, China represented a
potentially huge market for Microsoft.
Key objectives of Microsoft
- To built Chinese sales from nothing in 1994 to $ 100 million by 2000.
- To make China respect Microsoft trademark and combat pirating its software.
- To make the Chinese government enforce its own intellectual property rights
laws in order to crack down on factories that the United States identified as
pirating US goods
- To increase the security of its goods and preserve the world monopoly.
Problem
To protect its interests and trademark Microsoft uses all possible means but
cant’s combat pirating. The Chinese authorities began to prosecute the counterfeit
manufacturing and even acknowledged that a copyright violation occurred. Microsoft
was awarded $2600 and the pirate company was fined $ 3000. Microsoft is appealing
the verdict and is requesting $ 20 million damages.
Discuss the problem, using the questions:
1. Will Microsoft reduce the price to compete with pirated versions?
2. Will Microsoft lobby the US government to pressure the Chinese authority to
start enforcing their own intellectual property laws?
3. Will Microsoft wage a “guerrilla warfare” by digging pirated goods?
4. How can Microsoft maximize the sales of legitimate products?
5. Do you think that the best way to stop the Chinese government from using the
pirated software is to go into business with it?
6. What tariffs should the US government impose?
7. How can Microsoft compensate its damages?
8. How can Microsoft go into business with China?
9. Will you admit any claims of the Chinese partners? Which?
10.Will you refer some cases to the International Arbitration Court?
11.How will you react on the decision of the EU Antidumping Committee to fine
Microsoft for preserving world monopoly rights?
Ex. 1. Choose the correct answer. Only one answer is correct. Write your
answers on the separate answer sheet.
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1. The right of the people to be … in their persons, houses, papers and effects, against
unreasonable searches and seizures, shall not be violated.
a) successful b) secure c) happy d) isolated
2. No person shall be compelled in any criminal case to be … against himself.
a) a witness b) an enemy c) an offender d) a defendant
3. Public international law does not have a uniform codified set of … laws.
a) use b) existed c) accepted d) modified
4. Different national legal system may compete for …, and the laws they choose
conflict.
a) laws b) police c) courts d) jurisdiction
5. Private international law is also affected by … conventions that provide a base for
initial unification of substantive law.
a) unilateral b) bilateral c) multilateral d) different
6. A patent … the inventor of a new product or process exclusive rights to the
manufacture, use, or sale of that invention.
a) grants b) obliges c) insists d) asks
7. Inventions, clothes design, books, provide an … for people to search for novel
ways of doing things and they reward creativity.
a) possibility b) incentive c) advantage d) characteristic
8. Many countries have … intellectual property regulations on their books.
a) weak b) complex c) stringent d) difficult
9. Weak enforcement … the piracy of intellectual property.
a) supports b) limits c) estimates d) encourages
10. Pirated computer … is also widely available in China.
a) software b) hardware c) cash d) equipment
11. Regulations … WTO members to grant and enforce patents lasting at least 20
years and copyrights lasting 50 years.
a) use b) oblige c) asks d) promotes
12. The problem is not a … of laws, the problem is that the existing laws are not
enforced.
a) plenty b) existence c) presence d) lack
13. Product safety laws set certain safety standards to which a product must … .
a) have b) belong c) adhere d) support
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14. … laws call for payment and money damages.
a) Civil b) military c) private d) state
15. The cost of lawsuit seems to put America at a competitive … .
a) advantage b) condition c) disadvantage d) profit
16. In a legal sense the term “property” … to resources over which individuals or
businesses hold legal title.
a) refers b) sustains c) call d) predetermines
17. Countries differ significantly in the extent to which their legal system … property
rights.
a) supports b) collects c) observes d) protects
18. Property rights can be … in two ways-through private actions and through public
actions.
a) maintaine b) violated c) developed d) stabilize
19. While theft occurs in all countries, in some countries a … legal system allows for
a much higher level of criminal action than in others.
a) weak b) strong c) reliable d) complex
20. Often successful business owners must … “protection money” to the Mafia or
face violent retribution.
a) neglect b) spend c) pay d) ask
21. Public action to violate property rights … when public officials, such as
politicians and government bureaucrats, extort income from property holders.
a) knows b) occurs c) simplifies d) asks
22. For example, the government in the Philippine was famous for … bribes from
foreign businesses wishing to set up operations in that country.
a) selling b) buying c) to depict d) demanding
23. China is not yet a member of the WTO and is therefore not obliged to … to the
agreement.
a) adhere b) support c) develop d) know
24. After the pressure from the U.S. government the Chinese government agreed to
… its existing intellectual property rights regulations.
a) develop b) mark c) enforce d) observe
25. The most recent world trade agreement was … in 1994 by 117 countries.
a) said b) know c) prepared d) signed
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UNIT X
Text I. HISTORY OF THE EUROPEAN UNION
Winston Churchill, former prime minister of Great Britain, stated in 1946 that
postwar Europe needed a …Sovereign remedy…to recreate the European family, or
as much of it as we can, and provide it with a structure under which it can dwell in
peace and safety and freedom. We must build a kind of United States of Europe.
Jean Monnet, who held a number of different positions in the French
government and is credited as the founding father of the EU, said that “the states of
Europe must form a federation.” George Marshall, Secretary of State for the United
States, supported this concept as a way to rebuild Europe after World War II and to
enable the United States to work with both the victors and the vanquished in Europe
as strong strategic allies. They hoped this type of partnership would obviate the
possibility of a third world war.
The EU was preceded by several earlier and less ambitious attempts at regional
cooperation. The European Coal and Steel Community (ECSC), established in 1952,
included the six founding countries and centered on combined price and output
controls, investment subsidies, tariff protection, and competition rules. Many of the
European coal and steel industries were and are government owned. The ECSC and
the respective governments were instrumental in rebuilding in the industries after the
war and in protecting those industries from competition.
Treaty of Rome. The European Community (EC as it was called) was formed
by the signing of the Treaty of Rome on March 25, 1957, which created the Common
Market. The six member countries (Belgium, West Germany, France, Italy,
Luxembourg, and the Netherlands) hoped to build on the success of the ECSC and
use the organization to advance all of the countries economically without sacrificing
their individual, culture, or sovereignty.
The Treaty of Rome stated the original objectives of the Community.
These principles were based on the creation of a customs union that would both
eradicate the internal tariffs and restriction and create a uniform external tariff for
nonmembers. The Community committed to achieving the free movement of people,
goods, services, and capital; and to eradicating the barriers to the establishment of
business by establishing a single, integrated common market. The goals of the
community are often stated as a commitment to the “Four Freedoms” – that is, to the
free movement of capital, goods, people, and services.
In 1965, the Merger Treaty integrated the ECSC and the EURATOM
(European Atomic Energy Commission, which was dedicated to the peaceful
development and application of nuclear energy) into the organization structure of the
EC. Denmark, Ireland, and the United Kingdom joined in 1973, Greece in 1981,
Portugal and Spain in 1986, and Austria, Sweden, and Finland in 1995.
1992 and the Single European Act. The ensuing years saw some progress
towards the ambitious goals stated in the Treaty of Rome, but the dream of free
movement of capital, goods, people, and services was not a reality between the
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member countries. Even today, fewer than two percent of the EU population lives
outside of the country of their birth.
In the 1980s, the member of the EC realized that because of their growth in
membership and strong national allegiances and the accompanying protectionism,
they had not achieved the goals of the Treaty of Rome. In 1985, the members called
“for the abolition of barriers of all kinds, harmonization of rules, approximation of
legislation and tax structures, strengthening of legislation and tax structures,
strengthening of monetary cooperation, and the necessary … measure to encourage
European firms to work together.” The member acknowledged the need to eliminate
physical barriers – such as custom checks at borders, veterinary and plant checks,
technical standards and building codes, and services and professional standards – and
to revamp VAT (Value Added Tax) collection. As a result of this realization and the
promise of increased competitiveness upon the elimination of these barriers, the
twelve existing members enacted the Single European Act (SEA), effective July 1,
1987. The purpose of the SEA was to strengthen the EC institutions and enable them
to act and thus to achieve the goals of the Treaty of Rome. The SEA also set the
deadline December 31, 1992, to achieve economic integration.
The Single European Act signaled a dramatic move away from business as
usual. The members abandoned the requirement of unanimous consent to move
forward and adopted the concept of qualified majority voting. This change meant that
for proposals related to the internal market all the countries did not have to agree –
the community could make decisions in spite of some objection. In December 1991,
the twelve leaders met in Maastricht, the Netherlands, and hammered out the historic
agreement known as Maastricht Treaty. The Treaty needed ratification by the member
states and in 1993 the European Union was born.
Vocabulary notes
remedy – средство
to dwell – находиться, жить
vanquished – побеждённые
to obviate – избегать
to sacrifice – жертвовать
to eradicate – ликвидировать
Merger Treaty – договор о слиянии
the ensuing years – следующие года
allegiance – верность
consent – согласие
to revamp – приукрашивать
1.
2.
3.
4.
5.
6.
EIDHR – the European Initiative for
Democracy and Human Rights
NGOS – Nongovernmental organization
EDF – European Development Fund
TACIS – Technical Assistance to the
Commonwealth of Independent states
ALA – American Latvian Association
MEDA – Mediterranean and Middle East
policy
PCAS – Partnership and Cooperation
agreements
Comprehension and Discussion Questions
What did Winston Churchill state in 1946?
What were the other opinions about the formation of a federation?
How many countries did the ECSC include?
What role did the ECSC play after the war?
When and how was the EC formed?
What was the main goal of the EC?
95
7. How do you understand the expression the “Four Freedoms”?
8. Why did the members of the EC realize that they hadn’t achieved the goals of
the Treaty of Rome?
9. When the SEA enacted and what was its purpose?
10. When was the EU born?
11.Is free trade always a good thing?
12.Do you think it leads to the creation of jobs or to unemployment?
13.Free trade should be encouraged through the world, but dumping should be
prohibited. Why?
14.How do you view the problem of international debt? What do you think should
be done about it?
15. What are the advantages and disadvantages of import and export for a
country’s economy? For the customer?
16.What are your country’s major imports and exports? Do you think products
made in your country are better than products made in other countries?
Ex. 1. Match the Russian terms with their English equivalents.
1. создать
a) to conclude the agreement
2. проложить путь
b) legislative body
3. вступить в силу
c) full member
4. цивилизованный подход
d) civilized approach
5. законодательный орган
e) pave the way
6. укласть соглашение
f) to set up
7. полноправный член
g) to go into effect
Ex. 2. Translate the sentences into English using the key terms given in Ex. 1.
1. Европейский союз – наибольшая мировая торговая организация, которая
пытается проложить путь для интеграции новых независимых государств
в европейскую экономику.
2. Европейский союз был создан после 2-й Мировой войны, когда Франция
официально предложила основать «Европейскую федерацию».
3. После присоединения ЕС к ГАТТ возник вопрос об унификации
внешнеторгового режима стран-членов ЕС.
4. Совет ЕС является основным законодательным органом Европейского
Союза. В этом органе представлены все страны-члены ЕС.
5. ЕС имеет исключительное право на подписание каких-либо
международных договоров.
6. Для того, чтобы защитить отечественное производство от иностранной
конкуренции, существуют тарифы, цель которых – сделать зарубежный
товар дороже, чем такой же товар, изготовлен в стране производителя.
7. В 1962 году было принято программу совместных действий стран-членов
ЕС по вопросу регулирования экспорта и импорта и создание единого
механизма регулирования в этой сфере.
8. Мировое хозяйство не может стабильно функционировать без каких-либо
совместных действий всех стран и механизмов координации управления.
96
9. В 1991 году Украина провозгласила независимость и таким образом взяла
на себя ответственность за самостоятельное проведение экономической и
законодательной политики перехода к открытой рыночной экономики.
Ex. 3. Translate the sentences into English using the Complex Subject or Object
Complex constructions.
1. Считаю, что этот вопрос уже рассмотрен.
2. Сообщаю, что они работают над новой технологией производства
продукции.
3. Он приказал, чтобы товары были доставлены вовремя.
4. Говорят, что эта компания была создана два года тому назад.
5. Так случилось, что мы решили эту проблему вдвоём.
6. Безусловно, конференция начнётся в конце этого месяца.
7. Я хочу, чтобы ему рассказали об этом.
8. Я наблюдал, как они работали.
9. Мы надеемся, что вы придете вовремя.
Ex. 4. Read the new words and try to memorize them. They will be used in the
texts for listening, skimming and scanning.
1. poverty
бедность
2. a legal framework
в пределах закона
3. in situ
действовать по обстоятельствам
4. prior agreement
предварительная договорённость
5. to bolster
поддерживать
6. to implement
воплотить в жизнь
7. consent
согласие
8. conflict prevention
предупреждение конфликтов
9. beneficiaries
выгоды
10. to emanate
вытекать (с предложения)
11. vulnerable
чуткий, впечатлителен
12. accession
вход, вступление
Text II. THE EUROPEAN UNION AND ITS INSTITUTION
European integration has delivered half a century of stability, peace and
economic prosperity. It has helped to raise standards of living, built an internal
market, launched the euro and strengthened the Union’s voice in the world.
The European Union (EU) was set up after the 2nd World War. The process of
European integration was launched on 9 May 1950 when France officially proposed
to create “the first concrete foundation of a European federation”. Six countries
(Belgium, Germany, France, Italy, Luxembourg and the Netherlands) joined from the
very beginning. Today, after four waves of accessions (1973: Denmark, Ireland and
the United Kingdom; 1981: Greece; 1986: Spain and Portugal; 1995: Austria, Finland
97
and Sweden).Nowadays the EU has 27 Member states and 23 working languages
English is the first language of the EU.
The European Union is based on the rule of law and democracy. It is neither a
new State replacing existing ones nor is it comparable to other international
organizations. Its Member States delegate sovereignty to common institutions
representing the interests of the Union as a whole on questions of joint interest. All
decisions and procedures are derived from the basic treaties ratified by the Member
States.
Principal objectives of the Union are:
 Establish European citizenship (Fundamental rights; Freedom of movement;
Civil and political rights);
 Ensure freedom, security and justice (Cooperation in the field of Justice and
Home Affairs);
 Promote economic and social progress (Single market; Euro, the common
currency; Job creation; Regional development; Environmental protection);
 Assert Europe’s role in the world (Common foreign and security policy; The
European Union in the World).
The EU is run by five institutions, each playing a specific role:
1. European Parliament (elected by the people of the Member states);
2. Council of the Union (composed of the governments of the Member States);
3. European Commission (driving force and executive body);
4. Court of Justice (compliance with the law);
5. Court of Auditors (sound and lawful management of the EU budget). Five
further bodies are part of the institutional system:
 European Economic and Social Committee (expresses the opinions of
organized civil society on economic and social issues);
 Committee of the Regions (expresses the opinions of regional and local
authorities on regional policy, environment, and education);
 European Investment Bank (contributes to EU objectives by financing
public and private long-term investments);
 European Central Bank (responsible for monetary policy and foreign
exchange operations).
Vocabulary notes
to derive from – выплывать с
Ombudsman
–
лицо,
которое
рассматривает
жалобы
людей
к
государственным служащим
Maladministration – недобросовестное
управление
to adjudicate – вынести решение
to lunch – вводить
internal market – внутренний рынок
accession – принятие
comparable – сравнимый
to derive – вытекать
treaty – договор
compliance – соответствие
Comprehension and Discussion Questions
1. What is a positive function of the European Union?
2. When was the European Union set up?
3. How many countries are there in the European Union?
98
4. What are the principles that the EU is based on?
5. Is it a new state or an integration of some countries?
6. In what way do the EU countries make their decisions?
Text III. EUROPEAN INITIATIVE FOR DEMOCRACY AND HUMAN
RIGHTS
Founded on the principles of freedom, democracy and the respect of Human
Rights, the European Union is defending these principles – protecting Human Rights,
consolidating democracy and the rule of law, as well as fighting poverty – the
promotion and protection of which are among its fundamental objectives.
Beyond the Community’s foreign aid programmes and the resources of the
European Development Fund, the European Initiative for Democracy and Human
Rights (EIDHR) offers the Union a legal framework and significant resources to
provide targeted aid and to act in situ, on its own initiative and without prior
agreement.
What is the European Initiative for Democracy and Human Rights? The
EIDNR serves to bolster the EU’s other action in the field of human rights and
democratization. Compared with other Community instruments EDF (European
Development Fund), Tacis (Technical Assistance to the Commonwealth of
Independent States), ALA (American Latvian Association), MEDA (Mediterranean
and Middle East policy), it:
 is complementary to these programmes which are undertaken with
governments in that it can be implemented with various partners, in particular
NGOs (Non-Governmental Organization) and international organizations;
 represents a type of “venture capital fund” for Human Rights, allowing
initiatives to be launched at a pilot or experimental level, which can then be
picked up by governments on a large scale;
 can be used without host governments consent or where mainline Community
programmes are not available;
 Constitutes an essential complement to the EU’s foreign policy and common
security objectives in the fields of human rights, democratization and conflict
prevention. In certain regions it represents the sole legal basis for certain
activities (political and civil rights protection, election monitoring, conflict
resolution initiatives, etc.).
For its beneficiaries, EIDNR provides an added value which sets it apart from
other donors. Because it is identified with the European Union, it is seen as reflecting
and promoting the EU’s democratic values. In this way, the EIDHR is considered to
emanate from Europe as a whole, rather than from specific interests or traditions.
Because it enjoys the political support of the EU, EIDHR subsidies can, in
certain cases, help protect vulnerable civil society organizations.
Because the EU is an organization committed to regional integration and given
the existence of agreements between the Union and regional groupings, the EIDHR
can also facilitate the adoption of Human Rights and democratization initiatives on a
regional basis.
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Text IV. POLITICAL AND ECONOMIC RELATIONS
The region is of key importance to the EU. With the EU enlargement process
eastwards, the EU and Eastern Europe will share a common border, requiring joint
approaches to many issues that directly affect the EU. The partner countries are also
important trading partners and energy suppliers.
Since the beginning of the 1990s, the relationship with the partner countries has
become broader. The political dialogue has been formalized through the Partnership
and Co-operation Agreements (PCAs), now in force with nine of the thirteen
countries. A PCA is a legal framework setting out the political, economic and trade
relationship between the EU and the partner country concerned. The implementation
of the PCAs is carried out through specific institutions on ministerial, senior official
and working level. For each of the PCAs, specific priorities and targets have been set,
based on the overall objectives of consolidation of democracy and human rights,
development of close political and economic relations, transition towards market
economy and social, financial and cultural co-operation. As a stepping stone to full
agreements, trade and co-operation agreements are still in force with some of the
partner countries.
Vocabulary notes
poverty - бедность
objective – цель
targeted aid – плановая помощь
to bolster – поддерживать
complementary – дополнительный
1.
2.
3.
4.
5.
to undertake – предпринимать
host government – местное правительство
vulnerable – уязвимый
to affect – оказывать влияние
implementation – выполнение
Comprehension and Discussion Questions
In what way are the foreign aid programmes arranged in the EU?
What can you say about the cooperation of the EU and EIDNR?
What role does the EU and PCAs play in regional integration?
How is the implementation of the PCAs carried out?
What is the economic perspective of the EU?
100
UNIT XI
Text I. INTERNATIONAL INVOLVEMENT IN BUSINESS
Trillions of dollars’ worth of business in international trade is conducted every
year. Certain trading nations – Japan, the United Kingdom, Hong Kong, Korea, and
Taiwan among them – draw their economic lifeblood from foreign trade, while
others, such as the United States, France, Germany, Russia, and China, are relatively
self-sufficient. Yet even the U.S. has become increasingly dependent on imported
TVs, VCRs, compact cars, oil, and other consumer goods. Ukraine is also dependent
on imported oil, gas, cars, electronic equipment, etc. Various foreign firms conduct
international trade and help products to compete well internationally.
There are 3 main types of firms involved in international activities. They are
exporting firms, international firms and multinational firms.
Exporting Firms. This lowest level of involvement in international business is
an excellent way for a firm to learn some of the ins and outs of doing business in an
international arena. As its name implies, an exporting firm simply exports its product
to a single (or very small number of) foreign countries. The majority of firm’s
business is conduct in its original location. Only a small part of the business is
conduct across an international boundary.
Many small firms do some international trade and thus may be considered
exporting firms. A number of large international firms began as exporting firms. For
example, IBM and Coca-cola exported their products to Europe for several years
before building manufacturing facilities there.
International Firms. The next level of involvement is international business.
An international firm is one with a significant portion of its business in several
foreign countries. And increasingly, it has some of its manufacturing plants in
overseas locations. However, while an international firm may be very large and have
a major impact on the global economy, it is still basically a domestic firm with
international operations. That is, the domestic market in its headquarters country is its
central concern. Product and manufacturing decisions typically reflect this concern.
The international firm then sells these products throughout the world. Examples of
international firms include McDonald’s, Burlington Industries, and BMW.
Multinational Firms. The highest level of involvement in international
business is the multinational firm. A multinational firm does not think of itself as
having a domestic part of its business and an international part of its business. Rather,
planning and decision making are geared to international markets. The location of
multinational’s headquarters is almost irrelevant. Examples of truly multinational
firm include Royal Dutch Shell, Nestle, IBM, and Ford.
An excellent example of a truly multinational firm is the British firm ICI. ICImore formally know as Imperial Chemical Industries – is one of the 50 largest
industrial firms in the world. To compete in a global economy, ICI has undergone a
dramatic transformation in its evolution to a multinational firm. ICI has nine major
business units, four of which are now headquartered outside of Britain. Until 1998, all
16 of ICI’s directors were British, but now there are two Americans, a Canadian, a
101
Japanese, and a German on the board. Rather than managing businesses within
countries, managers are now in charge of business units that compete around the
world. ICI has major operations in 25 different countries.
Vocabulary notes
to be dependent – зависеть от
level of involvement – уровень вовлечения
boundary – граница
to conduct business – заниматься
предпринимательской деятельностью
manufacturing facilities – производство,
производственные
мощности,
оборудование
overseas – за границей
major impact – значительное влияние
to reflect concern – тревожится
to have a concern in a business – быть
участником какого-либо дела
decision making – принятия решения
gear – приводить в движение
headquarters – главное управление, центр,
штаб-квартира
to headquarter – размещать
to be in charge of – быть ответственным за
on the board - в совете директоров
Comprehension and Discussion Questions
1. Which nations are considered to be self-sufficient in international trade and
which are dependent on imported goods?
2. What are 3 main types of firms involved in international activities?
3. Where to does an exporting firm supply its product?
4. Where is the majority of exporting firm’s business conducted?
5. What is international firm?
6. Describe its activities at the international arena.
7. What is the highest level of involvement in international business?
8. What is the typical location of the multinational firm?
9. Give examples of exporting, international and multinational firms?
10.In which firm would you like to work in future?
Sample resume
Lypskaya str, 16a – 66
Kyiv, Ukraine 01021
Telephone: +380442539116
E-mail: dns_d@yahoo.com
EDUCATION
Sept.2000 – Present
UMEA SCHOOL OF BUSINESS AND ECONOMICS – Umea, Sweden
C/D-level courses in Organization Theory, Policy and Strategy,
International Marketing, International Corporate Finance and Project
Management
- Grade Point Average: Pass with Distinction
Sept.2000 – Dec.2001 UKRAINE ACADEMY OF FOREIGN TRADE – Kyiv, Ukraine
- Part-time/ distance form. Major – International Management
- MSc. degree in International Management, December 2001
- Grade Point Average: 5.0 out of 5.0
Sept.1996 – June 2000
NATIONAL TECHNICAL UNIVERSITY OF UKRAINE – Kyiv,
Ukraine
BSc in Economics. Diploma with distinction. Major – Industrial
Marketing.
- A number of merit-based scholarships.
102
-
Grade Point Average: 5.0 out of 5.0
EXPERIENCE
Oct. 1999 – July 2000
PARLIAMENT OF UKRAINE, SCIENCE AND TECHNOLOGY
COMMITTEE
Assistant to the Chairman
- Responsible for providing research and analysis, draft legislation, briefing
MP, preparation of the materials for committee meeting and plenary
Sessions, etc.
- Part-time
Nov.1999 – Aug.2000 ADVERTISING AGENCY “ALPHA”
Marketing Manager
- Supervise staff of 2. Sales-related responsibilities: search for the
clients,
negotiations/ presentations, operational problems, etc.
Sept.1999 – Present
UKRAINIAN MARKETING ASSOCIATION
Assistant to the Vice-President
- Project-based assignments/ Part-time.
Nov.-1998 – May 1999 JOINT VENTURE “ACME”
Marketer
- Responsible for the statistical analysis of questionnaires, preparation of
reports and presentations, handling operational problems, etc.
HONOURS:
- Swedish Institute Scholarship, 2000-2001
- US Association of Former Members of Congress Fellowship, 1999-2000
LANGUAGES:
Ukrainian, Russian-native; English-fluent, German-average, Swedishelementary
EDUCATION:
July-Aug. 1999
Environmental Marketing course at the Umea Summer University, Sweden
Sep.1999-Apr.2000 German language course, Goethe-Institut
SKILLS:
- Driving license, 17.01.98
- Professional PC user: hardware, MS Windows/ Office, Web-design etc.
INTERESTS:
History, Sport, Literature
Vocabulary notes
to graduate with honors – заканчивать
to graduate with distinction – с отличием
feasibility studies – технико-экономическое
обоснование, бизнес-план
to supervise staff of … - иметь …
подчинённых работников
to affect trade – влиять на торговлю
restructuring – перестройка
skills – умение
grade point average – средний бал
BSc. in Economics (bachelor of science) –
степень бакалавра с экономики
MSc. Degree (master of science) – степень
магистра
to be responsible for – быть ответственным
за
scholarship – стипендия
driving licence – удостоверение водителя
Ex. 3. Match Russian terms with their English equivalents
A
B
a. производственные мощности
1. to affect trade
b. за границей
2. diligence
c. уровень вовлечения
3. evaluation of abilities
d. принятие решений
4. PhD
e. главное управление
5. decision making
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f.
g.
h.
i.
j.
k.
l.
совет директоров
влиять на торговлю
технико-экономическое обоснование
оценивание способностей
старательность
степень кандидата наук
лучший студент
6. top performer
7. manufacturing facilities
8. headquarters
9. overseas
10.feasibility studies
11.board
12.level of involvement
Ex. 4. Translate the sentences into English using key terms given in Ex. 3.
1. Существует три уровня вовлечение фирмы в международный бизнес: это
фирмы-экспортёры, международные компании и транснациональные
корпорации.
2. Иногда международные компании размещают свои производственные
мощности за границей.
3. ІСІ, транснациональная корпорация, имеет 9 основных бизнес-центров,
четыре из которых размещены за пределами Великобритании.
4. За обычаем международные компании производят товары в пределах
страны-производителя с последующей реализацией её за границу.
5. Фирма-экспортёр – это фирма, которая распространяет отечественную
продукцию в определённое количество стран.
6. Некоторые страны, такие как Япония, Великобритания, Гон-Конг, Корея,
Тайвань существует за счёт международной торговли, тогда как другие,
такие как США, Франция, Германия, Россия, Китай являются
самодостаточными странами.
7. Сейчас, даже экономика США зависит от импорта телевизоров,
видеокамер, нефти, и других товаров широкого употребления.
8. Фирма ищет работника, который владеет английским и немецким языком,
имеет соответствующие квалификации и опыт работы, легко общается с
людьми и имеет удостоверение водителя.
9. Он работает менеджером по международным отношениям в фирме
«Чумак» и имеет десять подчинённых ему работников.
10. По окончанию Украинской академии внешней торговли он получил
степень бакалавра по международному менеджменту. Сейчас он
продолжает учиться в академии и по окончанию получит диплом
магистра международного менеджмента.
Text II. SIX WAYS OF ENTERING A FOREIGN MARKET
There are six ways of entering a foreign market: exporting, turnkey projects,
licensing, franchising, joint venturing, and setting up a wholly owned subsidiary.
Exporting has the advantage of avoiding the costs of setting up manufacturing
operations in another country. Disadvantages include high transport costs and trade
barriers and problems with local marketing agents. The latter can be overcome if the
firm sets up a wholly owned marketing subsidiary in the host country.
104
Turnkey projects allow to export their process know-how to countries where
FDI might be prohibited, thereby enabling the firm to earn a greater return from this
asset. The disadvantage is that the firm may create efficient global competitors in the
process.
The main advantage of licensing is that the licensee bears the costs and risk of
opening a foreign market. Disadvantages include the risk of losing technological
know-how to the licensee and a lack of tight control over licensees.
The main advantage of franchising is that the franchisee bears the costs and
risks of opening a foreign market. Disadvantages center on problems of quality
control of distant franchisees.
Joint ventures have the advantages of sharing the costs and risks of opening a
foreign market and of gaining local knowledge and political influence. Disadvantages
include the risk of losing control over technology and a lack of tight control.
The advantages of wholly owned subsidiaries include tight control over
operations and technological know-how. The main disadvantage is that the firm must
bear all the costs and risks of opening a foreign market.
The optimal choice of entry mode depends on the strategy of the firm.
When technological know-how constitutes a firm’s core competence, wholly
owned subsidiaries are preferred, since they best control technology.
When management know-how constitutes a firm’s core competence, foreign
franchises controlled by joint ventures seem to be optimal. This gives the firm the
cost and risk benefits associated with franchising, while enabling it to monitor and
control franchisee quality effectively.
When the firm is pursuing a global or transnational strategy, the need for tight
control over operations to realize location and experience curve economies suggests
wholly owned subsidiaries as the best entry mode.
Strategic alliances are cooperative agreements between actual or potential
competitors.
The advantage of alliances is that they facilitate entry into foreign markets,
enable partners to share the fixed costs and risks associated with new products and
processes, facilitate the transfer of complementary skills between companies, and can
help firm establish technical standards.
The disadvantage of a strategic alliance is that the firm risks giving away
technological know-how and market access to its alliance partner in return for very
little.
The disadvantages associated with alliances can be reduced if the firm selects
partners carefully, paying close attention to the issue of reputation, and structures the
alliance so as to avoid unintended transfers of know-how.
Two of the keys to making alliances work seem to be (i) building trust and
informal communications networks between partners and (ii) taking proactive steps to
learn from alliance partners.
105
Vocabulary notes
turnkey project – проект «под ключ»
(предприятие полностью укомплектовано)
licensing – лицензирование
joint venture – совместное предприятие
1.
2.
3.
4.
5.
subsidiary – дочернее предприятие,
филиал
FDI (Foreign Direct Investments) – прямые
иностранные инвестиции
disadvantage – неблагоприятные условия
Comprehension and Discussion Questions
What are the six ways of entering a foreign market?
Which of the ways in your opinion is the most important?
When do foreign franchises seem to be optimal?
What can help firm establish technical standards?
What are two keys to making alliance work?
Text III. INTERNATIONAL LAW AND BUSINESS
The legal system of a country refers to the system of rules, or laws, that
regulate behavior, along with the processes by which the laws of a country are
enforced and through which redress for grievances is obtained. The legal system of a
country is of immense importance to international business. A country’s laws regulate
business practice, define the manner in which business transactions are to be
executed, and set down the rights and obligations of those involved in business
transaction. The legal environments of different countries can and do differ in
significant ways. Differences in legal systems can have an important impact on the
attractiveness of a country as an investment site and/or market.
Like the economic system of a country, the legal system is influenced by the
prevailing political system. The government of a country defines the legal framework
within which firms do business, and often the laws that regulate business are a
reflection of the rulers’ dominant political ideology. For example, collectivist-inclined
states tend to enact laws that severely restrict private enterprise, while the laws
enacted by governments in democratic states where individualism is the dominant
political philosophy tend to be pro-private enterprise and pro-consumer.
Up to this point, our attention was focused on the legal system of a country and
not specifically on international business law. Scholars and practitioners often divide
international law into two categories: public international law and private
international law.
Public international law governs relations between countries as recognized
entities in international society. In exception cases countries participate in private-law
relationship if one of the parties is an individual or legal entity and the other party is
the state satisfying its needs (for example in awarding state contracts, etc). Public
international law does not have a uniform codified set of accepted law.
Private international law, defined as the laws applying to private parties in
international transactions, is sometimes described as conflict of laws or the “domain
of rights, duties, and disputes between and among persons from different places”, and
often involves commercial transactions. In other words, private international law
concern how nation’s courts deal with different nation’s laws. Different national legal
106
system may compete for jurisdiction, and the laws they choose conflict. So we may
state that private international law is not a law governing relations between countries,
but rather the internal law of a country that governs issues important for legal
relations with an international element. Although international agreements (contracts)
are among the important sources of private international law, these international
agreements, too, are part of the domestic legal system if a country is bound by them,
i.e. signed the treaties, passed through the ratification process including subsequent
publication – the collection of laws, the bulletin, etc.
Just as public international law, private international law has no uniform
codified set of accepted law. The field of conflict of laws consists of three areas:
choice of law (which law applies to the transaction), choice of forum (who has
jurisdiction or the power to hear the case), and recognition and enforcement of
judgments. Private international law is also affected by multilateral conventions that
provide a base for initial unification of substantive law.
Examples of these conventions include:
- Recognition and Enforcement of Foreign Arbitral Awards (June 10, 1958)
- Service Abroad of Judicial and Extra-Judicial Documents (November 15, 1965)
- Hague Convention on International Child Abduction (1980)
- U.N. Convention on Contracts for International Sale of Goods (April 11, 1980)
In this unit we will focus on three issues that illustrate how legal systems can
vary among countries – and how such variations can affect international law and
business.
First we look at the laws governing property rights with particular reference to
patents, copyrights, and trademarks. Second, we look at laws covering product safety
and product liability. Third, we look at country differences in contract law (see
Sections D, E).
Vocabulary notes
legal system – правовая система
domestic legal system – внутренняя
правовая система
public international law – международное
публичное право
private international law – международное
частное право
contract law – договорное (контрактное)
право
liability law –
product liability – качество товара
to enact laws, to enforce laws – вводить
(устанавливать) законы
enforcement of judgments – исполнять
решения суда
rights and obligation – права и обязанности
property rights – имущественные права,
права собственности
jurisdiction – юрисдикция
redress of grievances – возмещение
to hear the case – слушать дело
recognized entities (in international society)
– выдающиеся члены (международного
сообщества)
individual or legal entity – физическое или
юридическое лицо
awarding state contracts – распределение
государственных контрактов
investment
attractiveness
–
инвестиционная привлекательность
to govern relations – регулировать
отношения
to be bound by – брать на себя
обязательства выполнять что-либо
internal law – внутреннее право
collection of laws – свод законов
to sign a treaty – подписывать соглашение
107
1.
2.
3.
4.
5.
6.
7.
8.
Comprehension and Discussion Questions
Why is the country’s legal system of immense importance to international
business?
What two categories is international law often divided into?
What does public international law govern?
Is it possible for countries (on governmental level) to participate in private-law
relationship?
How is sometimes private international law defined?
What is the main difference between public international law and private
international law?
What three main areas does the field of conflict of laws consist of?
What is private international law usually affected by?
Ex. 1. You know that Ukraine has become a member of the United Nations
Convention on Contracts for the International Sale of Goods, which is one of the
“direct rules” of private international law and is a component of the legal
systems of the countries that are party to it.
Read the abstract concerning the purchase contract and express your
opinion whether the Convention is always given priority over any other laws and
regulations of the countries-member to this Convention:
Abstract
According to Article 1 of the Convention, it applies in the following cases:
“…to contract of sale of goods between “… в контрактах на продаж товаров,
parties whose places of business are in что составляют стороны, которые
different States when the states are разместили свои предприятия в
Contracting States [i.e. parties to the странах-учасниках
[т.е.
странахConvention]”.
учасниках конвенции]”.
Check yourself:
The Convention takes precedence over other internal legal precepts. This
means that if a business in Ukraine signs a purchase contract with a business in
Austria, then the Convention is used for coverage of their relationship, and not for
example of the commercial codes of Ukraine and Austria. However, the parties to the
contract have the possibility of explicitly excluding use of the Convention in an
agreement on the decisive legal system.
Vocabulary notes
The United Nations Convention on
Contracts for the International Sale of
Goods
–
Конвенция
Организации
Объединенных
Наций
согласно
Контрактов на международную продажу
товаров
purchase contract – контракт куплипродажи
to take precedence – иметь приоритет
legal precepts – нормы права
commercial code – свод законов
108
Ex. 2. You are a member of the Ukrainian business delegation. Your main aim
is to conclude a purchase contract with your Portugese partner. Is it possible to
use the U.N. Convention on Contracts for the International Sale of Goods for
this purpose? See Article I of this Convention. It runs:
“… when the rules of private “… когда нормы международного
international law lead to the application частного права служат применением
of the law of a Contracting state [by права страны-учасницы [согласно с
agreement of the parties or a collision соглашением сторон или колизиею
rule]”.
норм]”.
Check yourself:
This applies even in cases where the parties to the contract do not have their
place of business in countries that are party to the Convention. Thus, for example if
purchase contract is signed by a business in Ukraine, which is a signatory country,
and a business from Portugal, which is not, and a collision rule or agreement by the
parties refers to the law of Ukraine, or if neither of the parties to the contract has its
place of business in a signatory country but they agree on use of the legal system of a
signatory country as the law of a third country, then the Convention is applied,
because it is a component of the chosen legal system.
Ex. 3.
Brainstorming
Divide into two groups.
Take a sheet of paper and write down advantages and disadvantages of the
collectivist-inclined states legal systems (one group) and democratic states legal
system (another group). Time limit is 10 minutes. Appoint a spokesperson from
each group who’ll present your decisions.
Vocabulary notes
business – предприятие
a signatory country – страна - участница
(Конвенции)
collision rule – колизейная норма
to apply in cases – касаться случаев
to refer to the law – содержать посылание
на закон
chosen legal system – выбранная правовая
система
Ex. 4. Look at the list of the prepositions in the box. How can use them in the
sentences below?
in
among
to
with
by
of
on
since
into
between
for
from
1.
2.
3.
4.
The legal system … a country refers … the system of rules or laws.
International law can be divided … two categories.
Legal system can vary … countries.
The relations … Ukraine and Great Britain are improving now.
109
5. The UN Convention … Contracts … International Sale of Goods was adopted
… 1980.
6. The laws enacted … governments … democratic states tend to be pro-private
enterprise.
7. They have an important impact … the attractiveness … a country as an
investment site.
8. Some legal entities have already placed many orders … them.
9. The laws governing property rights … particular reference … patents,
copyrights and trademark have been debated … 1995.
10. Different national legal system may compete … jurisdiction.
Ex. 5. List A contains some basic terms in the field of international law. Choose a
term in A to fit each definition in B.
A
B
1. law
a. as it exists in practice.
2. de jure
b. possessions, things owned, unrestricted and
exclusive right to a thing.
3. property
c. exclusive right of authors of original writing and
artistic work to sell or reproduce their work for their
life time plus fifty years.
4. de facto
d. special designs, names or unique symbols that
identify a product, service or company.
5. trade mark
e. according to legal requirements.
6. copyright
f. rule of conduct formally recognized as binding or
enforced by authority.
Ex. 6. Match the key terms in Line A with their English equivalents in Line B.
A
B
1. trade practices
а) иметь приоритет
2. commercial cases
б) контрактное соглашение
3. applicable legal system
в) Международное Коммерческое Соглашение
4. to take priority
г) торговые обычаи
5. provision
д) решающая правовая система
6. mandatory provisions
е) стороны контракта
7. to depart from
ж) статья
8. contractual agreement
з) Торговая палата
9. parties to the contract
и) обязательные нормы
10. interpretive rules
й) толковые правила
11. International Commercial к) коммерческие отношения
Terms (INCOTERMS)
12. Chamber of Commerce
л) уклонятся от
110
Ex. 7. Translate the text into English using the key terms given in Ex. 6.
Торговые обычаи – правила некоторой отрасли, которые не
кодифицируются. Обычаи могут быть разными, соответственно их вида товара,
вида коммерческих отношений и т.д. Всегда необходимо выяснять, признаёт ли
решающая правовая система некоторые торговые обычаи, и за каких условий.
Правовые системы, а также Конвенция Организации Объединенных
Наций «О контрактах и международной продаже товаров», содержат похожие
статьи. Торговые обычаи всегда имеют приоритет перед обязательными
нормами решающей правовой системы, от выполнение которых стороны не
могут уклониться путём составления контрактного соглашения.
Стороны контракта могут сговориться об уклонении от некоторых
толкованных правил.
Международные Коммерческие соглашения являются системой
определенных толковых правил, впервые опубликованных Парижской
международной Торговой палатой в 1936 г.
Grammar
Modal Verbs and their Equivalents
Verbs
Present
can
can
be able to
Past
could
was
Future
will be able to
} able to
may
may
be allowed to
must
must
have to
be to
were
might
was
} allowed to
were
had to
was
} to
were
will be allowed to
will have to
will be to
Modal Verbs “Shall” and “Will”
I. The modal verb “Shall” (past: should) is used to express compulsion, obligation in
commands, regulations, proclamations, pacts, treaties contracts, charters, etc:
You shall do it immediately. – Ты должен сделать это немедленно.
The award of the Arbitration Court shall be final and binding upon the both parties. –
Решением Арбитражного суда является обязательным к исполнению для обеих сторон.
Shall is used with all persons in question when asking for instructions:
What shall be done with this document? – Что нужно сделать с этими документами?
Shall I sign the contract? – Я должен подписать контракт?
The verb “Shall” is used to express promise, warning or threat:
You shall be responsible for the delay of payment. – Ты несёшь ответственность за задержку
оплаты.
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II. The modal verb “Will” (past: would) is used to express will, intention or
insistence:
We will never agree to these terms. – Мы никогда не согласимся на эти условия.
Will (would) is used to express polite requests and inquiries:
Will you inform us about the reasonable prices? – Сообщите нам, пожалуйста, об умеренных
ценах.
Will (would) is used to express habit and is commonly used in literary descriptions:
They will (would) meet and discuss news. – Они (бывало) встречались и обсуждали новости.
The verb “will” (would) may be used to express insistence or resistance:
The judge will not accept the objection. – Судья не принимал протест.
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UNIT XII
Text I. TRANSPORTATION AS FACTOR OF ECONOMIC DEVELOPMENT
Transportation has always been a vital factor in the cultural and economic
development of the human race and the effort to improve transportation has occupied
much of man’s time and effort through the centuries. Nations, regions, cities,
industries, and business firms have grown or failed to grow because of the presence or
absence of adequate transportation facilities. Those areas of the world that have
developed culturally and economically the earliest and fastest have been those that
had adequate transportation. Hence the great old cities of the world were all located
where adequate and long distance water transportation was available. Those areas
without adequate water transportation had to wait the coming of other modes of
transportation before their development could really begin. In modern times we find
that the interior of the continent of Africa is still to a extent underdeveloped culturally
and economically partly because it has been in the past, and still is to some degree,
inaccessible.
The only access to villages, agricultural and other productive areas in Africa
are earth roads. They account for a considerable proportion of the road network, but
most of them are generally operable only during the dry season. A large proportion of
the fleet remains immobilized for long periods, a situation which adversely affects the
overall economic performance of developing Africa.
The Africa railway system is composed of several short independent national
systems of different gauges, which makes it difficult to promote socioeconomic
integration at the national, subregional and regional levels. Also, because of the old
age of rails, the poor alignment and the low construction standards, the average
operating speed of the railway system is only about 40 km/h. the railway traffic is
also very low.
In the area of air transport, while 40 foreign airlines and 51African airlines
serve the continent, only 20 per cent of the total air transport operations involve direct
links among African countries. In maritime transport, the volume of Africa’s seaborne
trade has increased only marginally. The low level of the shipping capacity of Africa
explains the very large share of Africa’s seaborne trade handled by foreign vessels.
So, it appears that economic progress is inevitably tied to transportation. This is
basically because trade or commerce cannot flourish without an adequate
transportation system at reasonable cost and without trade there can be little in the
way of industrial activity and the employment and that this brings about.
Vocabulary notes
access ['ækses] to … доступ, подход к…,
accessible – доступный, достижимый
inaccessible – недопустимый недосягаемый
earth road – грунтовая, поселочная дорога
network – сеть
road network – сеть дорог
to be operable – функционировать,
действовать
fleet – парк транспортных средств
to remain immobilized – бездействовать
adversely [ 'ædvə:sli] – неблагоприятно
to affect оказывать влияние,
воздействовать
railway
(railroad)
system
–
железнодорожная сеть
gauge [geidз] – железнодорожная колея
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age зд. – срок службы
the old age of the rails – длительный срок
эксплуатации путей
alignment тех. – выравнивание (рельсов,
путей)
poor alignment – плохое состояние колеи
operating speed – эксплуатационная
скорость
traffic – 1. движение, сообщение,
транспорт, 2. перевозки
1.
2.
3.
4.
railway traffic – перевозки по железной
дороге
maritime transport – морской транспорт
seaborne trade – морская торговля
marginally – незначительно
shipping capacity – грузовместимость,
грузоподъемность
to handle зд. – транспортировать,
осуществлять перевозки
reasonable cost – недорогая, сходная цена
Comprehension and Discussion Questions
What is the role of transportation in the cultural and economic development of
the world?
What is the condition of road transport in Africa? What roads prevail there?
Why is the greater part of the fleet immobile for long periods and what is being
done to make it operable all through the year?
What is reason for such low railway traffic in Africa?
Why are direct links by air among African countries mostly served by foreign
airlines and why is the large share of Africa’s seaborne trade handled by
foreign vessels?
Ex. 1. Read the text and do the tasks:
a) Find in text the terms with the word “transportation (transport)”. Translate
them into Russian and use them in sentences of your own.
b) Give the terms which are used in the text to characterize the African road
network and railway system.
c) Name different types of roads you know.
Ex. 2. Translate the following sentences into English in writing. Make use of the
Vocabulary notes, if necessary.
a) Транспорт был всегда существенным фактором в культурном и
экономическом развитии человечества.
b) Нации развивались благодаря наличию транспорта и не развивались,
когда он отсутствовал.
c) Те регионы, которые начали развиваться раньше и быстрее других,
имели хорошо развитый транспорт.
d) Крупные города мира всегда располагались там, где были водные пути
большой протяжённости, и имели хорошо развитый водный транспорт.
e) Там, где не было хорошо развитого водного транспорта, экономическое
и культурное развитие начиналось лишь с появлением новых видов
транспорта.
f) Африканский континент до сих пор ещё недоступен из-за отсутствия
хорошо развитого транспорта.
g) Единственными дорогами, обеспечивающими доступ к африканским
деревням, сельскохозяйственным и производственным районам,
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являются грунтовые дороги. Но они, как правило, функционируют
только во время сухого сезона. Значительная же часть парка
транспортных средств бездействует в течение длительного времени.
h) Железнодорожная сеть Африки состоит из нескольких коротких, не
связанных друг с другом национальных сетей с различной шириной
колеи. Средняя эксплуатационная скорость железнодорожного
транспорта в Африке составляет только 40 км/час.
i) В области воздушного транспорта только 20% всех авиа перевозок
приходится на прямые рейсы между африканскими странами.
j) Объём морских торговых перевозок увеличился незначительно. Из-за
низкого уровня грузоподъемности флота Африки большая часть
морских торговых перевозок осуществляется иностранными судами. Всё
это неблагоприятно сказывается на экономическом развитии Африки.
Ex. 3. The extracts below describe the early stage of the development of
transport. Read them and make a comparison with the development of transport
in Africa.
A revolutionary improvement in the efficiency of transport was an essential
element in the achievement of great productive expansion. Such improvement was
brought about mainly by applying mechanical power to the movement of men and
goods. In some of the wealthier countries many non-mechanical improvements in
transport were introduced in the eighteenth and early nineteenth centuries. New roads
with better surfaces, more smoothly running carts and carriages to use them, riverimprovement schemes and the cutting of artificial inland waterways, larger and faster
sailing ships were among the contributions of economic improvement. They
facilitated and cheapened the movement of both passengers and freight, particularly
over fairly short distances, though better sailing-ships improved communication
across the Atlantic, and the European roads could carry a bigger volume of traffic
than before.
Ex. 4. Basing your answer on the text speak on the history of motor cars.
When Karl Benz traveled those few hesitant yards in the world’s first petroldriven car in October 1885, who could have foreseen the tremendous impact this
strange machine was to make on the 20th century way of life? Yet within thirty years
there were four million motor cars in existence: the prototype horseless carriage had
been transformed into a practical, essential means of transport.
The First World War saw the motor car in an entirely new role. Thousands of
people came in contact with motor vehicles in the war effort, and peace brought with
it an unprecedented demand for cars. The Twenties witnessed the car at a peak in
individual character, with a quality of workmanship unequalled in later years when
mass production dominated. The variety in design was astonishing, ranging from the
utilitarian Austin Seven to the magnificent super-luxe models such as Rolls-Royce,
Cadillac and others.
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Ex. 5. Read the following texts and discuss the situation in the car markets of
Europe and Asia. Use current press material.
When Mercedes announced that it would build a cheaper car, the company’s
chief executive pointed to a changed world in which pollution and traffic congestion
make small cars beautiful. Even so, hours of choking in traffic jams have not
persuaded Thai drivers of small cars’ virtues. And they are not alone. Throughout
South-East Asia, where demand is growing at rates Europeans and Americans have
long forgotten, old-fashioned luxury is still very much in fashion.
Although modest Japanese cars still dominate Thailand, large and luxurious
European marques are increasing their sales faster than any others. Compared with an
expansion of overall car sales of 82% in Thailand last year, BMW’s sales double.
Sales of Mercedes increased by 135%, reaching 5,649 – worth well over $500m. In
Thailand’s poverty-stricken neighbours, Vietnam and Cambodia, the prospect of
satisfying even a fraction of such demand leaves aspiring dealers salivating. In
Cambodia’s capital, Phnom Penh, the bicycle-taxi remains the most common form of
transport. But a BMW showroom has joined Mercedes’ franchise on the town’s main
street.
The surge in foreign-car sales in Thailand is explained partly by a general
reduction in the country’s tariffs and taxes. But only partly: an import tax of more
than 200% remains, leaving a Mercedes in Thailand breathtakingly expensive by
European standards. A Mercedes 280E, not even top of the range, sells there three
times its price in Germany. The full explanation lies in South-East Asians’ belief that
you are what you drive. Up-and-coming businessmen think that a flashy car is
essential to their commercial standing. But not only the rich aspire to luxury; so does
a “high-taste, but low-income” class, willing to borrow heavily in order to drive in
style.
Consumer preferences like this might persuade Mercedes to reconsider its new,
faintly puritanical line. The emerging economies of Asia still represent small markets
for the world’s car makers, but their populations are growing at a remarkable rate.
Over the past decade the number of people per car has remained steady in Europe and
America, but it has double in Asia. Mitsubishi Research, a consulting firm, thinks that
the car market in South-East Asia will double over the coming decade. With many of
the region’s cities already clogged with traffic, the stage is set for luxurious gridlock.
Ex. 6. Read the following text and explain the advantages of privatizing railways
in Great Britain.
The British public loves railways, even as it hates the way they are run. For
railway fans, privatization should, in principle, offer three huge advantages. First, it
should encourage the rooting-out of inefficiency. By some measures British Rail
compares well with other European railways; only the Dutch railway beats it on costs
per kilometer traveled. But waste remains endemic: when a railway in small country
employs 35,000 civil engineers, something is amiss.
Second, private operators should bring an infusion of new marketing skills.
British Rail is notorious for its anti-consumer culture: scruffy staff, poor
communications, queues and crowds. It is improving, but not fast enough. Railmen
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sneer that competitors will just bring a lick of paint, in-carriage television and pretty
hostesses. But if that is what customers want, they must get it, or they will switch to
cars and flying.
Third, privatization should mean more and better investment. After
privatization, investment would no longer be restricted by artificial Treasury-imposed
limits. The change has had happy results in other privatized industries.
Will the government’s chosen means of privatization deliver these theoretical
benefits? If, like British Gas, British Rail had been privatized in 1985, it would have
been sold as one lump. If, like electricity, it had been privatized in 1988, it would
have been broken into separate regional rail companies, each with a monopoly. The
privatisers of 1993 are thinking more radically. They are no longer content to turn
nationalized industries into regulated monopolies. They want the maximum of
competition, diversity and choice.
A new body, Railtrack, will be set up to run track and signaling. Freight
services will be sold outright. Passenger services will be split into franchises. A
government-appointed money, he will offer subsidies to those who will run them.
Private operators, including companies set up by British Rail managers and staff, will
be able to big for the franchises.
Unanswered question abound. On journeys involving changes of trains, will
one operator accept another’s ticket, and on what terms? How much flexibility will
the individual operator have over fares? How will Railtrack decide train priorities
between fast InterCity trains, slower regional trains and freight? Will freight be
charged the (low) marginal cost of using track, or will it be expected to bear a share
of the basic network costs, which might price it out of business?
Many of these questions will be answered only as the new structure takes
shape. Some American cities are franchising computer services. Services and track
have been split in Sweden; though Swedish Railways has won most of the franchises,
costs have come tumbling down. The Germans are proceeding, slowly, on a similar
basis. The split between track and service providers looks set to spread across the
European Community.
Privatization may take 12 years to complete. If things go well, more
competition may be injected sooner. More lines could be opened up to head-to-head
competition between operators. The track authority itself could be privatized.
But the whole plan does nothing to allow fairer competition between rail and
road. As long as drivers can use overloaded roads at small marginal cost to
themselves, they will remain tempted to travel by car. The answer lines in a system of
road pricing, with vehicles charged for the roads they use and the congestion they
cause.
Ex. 7. Prepare a general discussion on the history of aviation, say what made
planes so popular and how they changed the 20th century way of life.
The history of civil aviation on a large scale started with the end of the Second
World War. Continued technical advances brought rapid improvements in speed,
carrying capacity and comfort. Every part of the globe is now linked by the threads of
the world’s air routes and the spinning of this network of communications has
117
brought about a revolution in world trade and the methods of doing business and
conducting diplomacy.
1960 was an historic year in aviation marking the passage from propeller flight
to the jet era. From that time on the fleet of most airlines of the world was composed
exclusively of jet planes, which allowed them to offer greater passenger and cargo
capacity on long-range routes.
In the early 1980s better plane was designed and made to fully answer the new
demands of civil aviation. The Airbus has a large capacity, essential for management
economy (it can carry 253 passengers and 8.864 kg of cargo) and couples a reduced
fuel consumption with a considerably low noise level.
Ex. 8. Read the following texts and use them as the basis for your interview.
Work in pairs. Discuss telecommunications facilities, their development and
advantages.
Late in the nineteenth century communications facilities were augmented by
another new invention – telephone. In the USA its use slowly extended, and by 1900
the American Telephone and Telegraph Company controlled 855,000 telephones; but
elsewhere the telephone made little headway until the twentieth century. After 1900,
however, telephone installations extended much more rapidly in all the wealthier
countries. The number of telephones in use in the world grew at almost 100 per cent
decade. But long-distance telephone services gradually developed and began to
compete with telegraphic business. A greater contribution to long-range
communication came with the development of wireless. Before the outbreak of the
First World War wireless telegraphy was established as a means of regular
communication with ships at sea, and provided a valuable supplement to existing
telegraph lines and cables. In the next few years the telephone systems of all the chief
countries were connected with each other by radio. Far more immediate was the
influence that radio had through broadcasting and by television, which followed it at
an interval of about twenty-five years.
Ex. 9. Check the knowledge of the terms by rendering the following texts in
English. Make use of the Vocabulary notes.
Появление железных дорог было значительным шагом в модернизации
транспортной системы промышленно-развитых стран. Однако развитие новых
транспортных средств привело к сокращению грузовых и пассажирских
перевозок по железной дороге и к увеличению объемов перевозок
автомобилями и самолетами.
Автомобиль, которому в 1986 году исполнилось 100 лет, стал самым
популярным транспортным средством перевозки как пассажиров, так и грузов.
Повсюду распространение частных легковых автомобилей проходило
медленнее, чем в США; особенно медленными темпами внедрялось
использование грузовых автомобилей для дальних рейсов. Тем не менее объем
дорожного транспорта возрастал стабильно и после второй мировой войны
достиг больших размеров. В целом, в мире число легковых автомобилей
продолжает расти быстрыми темпами.
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Text II. TRANSPORT AND ENVIRONMENT
In recent years the environmental impact of transportation has gained
increasing attention because of some negative environmental aspects associated with
it. These take the form of visual unsightliness (such as waterfronts and railroad freight
yards), noise disturbance, air pollution caused by vehicular emission, water and land
pollution, damage to wildlife habitats and so on. All economic activity adds to
pollution in some way even though we do not always notice it. Transportation, since
it is so universally visible as well as universally necessary, is more noticeable as a
polluter than other activity.
Street, highway, and airway congestion are facts of life and another problem. If
walking is considered a mode of transportation, crowd or people congestion could
also be added. The degree of congestion varies with the size of the city or town, the
location of suburban area relative to the central business district, and the demographic
distribution within the urban area. Traffic, both vehicular and pedestrian, varies by the
time of the day, the day of the week, and the season of the year. Congestion cost time
and money to all users of transportation facilities, it effects the quality of life. The
frayed nerves, the indigestion, the disrupted routine caused by delay – these are costs
to million of users and operators. This is part of the cost of progress.
Vocabulary notes
environmental impact – воздействие на
окружающую среду
unsightliness – неприглядный вид
waterfront – район порта, береговая линия
freight yard – склад для грузов
noise disturbance – шумовое воздействие,
чрезмерный шум
vehicular [vi'hikjulə] – автомобильный,
относящийся к автотранспорту
vehicular emission – выхлопные газы
автотранспорта
to pollute – загрязнять (окружающую
среду)
pollution – загрязнение (окружающей
среды)
air (water, land) pollution – загрязнения
воздуха (воды, суши)
wildlife habitat ['hæbitæt] – место
обитания диких животных
universally – повсеместно, всюду, везде
congestion [kən'dзеst∫ən] – скопление,
перенаселённость,
скучённость,
перегруженность (транспорта)
Comprehension and Discussion Questions
1. What is the environmental impact of transportation and what is being done to
prevent it?
2. What problems does congestion cause?
3. How does transportation effect the quality of life?
Ex. 1. Read the text and do the tasks:
a) Enumerate the environmental problems mentioned in the text.
b) Give derivatives of the word “to pollute” and their synonyms.
c) Explain the meaning of the word “congestion”.
Ex. 2. Translate the following sentences into English in writing. Make use of the
Vocabulary notes, if necessary.
119
a) В последние годы большое внимание уделяется проблемам загрязнения
окружающей среды, особенно воздействию на окружающую среду
транспорта. Имеются в виду такие явления, как чрезмерный шум,
создаваемый авиацией, загрязнение атмосферы выхлопными газами
автотранспорта, загрязнение воды и суши, вред, наносимый транспортом
местам обитания диких животных и так далее.
b) Все виды деятельности способствуют загрязнению окружающей среды,
однако, ущерб, причиняемый транспортом, особенно заметен.
c) Скопление транспорта в городах и районах деловой активности создаёт
ещё одну проблему. Это стоит людям времени и денег, а также
сказывается на их жизни. Расшатанные нервы, нарушенный распорядок
дня и другие, связанные с опозданием транспорта неприятности – вот
плата за услуги миллионов пользователей транспортных средств и тех,
кто ими управляет.
Ex. 3. The extracts below describe the early stage of the development of
transport. Read them and make a comparison with the development of transport
in Africa.
The railway, for more than half a century, was practically unchallenged as a means of
inland transport. From about the time of the First World War it had to meet stronger
competition. Where a good road system was available, or could be created, motor
vehicles became increasingly convenient for passenger journeys. The change was
most evident in the USA, which has consistently had in use a larger number of motor
vehicles than all the rest of the world together and which, by constructing great
transcontinental highways, enabled the motor vehicles to compete for more of the
longest-distance traffic than was practicable elsewhere.
Ex. 4. Basing your answer on the text speak on Japanese car makers in
European market.
The Japanese came to Britain partly for low wage-costs and a welcoming
government, but mostly because it is in Europe. Japanese car makers are laying ever
more stress on European sales. Their traditional markets are taking a knock – home
demand is faltering, American competitors are learning the tricks of lean
manufacture, and Asian competitors grow stronger. Than leaves Europe.
Until 2000, when the EC promise an open market, Japanese imports are
restricted by quota. Britain is a hole in Europe’s defensive wall. Britain has attracted
over 40% of Japanese direct investment in the EC, and the bulk of Japanese car
plants. The plants bring employment, money for equipment and research, and lesson
in the art of manufacturing. Provided the content of cars built in Japanese factories in
Britain is about 80% local, the continental Europeans cannot keep them out. Through
EC demand is expected to fall, output from all Japan’s EC factories should rise by
over 50%.
The Europeans are trying to dam the tide. Japan’s “voluntary” import quotas
have been tightened to offset the growth of the transplants. The European
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Commission persuaded the Japanese government to cut 1993 car imports by 9,4 from
last year, even through it thinks EC demand will fall by only 6,5%.
Ex. 5. Read the following texts and use them as the basis for your interview.
Work in pairs. Discuss telecommunications facilities, their development and
advantages.
The new global satellite-communications systems will offer three kinds of
service, which may overlap in many different kind of receivers:
Voice. Satellite telephones will be able to make calls from anywhere on earth to
anywhere else. That could make them especially useful to remote, third-world
villages (some of which already use stationary satellite telephones), explorers and
disaster-relief standards vary from country to country. So business traveler cannot use
their mobile phones on international trips. Satellite telephones would make that
possible.
Messaging. Satellite messagers have the same global coverage as satellite
telephones, but carry text alone, which could be useful for those with laptop
computers. Equipped with a small screen like today’s pagers, satellite messagers will
also receive short messages.
Tracking. Voice and messaging systems will also tell their users where they are
to within a few hundred metres. Combined with the messaging service, the location
service could help rescue teams to find stranded adventurers, the police to find stolen
cars, exporters to follow the progress of cargoes, and haulage companies to check that
drivers are not detouring to the pub. Satellite systems will provide better positioning
information to anyone who has a receiver for their signals.
Ex. 6. Check the knowledge of the terms by rendering the following texts in
English. Make use of the vocabulary notes.
Автомобиль не был единственным конкурентом железных дорог в
области внутренних перевозок появившаяся в это же время авиация становится
их серьёзным конкурентом в перевозке грузов на дальние расстояния.
Прошедший год стал уже четвёртым годом глубокого кризиса для крупных
авиакомпаний, и очень немногим авиаперевозчикам удалось закончить его с
положительными сальдо баланса (favourable balance).
В борьбе за выживание в условиях экономического кризиса компании
вынуждены менять поведение на рынке. Обычными явлениями стали снижение
тарифов и сокращение рабочих мест. Некоторые компании расстаются со своим
побочным бизнесом (side-line business), чтобы сконцентрироваться на основном.
Однако, иногда именно побочный бизнес может укрепить позиции
авиакомпаний. Так, продовольственное обслуживание авиапассажиров для
некоторых компаний оказалось настолько выгодным, что сейчас многие
компании ведут переговоры о покупке подобной услуги.
Успех деятельности европейских авиакомпаний определяется и уровнем
взаимодействия с другими авиаперевозчиками (air carrier). Особенно актуально
это для национальных компаний стран, которые подвергаются большим
ограничениям на полёты в страны Европейского Союза.
121
Text III. MODERN SYSTEM OF COMMUNICATION
Our world has become an increasingly complex place in which, as individuals,
we are very dependent on other people and on organizations. An event in some distant
part of the globe can rapidly and significantly affect the quality of life in our home
country.
This increasing interdependence, on both a national and international scale, has
led us to create system that can respond immediately to dangers, enabling appropriate
defensive or offensive actions to be taken. These systems are operating all around us
in military, civil, commercial and industrial fields.
A worldwide system of satellites has been created, and it is possible to transmit
signals around the globe by bouncing them from one satellite to an earth station and
thence to another satellite.
Originally designed to carry voice traffic, they are able to carry hundreds of
thousands of separate simultaneous calls. These systems are being increasingly
adopted to provide for business communications, including the transmission of traffic
for voice, facsimile, data and vision.
It is probable that future satellite service will enable a great variety of
information services to transmit directly into the home, possibly including
personalized electronic mail. The electronic computer is at the heart of many such
systems, but the role of telecommunications is no less important. There will be a
further convergence between the technologies of computing and telecommunications.
The change will be dramatic: the database culture, the cashless society, the office at
home, the gigabit-per-second data network.
We cannot doubt that the economic and social impact of these concepts will be
very significant. Already, advanced systems of communication are affecting both the
layman and the technician. Complex function are being performed by people using
advanced terminals which are intended to be as easy to use as the conventional
telephone.
Vocabulary notes
satellite (communication) system – система
связи через искусственные спутники Земли
to transmit signals – передавать сигналы
to bounce from… - отскакивать от…,
рикошетировать
… and thence [дens] to another satellite –
на другой спутник
voice traffic – передача переговоров
transmission – передача, пересылка
facsimile [fæk'simili]
- факсимильная
информация
vision – изображение
satellite service – спутниковая система
связи, связь через спутник
information service – служба информации
electronic mail – электронная почта
convergence – сближение
database – база данных
gigabit-per-second
data
network
–
быстродействующая информационная сеть
layman – непрофессионал, неспециалист
terminal – терминал, выносной пульт ЭВМ
conventional telephone – обычный телефон
Comprehension and Discussion Questions
1. What is the role communications in various fields of our life?
2. Why do you think people are making every effort to improve communications
system?
122
Ex. 1. Read the text and do the tasks:
a) Name communications systems mentioned in the text.
b) Give the contexts in which the word “traffic” is used and translate the
sentences into Russian.
c) Find the terms which are associated with information service.
Ex. 2. Translate the following sentences into English in writing. Make use of the
Vocabulary notes, if necessary.
a) Наш мир стал таким сложным, что мы всецело зависим друг от друга и от
происходящих в этом мире событий. Это заставило людей создавать
системы, которые позволяют быстро реагировать на то, что происходит
вокруг нас. Такого рода системы функционируют во всех сферах
человеческой деятельности: военной, гражданской, коммерческой и
производственной.
b) Была создана система связи через спутники, передающая сигналы по
всему миру. Эта система способна передавать сотни тысяч переговоров
одновременно, она также обеспечивает передачу факсимильной
информации, данных и изображения.
c) Возможно, что в будущем мы сможем получать информацию прямо не
выходя из дома. В основе всей этой системы – компьютер. Не менее
важной является система телекоммуникаций.
d) Сближение обеих систем коренным образом может изменить нашу жизнь.
В результате этого процесса мы получим культуру базы данных,
общество без наличных денег, офис у себя дома и быстродействующую
информационную сеть. Люди будут пользоваться компьютерами так же
легко, как и обычным телефоном.
Ex. 3.
a) Make up English-Russian pairs choosing the suitable equivalents.
1. user; 2. waterfront; 3. vehicular emission; 4. layman; wildlife habitat; 5.
adequate; 7. freight shipper; 8. noise disturbance; 9. convergence; 10.
unsightliness.
1. выхлопные газы автотранспорта; 2. непрофессионал; 3. адекватный; 4.
грузоотправитель; 5. район порта; 6. шумовое воздействие; 7.
неприглядный вид; 8. сближение; 9. пользователь, потребитель; 10.
место обитания диких животных.
b) Make up Russian-English pairs.
1. доступный; 2. срочная пересылка; 3. электронная почта;
4. факсимильная информация; 5. передача переговоров; 6. передавать
сигналы; 7. неприглядный вид; 8. железнодорожная колея;
9. грузовместимость, грузоподъемность; 10. оператор.
1. facsimile; 2. voice traffic; 3. database; 4. accessible; 5. operator; 6. gauge;
7. air express; 8. shipping capacity; 9. to transmit signals; 10. electronic
male.
123
Ex. 4. Give English equivalents of the following:
1. грунтовая дорога; 2. морской транспорт; 3. эксплуатационная скорость; 4.
парк транспортных средств; 5. сеть дорог; 6. функционировать (о дорогах); 7.
доступ к…; 8. перевозка грузов; 9. междугородные автобусные перевозки; 10.
транспортное средство, автомобиль; 11. перевозка грузов автотранспортом; 12.
пассажирские перевозки; 13. загрязнение окружающей среды; 14. скопление,
скучённость; 15. спутниковая система связи.
Ex. 3. The extracts below describe the early stage of the development of
transport. Read them and make a comparison with the development of transport
in Africa.
Shipping suffered far less in the first half of the twentieth century from the
competition of other modes of transport than did the railway. The rapid technical
development of aircraft gave promise that a formidable competitor might eventually
appear, but for many years their high operational cost and small carrying capacity
restricted their commercial effectiveness to a very few classes of traffic. Continued
technical advances brought rapid improvement in their speed, carrying capacity and
comfort. Passenger traffic grew nearly twenty-fold and reached 407,000 million
passenger-kilometres in 1971. Cargo traffic remained on a much smaller scale but
was growing just as quickly, and air services took a high proportion of the
international mail
Ex. 6. Check the knowledge of the terms by rendering the following texts in
English. Make use of the Vocabulary notes.
Во второй половине ХХ века стала развиваться система передачи
информации с помощью искусственных спутников Земли. Современные
спутники могут обеспечить передачу информации по двум телевизионным
каналам и одновременную передачу 12600 телефонных переговоров в
различных частях мира. Предполагают, что к концу этого столетия потребуется
более 150 спутников, осуществляющих новую систему связи, передающую
информацию по 5 телевизионным каналам или по 2000 каналам видеосвязи.
Самое удивительное в передаче программ через космос – это то, что люди
воспринимают их как должное и, вероятно, не подозревают о технических
сложностях системы, которая даёт им возможность получать самые последние
новости с любой точки земного шара.
Ex. 7. Debate on the following topics. Keep the conversation going in a round
table framework.
1. Transport in word economy.
2. The world’s biggest airlines and their routes (British, American, Italian,
Russian, etc.).
3. Automobile in the life of contemporary (rural, urban) dwellers and city
transport.
4. Communications. Telephone, radio, television and video in our life.
5. New projects of transport and communications systems.
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Text IV. THE US TRANSPORTATION
In the economy of the United States the growth of large-scale production in the
nineteenth century was accompanied by the rapid development of the railroad system
plus some development of water transportation. In more recent times, other forms of
transportation have become available and the trend toward large-scale production has
continued. It certainly could not have reached its present advanced stage if it were not
for the presence of an adequate transportation system at reasonable cost to bring in
raw materials, parts, and supplies and to carry the mass-produced products to distant
buyers.
Carriage of freight by highway is a relatively new form of transportation.
Intercity trucking grew rapidly as a result of improvement in vehicles and roads and
the growing demand for the kind of service the motor truck could offer. Like motor
trucking, intercity bus transportation is an important part of passenger traffic though it
has a definite service disadvantage in competing with the private automobile. Its
disadvantage increases with distance when compared with air or rail travel because of
the low speed of buses.
Low speed presents many problems for users. Users of transportation include
freight shipper, receivers and passengers. Among the most important users are
business firms. No wonder that flying has become a common thing. Travel by air has
continued to increase, and today it is the leading type of commercial passenger travel.
Air freight and air express have likewise grown, but remain relatively small in the
total freight carriage picture.
Vocabulary notes
carriage
['kæridз]
–
перевозка,
транспортировка, доставка
carriage
by
rail
(by
sea)
–
железнодорожная (морская) перевозка
carriage of freight [freit] – перевозка
грузов
(motor) truck – грузовик
(motor) trucking – перевозка грузов
автотранспортом
intercity trucking – междугородние
перевозки
vehicle ['vi:ikl] – 1. транспортное средство,
2. автомобиль
intercity
bus
transportation
–
междугородние автобусные перевозки
passenger traffic – 1. пассажирские
перевозки,
2.
объём
пассажирских
перевозок
user [ju:zə] – пользователь, потребитель
freight shipper – грузоотправитель
air
freight
–
груз,
перевозимый
авиатранспортом
air express – срочная пересылка (товаров,
денег) авиатранспортом
Comprehension and Discussion Questions
1. Why do you think transportation is so important for the growth of large-scale
production?
2. What new modes of transportation can you name? What are their advantages
and disadvantages?
3. What most important users of transportation do you know? How are cargoes
transported?
125
Ex. 1. Read the text and do the tasks:
a) Find in the text the word for new modes of transport that came into use in the
twentieth century.
b) Give all the synonyms of the word “carriage”. Explain the difference between
them and illustrate that with your examples.
c) Name the types of passenger transportation. Explain which of them you prefer
and why.
Ex. 2. Translate the following sentences into English in writing. Make use of the
Vocabulary notes, if necessary.
a) В экономике США рост крупномасштабного производства сопровождался
быстрым развитием железных дорог и в некоторой степени развитием
водного транспорта.
b) Новые виды транспорта появились сравнительно недавно. Без них
крупномасштабное производство США не достигло бы такого высокого
уровня. Транспорт доставлял сырьё, запасные части, продовольствие и
увозил продукты массового производства далёкому покупателю.
c) Перевозка грузов автотранспортом сравнительно новый вид
транспортирования грузов. Междугородные авто грузоперевозки быстро
росли благодаря усовершенствованию транспортных средств и дорог, а
также благодаря услугам, которые мог предложить автотранспорт.
d) Подобно авто грузоперевозкам, междугородные автобусные перевозки
являются важной частью пассажирских перевозок, хотя и уступают в
конкуренции частному автомобилю. С увеличением расстояния их
недостатки возрастают из-за низкой скорости по сравнению с воздушным
или железнодорожным транспортом.
e) Одним из ведущих видов пассажирского транспорта в наше время стал
воздушный транспорт. Основными его пассажирами являются
бизнесмены и туристы. Грузовые перевозки по воздуху и срочные
пересылки товаров занимают незначительное место в общем, объёме
грузоперевозок.
Ex. 3. The extracts below describe the early stage of the development of
transport. Read them and make a comparison with the development of transport
in Africa.
Britain was the first country in which a reasonably comprehensive railway
system was created. By the end of 1850, 6,621 miles were in operation, and these
included most of the main routes. Subsequent expansion went on through the
construction of many branch lines, cross links, and short cuts, by a great increase of
suburban lines, and by the addition of one or two more main routes between major
towns. There was at first no conception of a national railway system, and railway
were built and operated by a multitude of independent enterprises.
In some other countries railway development was more systematic partly
because it was possible to benefit from British experience. Wherever they were built,
railway widened the range of possibilities in economic activity.
126
Ex. 4. Basing your answer on the text speak on the Japanese car industry, what
factors favoured its development and what made it so successful and
competitive.
Looking at the fleets of varicoloured cars, lorries and buses rushing from traffic
lights to traffic lights, from one jam to another, it is hard to imagine that Japan
entered the automobile age only some 30 years ago.
The first car appeared there at the turn of the century. It was brought from
abroad as a present to the Emperor. In 1902 a Japanese firm assembled a 12 h.p. car
from imported components and it took another five years for the first all-Japanese car
to be produced at the Tokio Motor Works. Throughout the first quarter of the century
cars remained expensive toys. By 1923 the country had 12,700 cars of which only one
in thirteen was Japanese-made.
On September 1, 1923, an earthquake hit Tokyo and dozens of other big cities
in the Kanto Valley, destroying almost all houses and roads. There was an acute need
for buses and lorries. In the mid-1930s, the government took over the motor industry,
orienting it towards the manufacture of lorries.
By the time of Japan’s capitulation in World War II the motor industry (like
almost all other industries) was virtually non-existent. Acute shortages of fuel and
other raw materials led to a ban on the manufacture of motor vehicles. In 1946 a few
were allowed to be produced, and in 1947, 300 cars. The restrictions were not lifted
until 1949.
1955 is considered the beginning of the automobile age. It was then that the
Japanese engineering industry absorbed billion in American military orders placed
during the Korean war. Motor works were able to new equipment and technology.
The demand for cars rocketed. By 1970 their output had reached 3,2 million a year.
Today Japanese firms sell about 2 millions cars in the US every year. All in all,
exports amounted to 7 million cars. No wonder five Japanese firms are on the list of
the world’s top car producers. Toyota ranks second, just behind General Motors,
Nissan is third, Matsuda ninth, Honda tenth, Mitsubishi eleventh, and Suzuki
fifteenth.
In looking for explanations to Japan’s “motor miracle” on must say that the
situation which took shape in the early 1970s favoured the car companies. Cuts in oil
supplies in 1973 and growing fuel prices forced the manufacturers of uneconomical
cars to adjust to the changed conditions and start developing new models. Meanwhile
consumers did not want to and could not wait. And then the Japanese came along and
offered a whole range of cheap and economical cars. Now Japan accounts for almost
one third of world automobile output. Since 1980, the car industry has been affected
by the general economic stagnation in Japan and other capitalist countries. In 1981
car firms had to introduce “voluntary” quotas on their exports to the US, Canada,
Western Europe, South Korea and Taiwan. As for the domestic market, it is not just
saturated but oversaturated. The automobilization that got under way in Japan in the
mid-1950s became something of an epidemic in the next decade.
Ex. 5. Read the following texts and discuss the situation in the car markets of
Europe and Asia. Use current press material.
127
Sales of new cars in Great Britain slid last year to just 1.6m, from the record
2.3m in 1989. So the motor industry cried for help – and was answered. The rate of
car tax has been cut by half to 5%; taxi operators, car-hire firms and driving schools
get relief from VAT on their vehicles; and capital-allowance limits on business cars
have been raised. Many in the industry reckon all this could boost new car sales this
year by 70,000.
Britain is obsessed with company cars. They account for about 60% of all new
cars sold, a far higher proportion than in any other country. The benefit of a company
car for private use has been taxed more heavily in recent years. This year tax would
rise only in line with inflation.
There will no longer be a VAT penalty on companies that offer employees a
cash alternative to a company car. With an increasing number of two-and three-car
households, thousands of employees may prefer to do without yet another car and
take the money instead. Or they might use the cash to buy their own car – not the new
Ford or Rover offered by most firms, but a second-hand model.
A recommendation has also been adopted taxing company cars on the basis of
their price. At present company cars costing less than $33,000 are taxed on engine
size. This encourages employees to order cars with lots of expensive gadget. Taxing
cars on their value will make company-car drivers a little more fastidious – if they
bother to have a company car at all.
Ex. 6. Prepare a general discussion on problems the world’s aircraft faces now.
More than 1,000 aircraft – about 10% of the world’s entire commercial aircraft
fleet – are now idle. Many are parked in deserts or at the edges of civilian airports.
The newest jets, like Air Canada’s 747s, will be the first back into service when air
travel picks up again. But many of the parked aircraft are more than 20 years old, and
their final flight could be to the breaker’s yard. At least, than is what aircraft
manufacturers hope.
In 1990 the world’s airlines lost a combined $2.7 billion on their scheduled
international services alone, not counting millions more lost on many domestic routes.
Last year the loss on international routes was closer to $4 billion. For the first time
since 1945, air travel actually declined worldwide.
America’s Boeing, the biggest supplier, which usually accounts for about half
the market, is cutting production of its 737, the world’s best-selling jet, from 21
aircraft a month to 14. But, like Europe’s Airbus Industrie and California’s
McDonnell Douglas, its two biggest competitors, Boeing is soldiering on without
changing its production plans for any other models.
Indeed, ambitions still abound. Both Boeing and Airbus are discussing with
airlines the possibility of making a gigantic aircraft, with 600-800 seats. Both are also
trying to lure Japanese aerospace companies to joint them in these multi-billion-dollar
projects. In addition, McDonnell Douglas is talking to Asian companies about taking
a stake in its commercial-aircraft business and jointly developing an aircraft to rival
Boeing’s 747.
Despite the ranks of idle aircraft filling deserts airfields, aircraft makers insist
that lots more aircraft will be needed in the future. Boeing published its long-term
128
market forecast, which predicts that airlines will take delivery of nearly 6,000 new
jets (of all makes) between now and 2000.
Such rosy forecasts assume that world air travel will grow by 5% a year for the
next 20 years. Steady growth at this rate would more than double the size of the airtravel market by 2005. This may not be optimistic as it sounds. Air travel grew by
7%a year between 1970 and 1990. Even if limits on airport capacity restrain growth
in America or Europe, new markets such as Asia, which Boeing expects to grow by
9% a year from now until 2010, could pull up the world average.
Even if passenger volumes grow as rapidly as the aircraft makers predict, it is
unclear on present trends who will provide the gigantic sums of money that airlines
will need to buy all the aeroplanes the aircraft makers hope to sell them. Lots of
financial institutions piled into the market, especially Japanese investors encourages
by tax breaks. But now there is a glut of aircraft. The willingness of Japanese
institutions to put their money into anything with wings has evaporated with the fall
in Japanese share and property values.
Boeing says there will have to be changes in the way aircraft purchases are
financed. It reckons there will be a switch away from banks to international capital
markets to raise the money and that more innovative financing will be developed.
Compared with other industries, such as property, airlines have been slow to employ
the plethora of financing techniques designed by clever brokers and investment
bankers.
Ex. 7. Read the text and exchange opinions on the following problems: (a) the
possible after-effect of the construction of the Channel tunnel on the competition
of various modes of transport in the region; (b) recoupment period of the project
and its worthiness. Make use of current press material.
Signposts on the road to Calais already offer a choice: drivers are directed to
the ferries, the hoverport or the catamarans. Another set of signs remains covered.
These points to the almost-complete tunnel under the sea between France and Britain.
This will be officially opened on May 6th next year. Once its novelty wanes, the
tunnel could face a perilously lean time.
Eurotunnel, the Anglo-French company with the franchise to operate the link
until 2042, has been forced to do its sums yet again. It revised downwards its estimate
of revenue while increasing its projected costs. The group now needs to raise at least
another $1.5 billion from its banks and shareholders, taking the total cost of the
project to $15 billion by 1998, when the tunnel is expected to start to break even. The
cost is now more than twice the original estimate given in 1987.
The project has been mired by rows with construction companies and by
disputes with the suppliers of the shuttle trains that will be used to carry both
passengers and cars through the rail-only tunnel in about 35 minutes. Through-trains
running from London to Paris and Brussels will also use the tunnel. An extension of
the French high-speed railway has already been completed to Calais. But, at the other
end, the trains will have to share the line to London with slow commuter services
until a controversial route for a new high-speed link can be agreed on – and financed.
129
Being late and over budget is hardly surprising for such a huge civilengineering project. The first plans for a tunnel under the English Channel were
drawn up in 1802 by one of Napoleon’s engineers to invade England while a fleet
sailed above. Unfortunately for Eurotunnel, another fleet is now gathering at the ports
of Dover and Calais. Far from being frightened and switching their ship to other
routes, the ferry operators are concentrating their resources to complete directly with
the tunnel.
Eurotunnel’s chief executive, has cut the estimate of Eurotunnel’s revenues in
its first three years by $141m to about $2,25 billion. What those earnings eventually
turn out to be will depend on how Eurotunnel sets its prices.
In theory, the Channel tunnel should wipe the ferries out in any price war. The
strongest argument in Eurotunnel’s favour (although hardly one it is likely to talk
about) is that a price war is not in the interests of the ferries either. If the tunnel went
bust, it would not be put out of business. It is confident the ferries could retain half
the market, partly because in its first year Eurotunnel’s own capacity will be limited.
When the real battle for market share begins, the ferries might be allowed to team up.
This would not help to make Eurotunnel rich. Unlike the ferries, Eurotunnel
will be able to tap the air-travel market. A three-hour journey by train from central
London to central Paris will be a big attraction to people who would otherwise fly
between the two cities. There is a snag with that – as hundreds of Britons every day
learn of their cost. To take on the airlines. Eurotunnel will have to wait for British
Rail to get its act together. Even with the government sharpening British Rail up for
privatization, that could be a long wait.
Ex. 8. Read the following texts and use them as the basis for your interview.
Work in pairs. Discuss telecommunication facilities, their development and
advantages.
Telephones are as much a form of infrastructure as roads or electricity, and
competition will make them cheaper. Losses from lower prices will be countered by
higher usage, and tax revenue will benefit from the faster economic growth that
telephones bring about. Most important of all, by cutting out the need to install costly
cables and microwave transmitters, the new telephones could be a boon to the remote
and poor region of the earth. Even today, half the world’s population lives more than
two hour away from a telephone, and that is one reason why they find it hard to break
out of their poverty. A farmer’s call for advice could save a whole crop; access to a
handset could help a small rural business sell its wares. And in rich places with
reasonable telephone systems already in place, the effect of new entrants – the
replacement of bad, overpriced services with clever, cheaper ones – is less dramatic
but still considerable.
Global phones are not going to deliver all these benefits at once, or easily.
Indeed, if the market fails to develop, it could prove too small to support the costs of
launching satellites. Still, that is a risk worth taking. And these new global telephones
reflect a wider trend. Lots of other new communication services – on-line film
libraries, personal computers that can send video-clips and sound-bites as easily as
they can be used for writing letters, terrestrial mobile-telephone system cheap enough
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to replace hard-wired family sets – are already technically possible. What they all
need is deregulation. Then any of them could bring about changes just as unexpected
and just as magical as anything that Alexander Graham Bell’s telephone has already
achieved.
Ex. 9. Check the knowledge of the terms by rendering the following texts in
English. Make use of the Vocabulary notes.
Сингапур приступил к испытаниям электронной системы, которая будет
взимать плату с автомобилистов за пользование улицами Сингапура –
аналогично тому, как сейчас взимается плата за воду или за электричество.
Идея состоит в том, что в каждом транспортном средстве имеется
устройство, в которое вставляется специальная карточка. Всякий раз, когда
автомобиль
пересекает
электронный
контрольный
пост,
детектор
автоматически «снимает» с карточки владельца плату за пользование данной
дорогой. В настоящее время рассматриваются три вида оплаты: пошлина за
въезд, плата за километраж и плата, зависящая от степени интенсивности
дорожного движения на данном участке
Как полагают, новая система, которая должна быть принята в
эксплуатацию после 1996 года, станет первой в своём роде. В испытаниях будут
использоваться различные типы транспортных средств (легковые автомобили,
автобусы, грузовики и мотоциклы) на различных скоростях, в различных
погодных условиях и при различной интенсивности дорожного движения.
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UNIT XIII
Text I. TESTING THE MARKET-FINDING OUT
The first step you take as a potential exporter, before spending time, effort and
money on trying to develop overseas sales, is to establish that there is such a demand
for your product. Whether you wish to sell goods or services, it is still vital to
establish that an overseas market does actually exist.
It is not generally difficult to find out the overseas market prospects for a
product. If your company has a showroom or has been promoting its products at trade
fairs, exhibitions and seminars in the UK, you will probably already have had some
contact with overseas buyers and other foreign visitors. You should have kept
yourself informed of the UK market for your product by reading the relevant sections
of the trade press. Doing so will probably have given you a good idea if there is some
interest in your type of product overseas.
Where to find information and advice
Once you have decided through reading, talking and listening to other people
that there are export possibilities for the company’s products, then is the time to
assess the prospects more systematically. A good start can be made by consulting
relevant books and publications in addition to making contact with people who
already know the overseas market for your particular product. The central libraries in
most major towns and even smaller local libraries will stock many trade and product
journals and directories. The Statistics and Market Intelligence Library also provides
detailed import and export statistics by each individual country.
In all likelihood there will be a trade association which your company can join.
This will undoubtedly have an export committee which can give advice on the
potential markets you are interested in. It is probably that companies with products in
the same commercial or industrial sector, and who are already exporting, will give
advice on export market opportunities. This is, of course, providing that your products
would not be competing for the same business as theirs.
The British Overseas Trade Board (BOTB) gives excellent advice on export
market opportunities. You would be well advised to make contact with your local
regional office to obtain as much specific information as possible. The Export
intelligence Service (EIS) of the BOTB also publishes information regularly on a
wide variety of export opportunities in many overseas markets.
Other sources of information include the international division of the major
clearing banks and local Chambers of Commerce which have an export information
service. As part of this desk research it is helpful to draw up a questionnaire detailing
the information required to establish whether or not there are markets abroad which
will purchase your product. This question and answer process of analysis helps to
introduce a systematic approach, which is essential for success.
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Vocabulary notes
overseas – заморский
relevant – относящийся к делу, нужный
to assess – оценивать, определять
particular – особенный, конкретный
providing that – при условии, что…
likelihood – вероятность
1.
2.
3.
4.
5.
to stock – комплектовать
directory – справочник
to draw up – составить
questionnaire – анкета
to purchase – закупать
approach – подход, политика
Comprehension and Discussion Questions
What is the first step in testing the market-finding out?
What is the best way to promote your product?
What are the concrete ways of finding the overseas market for your particular
product?
Can any organizations or banks give you a positive advice on export market
opportunities?
What final arrangements should you make for the successful market-finding
results?
Practical Task:
Read through the text and find sentences with the Passive Infinitive forms and
Gerunds write them out and translate the sentences into Russian.
Text II. FACTORS TO BE CONSIDERED BEFORE DECIDING TO EXPORT
Once it has been determined that there are opportunities for profitable sales in
overseas markets, the next step is to take an overall view of how a decision to move
into the export market will directly affect your company’s existing domestic
commitments and future plans. You will find that you now need to look at the
practical implementation of the information your research has uncovered in order to
develop a proper export strategy.
This is vitally important if you are to become an effective international trader,
even if your initial intention is to develop business only in neighbouring EEC
markets. Too many companies drift into exporting and then find themselves in
difficulties, particularly in the areas of meeting different specifications and delivery
dates and financing their overseas customers’ credit.
The global market for suitable products and services is obviously much larger
than the UK market. Therefore companies successful in exporting often find that their
overseas trade becomes the dominant part of their business, and when this happens
everyone in the company is affected. They then need to think in terms of the
worldwide market, the different requirements of each separate area of that market and
the effect exporting will have on the part of the business they control.
How will existing resources be affected?
As a director or owner of a small business your main concern will be the need
to manage the finances of your company efficiently and profitably. If your company
is “market-led”, then market strategy should be given at least the same importance as
133
financial strategy in boardroom discussions. The impact of an export marketing
strategy on every function in your business must also be considered.
Part of your responsibility must be to examine the resources which are
available and necessary to support export sales and estimate their effect on cashflow
and working capital. It may be necessary to make a financial investment in order to
develop and establish overseas sales. For example, initial visits to overseas markets,
participation in international trade fairs and exhibitions, and the preparation of
literature and so on for each will require an “up-front” financial commitment. You
will control the granting of credit, decide on payment terms and the management of
credit insurance. If you intend to sell on open account in local currency, on a
delivered basis – for example in France – then responsibility for determining the
credit status of potential customers also has to be determined.
You will have to arrange meeting with the international division of your
company’s bank, and agree on the handling of currency exchange problems and
possible credit insurance. If cashflow is likely to be a problem in the initial stages of
market development, then an increased loan may also be required. The possibility of
discounting bills, factoring of debts and forfeiting should all be considered. The
advantage of factoring is that the factoring company will be responsible for collecting
payments from customers. It will also guarantee payment in sterling less an agreed
percentage of the fee.
If you are exporting capital goods, then forfeiting should be considered. By this
method the total amount owed by your customer is sold to the forfeitor for a discount.
As an exporter you are paid immediately and the forfeitor collects the money owed
from your buyers.
Payment by Irrevocable and Confirmed (by reputable international bank)
Letters of Credit or by avalised (guaranteed by customer’s bank) Bills of Exchange
are other ways to make reasonably sure of receiving payment when it falls due. Both
documents can be discounted for cash after acceptance by the bank if they are for
payment after a credit period. It is essential that you familiarize yourself with all the
financial aspects of exporting so that you can take these factors into consideration
when planning marketing strategy.
All aspects of your company’s business will be affected by the decision to enter
the export market. An evaluation of all the company’s resources is essential to
determine whether or not it has the capability to enter the export market. The first
need is either to develop in-house expertise to handle export marketing and
documentation, or to employ an export specialist to assist in both these crucial areas.
If the knowledge and skills are already available amongst existing staff, then you are
very fortunate. It is also useful to identify any foreign language skills, both written
and verbal, possessed by your staff since such skills are likely to be required as
business develops.
Vocabulary notes
to determine – определить
overseas markets – заморские, внешние
рынки
profitable sales – доходные продажи
to affect – влиять
commitments – обязательства
134
vitally important – жизненно важно
to drift – плыть по течению
suitable – подходящий, нужный
requirements – требования
market-led – ориентированная на рынок
boardroom – комната совета, совещания
responsibility – ответственность
available – имеющийся в наличии
to support – поддерживать
to estimate – оценивать
advantage – преимущество
1.
2.
3.
4.
5.
6.
7.
8.
factoring – посредничество
forfeiting
–
наложение
штрафа,
конфискация
irrevocable Letter of Credit – безотзывный
аккредитив
reputable – уважаемый, надёжный
confirmed – подтверждённый
essential – существенный
evaluation – оценка
capability – способность
Comprehension and Discussion Questions
What are the first steps in order to develop a proper export strategy?
What are the threats and difficulties of drifting into exporting?
Why do companies successful in exporting find their overseas trade the
dominant part of their business?
The market and finance strategies are very important in boardroom discussions,
aren’t they?
What is your responsibility in supporting export sale?
Why do you have to arrange meeting with the international division of your
company’s bank?
What do you think of the importance of cash flow and loan in the process?
Do you need an expert specialist to evaluate the goods or the knowledge and
skills of your staff?
Practical Task:
Read through the text, write out the Simple (Indefinite) and Passive Infinitives
and translate the sentences into Russian.
Text III. EXPORT AND IMPORT OPERATIONS
Once of the biggest impediments to exporting is ignorance of foreign market
opportunities.
Neophyte exporters often become discouraged or frustrated with the exporting
process because they encounter many problems, delays, and pitfalls.
The way to overcome ignorance is to gather information. In the United States a
number of institutions, most important of which is the U.S. Department of
Commerce, can help firms gather information and in the matchmaking process.
Export management companies can also help an exporter to identify export
opportunities.
Many of the pitfalls associated with exporting can be avoided if a company
hires an experienced export management company, or export consultant, and if it
adopts the appropriate export strategy.
Firms engaged in international trade must do not business with people they
cannot trust, people who may be very difficult to track down if they default on an
135
obligation. Due to the lack of trust, each party to an international transaction has a
different set of preferences regarding the configuration of the transaction.
The problems arising from lack of trust between exporters and importers can be
solved by using a third party that is trusted by both-normally a reputable bank.
A letter of credit is issued by a bank at the request of an importer. It states the
bank promises to pay a beneficiary, normally the exporter, on presentation of
documents specified in the letter.
A draft is the instrument normally used in international commerce to effect
payment. It is an order written by an exporter instructing an importer, or an importer’s
agent, to pay a specified amount of money at a specified time.
Drafts are either sight drafts or time drafts. Time drafts are negotiable
instruments. A bill of lading is issued to the exporter by the common carrier
transporting the merchandise. It serves as a receipt, a contract, and a document of
title. U.S. exporters can draw on two types of government-backed assistance to help
finance their exports: loans from the Export-Import Bank and export credit insurance
from the Foreign Credit Insurance Association (FCIA).
Counter trade includes a whole range of barter like agreements. It is primarily
used when a firm exports to a country whose currency is not freely convertible and
who may lack the foreign exchange reserves required to purchase the imports.
The main attraction of counter trade is that it gives a firm a way to finance an
export deal when other means are not available. A firm that insists on being paid in
hard currency may be at a competitive disadvantage vis-à-vis one that is willing to
engage in counter trade. The main disadvantage of counter trade is that the firm may
receive unusable or poor-quality goods that cannot be disposed of profitably.
Vocabulary notes
impediment – преграда, задержка
neophyte
exporter
–
начинающий
экспортёр
pitfall – ловушка
matchmaking process – выбор партнёра
international transaction – международная
операция
letter of credit – акредитив
draft – переводной вексель
bill of lading – коносамент
1.
2.
3.
4.
5.
merchandise – сбыт товара
government-backed assistance – помощь
при поддержке правительства
beneficiary – владелец бенефиции или
фонда
counter trade – бартер, обмен товарами
(без получения денег)
FCIA
(Foreign
Credit
Insurance
Association) – Страховая ассоциация
внешних кредитов
Comprehension and Discussion Questions
What is one of the biggest impediments to exporting?
Why do neophyte exporters often become discouraged with the exporting
process?
How can export management companies help an exporter?
What are the requirements both to an experienced export company and to an
exporter?
How can the problems arising from lack of trust between exporters and
importers be solved?
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6. What is letter of credit?
7. What order is a draft?
8. What does a bill of lading serve as?
9. What are two types of government-backed assistance?
10.What does a counter trade include?
11.What are advantages and disadvantages of the counter trade?
Ex. 1. Match the Russian terms with their English equivalents.
A
B
l) коносамент
1. foreign market opportunities
m) доверие
2. neophyte exporter
n) начинающий экспортёр
3. letter of credit
o) консультант с экспорта
4. trust
p) ловушка
5. delay
q) акредитив
6. obligations
r) обязательства
7. draft
s) переводной вексель
8. bill of lading
t) задержка
9. export consultant
u) благоприятная возможность для
10.pitfall
внешнего рынка
Ex.2. Translate the following sentences into English using key terms given in
Ex.1.
1. Начинающий экспортёр часто разочарован процессом экспорта, потому
что он встречается со многими проблемами, задержками и ловушками.
2. Много ловушек, которые связанные с экспортом, можно избежать, если
компания наймет опытную экспортную компанию по вопросам
менеджмента или консультанта по экспорту.
3. Через отсутствие доверия каждая сторона международного соглашения
имеет равные преимущества в соответствии с видом соглашения.
4. Проблемы, которые возникают через отсутствие доверия между
экспортёрами и импортёрами, могут быть решены третьей стороной,
которой доверяют как экспортёры, так и импортёры, например, банком,
который имеет хорошую репутацию.
5. Аккредитив выдаётся банком по просьбе импортёра.
6. Переводной вексель – это инструмент, который используется в
международной торговле для того, чтобы произвести оплату.
7. Основным преимуществом бартерной торговли есть то, что она даёт
способ финансирования экспортного соглашения, когда другие способы
недоступны.
Ex.3. Read the following sentences and write out Participle ІІ. Translate the
sentences into Russian.
1. Neophyte exporters often become discouraged or frustrated with the exporting
process.
137
2. In the United States one of the most important institutions is U.S. Department
of Commerce.
3. Many of the pitfalls associated with exporting can be avoided if a company has
an experienced export management company.
4. It is an order written by an exporter instructing an importer to pay a specified
amount of money at a specified time.
Ex. 4. Translate the following sentences into English paying attention to the
functions of Present and Past Participle.
1. Министерство торговли США может помочь фирмам собрать необходимую
информацию и поощрить клиента.
2. Фирмы, которые заняты в международной торговле, иногда должны иметь
дело с клиентами, которым они доверяют.
3. Акредитив устанавливает, что банк обязан уплатить экспортёру при наличии
указанных в нём документов.
4. Переводной вексель выписывается экспортером для передачи инструкции
импортёру относительно выплаты указанной суммы в определённое время.
5. Экспортёры Соединённых Штатов могут рассчитывать на два вида помощи
со стороны правительства.
6. Фирма, которая настаивает на оплате в твёрдой валюте, может потерять
клиента.
Ex. 5. Read the new words and try to memorize them.
1. transaction
операция
2. to ship
транспортировать
3. shipment
транспортирование
4. merchandise
товары, сбыт товара
5. carrier
транспорт
6. time draft
отсроченный переводной вексель
7. to endorse
расписываться на обороте документа, подтверждать
8. to take possession
приступать к владению
9. maturing draft
переводной вексель о сроке
10. matured acceptance
получение векселя о сроке платежа
TYPICAL INTERNATIONAL TRADE TRANSACTION
Now that we have reviewed all the elements of an international trade
transaction let us see how the whole process works in a typical case, sticking with the
U.S. exporter and the French importer. The typical transaction involves 14 distinct
steps. The steps are enumerated here.
1. The French importer places an order with the U.S. exporter and asks the
American if he would be willing to ship under a letter of credit.
2. The U.S. exporter agrees to ship under a letter of credit and specifies relevant
information such as prices and delivery terms.
138
3. The French importer applies to the Bank of Paris for a letter of a credit to be
issued in favor of the U.S. exporter for the importer wishes to buy.
4. The Bank of Paris issues a letter of a credit and sends it to the U.S. exporter’s
bank, the Bank of New York.
5. The Bank of New York advises the U.S. exporter of the opening of a letter of
credit in his favor.
6. The U.S. exporter ships the goods to the French importer on common carrier.
An official of the carrier gives the exporter a bill of lading.
7. The U.S. exporter presents a 90-day time draft drawn on the Bank of Paris in
accordance with its letter of credit and bill of lading to the Bank of New York.
The U.S. exporter endorses the bill of lading so title to the goods is transferred
to the Bank of New York.
8. The Bank of New York sends the draft and the bill of lading to the Bank of
Paris. The Bank of Paris accepts the draft, taking possession of the documents
and promising to pay the now-accepted draft in 90 days.
9. The Bank of Paris returns the accepted draft to the Bank of New York.
10.The Bank of New York tells the U.S. exporter that it has received the accepted
bank draft, which is payable in 90 days.
11.The exporter sells the draft to the Bank of New York at a discount from its face
value and receives the discounted cash of the draft in return.
12.The Bank of Paris notifies the French importer of the arrival of the documents.
She agrees to pay the Bank of Paris in 90 days. The Bank of Paris releases the
documents so the importer can take possession of the shipment.
13.In 90 days the Bank of Paris receives the importer’s payment, so it has funds to
pay the maturing draft.
14.In 90 days the holder of the matured acceptance (in this case, the Bank of New
York) presents it to the Bank of Paris for payment. The Bank of Paris pays.
1.
2.
3.
4.
5.
6.
7.
Comprehension and Discussion Questions
What is the first step involved in the typical transaction?
Does an exporter or importer agree to ship under a letter of credit?
What does the bank of New York advice the US exporter?
What is the term of the time draft of the US exporter?
What bank notifies the French importer of the arrival of the draft?
When does the Bank of Paris have funds to pay the maturing draft?
What is the last step in the typical transaction?
Text IV. EXPORT AS AN IMPORTANT PART OF FOREIGN TRADE
Every country, regardless of size, ideology, or state of development,
participates in international trade. Trade theorists have tried to explain why states
trade and how they benefit from it largely under assumptions of static conditions that
hold all domestic factors of production (land, other natural resources, labor, and
capital) in fixed supply. The resulting theory of comparative advantage is rich in its
implications about the gains from trade, the following among them: (1) Any country
139
can increase its income by trading, because the world market provides an opportunity
to buy some goods at relative prices that are lower than those which would prevail at
home in the absence of trade. (2) The smaller the country the greater this potential
gain from trade, but all countries benefit to some extent. (3) A country will gain most
by exporting commodities that it produced, using its abundant factors of production
most intensively, while importing those goods whose production would require
relatively more of the scarcer factors of production.
The theory of comparative advantage is posed here in the very simple form
developed by David Ricardo during the nineteenth century: two countries, two goods,
and only one factor of production, labor. Some of the complexities of the real world
can be incorporated into the theory, however. A trading world of many countries can
be handled by taking the home country, say Kenya, and treating the rest of the world
as its trading partner. The Swedish economists Eli Heckscher and Bertil Ohlin during
the first half of the twentieth century expanded the theory to deal with two factors,
such as labor and capital.
Before trade, a country both produces and consumer at a point like A. With
trade, a country produces at a point like B and can increase its consumption of both
goods and move to a higher indifference curve at C.
We divided the economy into production of X goods and Y goods, without
being specific about the nature of those goods. In Figure 1, the economy of our home
country is divided instead into exportable goods, such as rice, that are produced using
relatively land- and labor-intensive methods, and importable goods, such as cloth,
produced using relatively capital-intensive methods. As shown in the diagram, the
home country is relatively well-endowed with land and labor, so the production
frontier is skewed to the right; this depicts the country’s greater capacity to produce
rice than cloth. The country’s collective utility in consuming these goods is
represented by the community indifference curves.
Without trade, the home country achieves its greatest utility by producing and
consuming at point A, the tendency of the indifference curve I and the production
frontier. The slope at A determines the domestic relative price of rice in terms of
cloth. Assume that the rest of the world is better endowed with capacity than with
labor and land relative to the endowments of the home country and that world
consumers have tastes broadly similar to those of the home country. Then on world
markets the relatively higher production of cloth compared with the demand for cloth
will drive its price lower than in the home country. Since only relative prices matter,
these two statements mean the same thing: in world markets the price of rice in terms
of cloth will be higher than in the home country.
TEST I
Choose the correct word. Only one word is correct. Fill in the following gaps.
1. Mechanisms for financing exports and imports have evolved in response to a
problem: … of trust.
a) abundance
b) lack
c) amount
d) costs
140
2. … seen the letter of credit, the US exporter ships the products to France.
a) to be
b) having
c) being
d) done
3. Title to the products is given in the bank in the form of a document called a bill of
...
a) credit
b) trust
c) investment
d) lading
4. In return the US exporter tells the bank … for the products, which the bank does.
a) to pay
b) to ship
c) to manage
d) to sell
5. The documents for requesting this payment is referred to as a … .
a) assignment
b) draft
c) visa
d) bill
6. The bank, … for the products, passes the title on to the French importer, whom the
bank trust.
a) being paid
b) to have paid
c) having paid
d) have been paid
7. At the time or later, … on their agreement, the importer reimburses the bank.
a) to be depended
b) to depend
c) depending
d) to have depended
8. A letter of credit, abbreviated as L/C, stands at the center of international
commercial … .
a) transaction
b) assignments
c) drafts
d) letters
9. The letter of … states the bank will pay a specified sum of money to a beneficiary,
normally the exporter, on presentation of particular, specified documents.
a) drafts
b) assessment
c) credit
d) payment
10. The French importer applies to the local bank for … of a letter of credit.
a) assurancing
b) issuance
c) giving
d) representing
11. The local French bank undertakes a credit check of the … .
a) exporter
b) importer
c) bank
d) layer
12. If the French bank is satisfied with its creditworthiness, it will issue a letter of … .
a) credit
b) lading
c) intent
d) condolence
13. In addition the French bank will charge the importer a … for this service.
a) fee
b) fine
c) credit
d) tax
14. Typically this amounts to between 0,5 percent and 2 percent of the value of the
letter of credit, … on the importer’s creditworthiness and the size of the transaction.
a) to have depended
b) depending
c) to be depended
d) had depended
15. If the French bank is satisfied with the French importer’s creditworthiness it will
… a letter of credit.
a) print
b) issue
c) accuse
d) purchase
141
16. The letter stares the French bank will pay the U.S. exporter for the … so long as it
is shipped in accordance with certain specified instructions.
a) merchandise
b) credit
c) check
d) bell
17. At this point the letter of credit becomes a financial … between the French bank
and the U.S. exporter.
a) sum
b) contract
c) requirement
d) measure
18. The French bank … the letter of credit to the U.S. exporter’s bank.
a) pays
b) returns
c) sends
d) performs
19. The U.S. bank tells the exporter it has received a letter of credit and he can … the
merchandise.
a) attracts
b) ship
c) applies
d) approves
20. After the exporter has shipped the merchandise, he draws a … to the French bank.
a) letter
b) draft
c) money
d) approval
21. The exporter attaches the required documents and presents the draft to the U.S. …
for payment.
a) government
b) office
c) bank
d) agent
22. The U.S. bank forwards the letter of credit and associated documents to the …
bank.
a) American
b) French
c) European
d) World
23. When the U.S. bank receives the funds, it will pay the U.S. … .
a) exporter
b) importer
c) layer
d) the third person
24. Once the French bank has transferred the funds to the U.S. bank, it will collect …
from the French importer.
a) documents
b) payment
c) draft
d) credit
25. Alternatively the French bank may allow the importer some time to resell the …
before requiring payment.
a) ship
b) product
c) merchandise
d) documents
26. The great advantage of this system is that both the French importer and the U.S.
exporter are likely to … reputable banks.
a) trust
b)visit
c)carry
d) solve
27. An exporter may find that … a letter of credit will facilitate obtaining pre-export
financing.
a) being
b) to have been
c) having
d) having been
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28. … the letter of credit, the U.S. bank might be willing to lend the exporter funds to
process and prepare merchandise for shipping to France.
a) to have seen
b) having seen
c) to be seen
d) being seen
29. International practice is to use … to settle trade transactions.
a) selling
b) baying
c) paying
d) credit
30. Switch trading refers to the use of specialized … trading houses in a countertrade
arrangement.
a) importer
b) exporter
c) third-party
d) managing
31. Even when counter trade is not the only option for structuring an export … many
countries prefer counter trade to cash deals.
a) transaction
b) purchase
c) merchandise
d) deal
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UNIT XIV
Text I. OPENING UP EXPORT MARKETS
Once you have selected your overseas market, how do you go about developing
it? What steps should you take to obtain sales? Of course, it is possible to try and sell
direct to potential customers either by using mail-shots or by advertising in
appropriate journals. These methods are not normally effective, however, unless
combined with other marketing activities, such as visiting the market yourself or
appointing local agents or distributors. Potential customers are not likely to be willing
to order a product from a manufacturer they have never heard of, situated hundreds or
possibly thousands of miles away, if there is no local representatives to sort out any
problems that may arise. Direct mail campaigns to overseas markets need to be
coordinated with on-the-spot action.
Some kind of sales network must also be set up, and the following options are
those which you will need to consider:
Regularly visiting the market yourself;
Sending out a member of your sales staff;
Using export merchants or export managers in the UK;
Appointing local agents or distributors;
Setting up a branch sales office abroad;
Licensing a local firm to produce goods to your company’s design;
Establishing a subsidiary or associate company abroad with its own
manufacturing and marketing divisions.
Let us now look at these possibilities in more details, to ensure that you make
the right decision for your company.
It is certainly advisable to visit the overseas market, but not really practical to
rely on this as a sole selling method. For the more complex type of transaction, the
customer may expect to see you as you will be able to make immediate decisions
about prices and delivery dates.
This is only a realistic possibility if you can afford to have this salesperson in
the overseas market for several months each year. Such a salesperson should report
back on a weekly basis, but must also have sufficient knowledge and authority to
answer questions and make on-the-spot decisions.
Export merchants/ confirming houses/ commission agent in the UK operate in
various ways, often under the same roof. They buy goods outright and sell on their
own behalf, confirm orders received from abroad (i.e. take care of the financial
arrangements) and arrange shipment and insurance for the overseas buyer. Most
specialize in particular overseas markets and/ or goods. A development of this
approach is the export management company. They act as the manufacturer’s own
export department, taking care of every aspect of the procedure from trying to locate
potential customers, through arranging suitable payment terms, to shipping and
documentation. These firms will handle the products of a number of small
manufacturers. There are also buying offices in London which specialize in
purchasing goods suitable for departments and chain stores located in the USA and a
number of other countries.
144
There are obvious advantages in using a UK-based export agent or merchant.
You are dealing with a business located in the same country as yourself. It can handle
packing if necessary, arrange shipment and would normally prepare any special
export documents which might be required. However, you must also consider the
main disadvantage that you, the manufacturer, are not in direct touch with the
customer and therefore have much less control. In the long-term this may prove
totally unacceptable, although it can work for makers of standard items such as
hardware, fasteners, tools and consumer goods.
Appointing a local agent or distribution is the most common method of opening
up an export market. There are two principal types:
the commission agent who will book orders on your behalf, with you issuing
invoices direct to the customer;
the importer/ distributor, who will buy from you on his own account and then
fix his own price levels.
Vocabulary notes
appropriate – соответствующий
on-the-spot action – действие на месте
to appoint – назначить
subsidiary – дочерний
to rely on – полагаться
advisable – желательный
to afford – позволять, иметь возможность
immediate – немедленный, срочный
outright – прямо, тотчас же
on their own behalf – от собственного
имени
1.
2.
3.
4.
5.
6.
7.
purchasing goods – оптовая закупка
товаров
obvious – очевидный
to handle – управлять, организовывать
hardware – скобяные изделия
fasteners – задвижки, застёжки
to issue invoices – готовить, издавать
коносамент
on one’s own account – на собственный
счёт
Comprehension and Discussion Questions
In what way do we obtain sales?
What is the market behaviour of potential customers?
What kind of sales network should be set up for the effective marketing?
What is a sole selling method for overseas marketing?
Why should we have a chartist (salesperson) in the overseas market?
How do the UK commission agents operate in overseas marketing?
What is the main disadvantage of a manufacturer in overseas marketing?
ARRANGING BUSINESS VISITS
Once a decision has been made about the most suitable type of overseas sales
network, you will then have to consider how to support your agent, distributor or
branch office, principally by making personal visits to them. Such a visit can be either
on your own or with a trade mission organized by a body such as a Chamber of
Commerce or Trade Association, which may be sponsored by the BOTB.
Visits are necessary because personal contract with agents and customers is
most important. Even if you do not speak the language fluently, one or two words
145
will go a long way to ease negotiations. Preparation is essential, including desk
research on the market. Notification to your local BOTB office is recommended so
that they can advise their overseas post, who in turn will prepare lists of contracts for
you. Your local Chamber of Commerce can help in the same way, by writing in
advance to their counterparts in the overseas markets.
Check on public holidays, local industrial holidays, social customs, travel and
health requirements and similar mundane but important points. You will find the
Hints to Exporters’ booklets very useful as sources for such information. They are
provided free of charge to exporters by the BOTB.
Once these preparations have been made advise your agent and existing and
potential customers of your intended visit. It is also a good idea to send them leaflets
in their own language, but the actual translation must be undertaken by someone
whose language is the mother tongue, in order to achieve the desired effect.
Whilst these comments will generally apply to all kinds of business trips, sales
missions organized by your local Chamber of Commerce will mean a slightly
different approach. If you contemplate joining such as a mission, much of the
preliminary spade-work will be done by the organizers and the British posts abroad.
For a beginner, therefore, this can be a very much easier way of entering the export
market. For example, in 1986 Birmingham Chamber of Commerce and Industry sent
out 13 missions to 18 countries and brought back orders worth 71 million.
There are several obvious advantages to being part of such an outward sales
mission. Contracts are arranged for you with potential customers or agents; the
mission and its members are given publicity overseas in newspapers, magazines, TV,
and so on; you are with people who know the market and can give advice if problems
occur and finally, but not least important, you may be eligible for a grant towards the
cost.
The availability of such grants depends on the country involved. At the present
time BOTB subvention is not available for missions to USA and Canada, South
Africa and Western Europe (excluding Spain, Portugal, Iceland and Finland). For
those areas where financial assistance is not provided there may still be Chamberorganized trips, where the other advantages still hold good.
CHANNELS OF COMMUNICATION
As we have seen, communication with agents or customers is all important. If
they do not hear from you regularly they will feel isolated and more inclined to
promote their other lines. But apart from the postal services, what other methods of
communication are open to you? In this electronic age, it may be easier to make
contract by telex and facsimile transmission. Many firms overseas actually prefer
these methods since they provide instantaneous hard copies of the information being
transmitted and avoid potential postal delays. For those companies who do not have
their own telex and fax facilities, agencies exist which offer these services on a
subscription basis. They can be found in your local Yellow Pages under Telex
Bureaux or Office Services. Fax is rapidly catching up with telex in popularity. It is
now being used to send letters and other written documents and not, as in the past,
146
just drawings and specifications which could not be transmitted on a telex machine.
The cost involved in using either method is roughly comparable.
Should you need to telephone your agent, to remember to check the time
difference, bearing in mind British Summertime and any similar daylight-saving
scheme in the overseas country involved. Do not forget potential language problems.
Arrange for a linguist to be on hand if the person whom you are telephoning is not
fluent in English.
You will undoubtedly also need to use postal communications and purchasing a
copy of the Post Office Guide will prove a good investment. This is a comprehensive
directory of all the available postal services, including notes on sending letter and
parcels abroad, cash-on-delivery, insurance, and so on. If you need to send literature
or small samples through the post this guide is essential reading.
Vocabulary notes
BOTB – British Overseas Trade Branch
suitable – подходящий
notification- извещение, уведомление
counterparts – коллеги в бизнесе
mother tongue – родной язык
preliminary – предварительный
spade-work – подготовительная работа
1.
2.
3.
4.
5.
6.
7.
8.
9.
eligible – подходящий
subvention – субсидия, дотация
instantaneous – немедленный
to catch up with – догонять
subscription – абонемент
undoubtedly – несомненно
Comprehension and Discussion Questions
When you’re chosen the most suitable type of overseas sales work, how would
you arrange the support of your agent or branch office?
Are personal contracts with business agent important and how should they be
organized?
What social facts of the agent’s country should be taken into consideration?
What spade-work should be done by the organizers of the British posts abroad?
What are obvious advantages of being on an outward sales mission?
Does the availability of grants depend on the country involved in overseas trade
business?
What methods of communication are open to trade agent in our electronic age?
Should you bear in mind the time difference establishing contracts with your
overseas agents?
Is it important to use postal communications with your overseas agents?
Practical Task
Look through the text, find sentences with the left Substantive Attributes and
translate the sentences into Russian.
Text II. THE CHOICE OF COUNTRIES FOR EXPORTING
There is no shortage of choices when selecting an overseas market – listing the
overseas countries to which the UK exports goods and services produces a lengthy
gazetteer of the world. Of these countries there are 180 where UK exports exceed the
147
value of 1 million each year, a clear indication of the potential for UK exporters. But
the choice can be bewildering. Other than by sticking a pin in a map of the world,
how does the company new to exporting choose which countries it should export to?
Once you have established that your company is in a position to export, your
first step will be to take stock of your present situation. The nature of your home
market, your company’s resources, the nature of your product and how it is used, the
market size and level of development and the environment required for its operation
and any knowledge of the envisaged market. Using this knowledge you can build up a
profile of your potential overseas market. By listing the characteristics of your UK
market in terms of buying habits, incomes, lifestyles and any other factors affecting it,
you can look for similar characteristics in overseas markets and hope to build on your
home market success. Ultimately your market is not a particular country, but the
potential purchasers of your product or service wherever they live. You should
therefore have a clear idea of who these people are before deciding on which
geographical area to concentrate.
If you can find these customers in a market which operates under similar
conditions to those in the UK, you will be starting your exporting effort on a sound
basis. No two markets are quite the same, but the more familiar you are with a
potential overseas market the better you are placed to interpret the prevailing trends
for trade and the successful promotion of your product. It may seem simplistic but, on
the same basis, looking at countries you know from visits or holidays abroad can be a
good starting point. An understanding of a way of life in certain country will greatly
assist you in your task of deciding how to sell your goods there.
Market research will uncover the real potential for your product and your
chances of success in a particular market, and is therefore a vital part of the process of
starting to export.
However, it is clearly neither feasible nor sensible to research every market.
Combining your knowledge of the conditions needed for your business to thrive with
a background knowledge of conditions markets around the world will help narrow the
field considerably. Market conditions are affected by geographic, cultural and
economic factors, all of which should be taken into account before making your
selection.
You will need to consider whether a market is geographically accessible. The
nearer a market is to the UK the easier it will be to visit and to service. This is no
small consideration for a business exporting for the first time. You may not have the
resources at hand to service a market at the other side of the world, neither in
financial terms or time spent traveling. Furthermore, when problems do emerge they
may seem daunting if they are at great distance from the UK. In addition, spreading
your market too wide geographically can bring problems of servicing, which is a
good reason for concentrating your efforts on one two countries, rather than spreading
your resources too thinly. Your geographical knowledge will enable you to take
distance into account when planning export strategy. For example, it is wiser to start
exporting to one state in the USA and build up your business from there, rather than
trying to tackle the whole USA market. Remember the distance from New York to
San Francisco is the same as that from London to New York!
148
Then there are the conditions of terrain and climate which may present other
difficulties, or have implications for the sales or distribution of your particular
product. If the terrain makes distribution of goods difficult this factor must be
weighed against the advantages of that particular market for your product. Should
your goods be affected by extremes of temperature your choice of market will be
limited accordingly.
Vocabulary notes
to bewilder – озадачивать
to take stock of – критически оценить
gazetteer – географический справочник
listing – составление списка
to exceed – превышать
to envisage – предусматривать
environment requirement – требуемые
условия
ultimately – наконец
prevailing – преобладающий
trends – направления
feasible – выполнимый
to thrive – преуспевать
to affect – оказывать влияние
accessible – доступный
to emerge – появляться
to daunt – смущать, обескураживать
to spread – расширять
accordingly – соответственно
terrain – местность
implication – скрытый смысл
Comprehension and Discussion Questions
1. How does the company chose the countries it should export to?
2. What is the first step to be taken to start exporting?
3. Why should you build up a profile of your potential overseas market?
4. Is it important to know the prevailing trends for the successful promotion of
export product?
5. When will your business thrive successfully?
6. What consideration should you know to start your business exporting for the
first time?
7. What geographical factors should be taken into consideration when planning
export strategy?
Practical Task:
Make up a short summary of text II using topical sentences of the paragraphs
for the purpose.
Text III. PAYMENT FOR EXPORT SERVICES
Although payments difficulties cannot always be anticipated you should
establish, as far as is possible the likelihood of this occurring and be aware of those
countries with foreign currency restrictions. To some extent risks can be alleviated by
talking out credit insurance through ECGD or private sector companies. For smaller
businesses, the banks and other export finance companies offer ECGG-backed cover
through their schemes. As a general rule, exporting to a high-risk country should be
avoided by the new exporter. In some cases, as in Brazil, exporting certain products is
out of the question due to the restrictions imposed. The only alternative open to the
149
exporter is to set up a local manufacturing base through a joint venture with a local
domestic company.
One of the major areas to watch out for when invoicing for products services
supplied is that of invoicing in foreign currencies. Foreign exchanges have in the past
been noted as ‘the wilder beasts in the export jungle’, and for the first-time exporter
in particular this is an area which should be avoided. Try if possible to invoice in
pounds sterling. However, this can and often does lead to the displeasure from your
overseas buyer. If you do decide to risk the currency market and invoice in the
currency of the country to which you are exporting (the degree of risk is termed
“foreign exchange exposure”), then this means that while you know the rate of
exchange on the day the contracts are signed you will not know the rate applying at
the time the contracts are exchanged. In order to minimize the risk you have three
options: a foreign currency account, a forward exchange contract or a foreign
currency borrowing facility.
Foreign currency accounts mean that you will have to open a bank account in
that foreign currency through which income and expenditure can go. Basically, it
eliminates the risk by matching your currency receivable against your expenditure.
However, this is very tricky and rarely will you be able to do it. Another method of
risk-reduction should be considered to operate in tandem with this system.
A forward exchange contract is the more usual method and is available through
all the clearing banks. It operates as follows. You arrange a contract to sell the
currency you receive to the bank at a future stipulated date (a fixed contract) or more
usually between two fixed dates (option contract). The option extends only to delivery
of the currency, and there are penalties if the contract has not been used by the time it
matures. Early contract with your bank is essential if you wish to crystallize your
exchange risk by using this method.
However, before entering into any currency commitments do ensure that a
market exists for the currency, the amount specified and the time period stated.
Vocabulary notes
to be aware – сознавать, представлять
to anticipate – предусмотреть наперёд
likelihood – вероятность
to occur – происходит, случаться
to alleviate – облегчать
insurance – страховка
to avoid – избегать, уклоняться
wilder beasts – более дикие звери
to term – называть, квалифицировать
option – выбор
a
forward
exchange
contract
–
предварительный контракт по обмену
валют
currency borrowing facility – возможность
обмена валюты
expenditure – трата, расход
to match – соотносить, сравнивать
receivable – получаемый
risk-reduction – уменьшение риска
available – доступный
to specify – конкретно определять
to ensure – убедиться
commitment
–
обязательство,
договорённость
Comprehension and Discussion Questions
1. What should be done to alleviate the risk of payment difficulties?
2. What is the alternative open to the exporter?
150
3. How would you arrange invoicing for your product services in foreign
currencies?
4. Is it possible to minimize the risk in currency exchange?
5. What is the role of clearing banks to arrange a forward exchange contract?
6. What should you know before entering into currency commitments?
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UNIT XV
Text I. EXPORT AND METHODS OF PAYMENT
Getting paid promptly for the goods or services you provide to a customer in
the UK has its own problems. Before supplying your goods to a UK customer you
will have to consider their standing, how much credit should be allowed, their
reputation and track record for paying on time. Should problems arise the telephone is
to hand and. If need be, you can jump into your car and meet the customer face to
face to resolve the problem.
The logistics of dealing with someone on the other side of the Channel, or
perhaps even the other side of the world, present much greater problems. Not only
distance needs to be taken into account but also the fact that you may have to
communicate in a foreign language, handling foreign currencies, while possibly
coping with different standards and measurements. Furthermore, in some instances
the countries involved may not be as economically or politically stable as your home
market.
It is important at the outset, therefore, for you to negotiate the most secure
method of payment you can, bearing in mind, of course, the need to remain
competitive. Any exporter would prefer to be paid before sending the goods, whilst
the importer would prefer not to pay until after he has sold them. An acceptable
arrangement regarding the method of payment somewhere between the two will have
to be agreed. Therefore, it is most important to be aware of the methods of payment
you might encounter when selling abroad. In this way you can relate the risk involved
to the standing of your buyer and the country he operates in. Basically there are four
methods of payment which are listed below in order of preference:
1. Payment in Advance.
2. Payment by irrevocable Documentary Letter of Credit.
3. Payment by Documentary Collection (sometime called bills of Exchange).
4. Payment on Open Account.
There is also a fifth way which is by barter or countertrade. Where export sales
are made conditional upon an undertaking to accept manufactured goods, raw
materials or commodities from the overseas market in settlement. Although
countertrade is gaining in importance, it is unlikely that the smaller exporter would
become involved, particularly at the outset.
Selection of the most appropriate method from the basic four mentioned above
will depend on a variety of factors. These include the standing of the respective
buyer, competitive pressures, country risk and the degree of security required by both
parties. Let us now look at each method in more detail, to assist you in making the
right selection for your company.
Vocabulary notes
promptly – немедленно
to bear in mind – помнить
irrevocable
credit
–
безотзывный
аккредитив
payment by collection – плата инкассо
to be aware of – знать
to encounter – встречать
undertaking – обязательство
competitive pressures – конкурентное
давление
152
1.
2.
3.
4.
5.
6.
Comprehension and Discussion Questions
What should an exporter know when deciding to supply goods to a UK
customer?
What facts should be taken into account when supplying goods to any
country in the world?
Can you explain the position of an exporter and an importer in the
problem of payment?
Is it important for an exporter to know the standing of the respective
buyer?
What are the methods of payment?
Is counter trade important nowadays? What do you think of it?
Grammar Task:
Read through the text and find sentences with ing-forms, defining Gerund or
Participle I. Translate the sentences.
Text II. PAYMENT IN ADVANCE
This is obviously the most attractive way to be paid, but it means that, in effect,
the buyer is extending credit to the exporter. It therefore follows that is a somewhat
unusual practice, unless the exporter is selling a unique product into a market where
there is limited competition. In the case of large contracts where goods have to be
specially made, it is sometimes possible to negotiate a percentage payment in
advance. In these circumstances the buyer very often requires an “Advance Payment
Guarantee”, to be given by the exporter’s bank. The bank will require security for the
guarantee and will charge fee for the service. If the contract is not completed, then the
guarantee will be called and the bank will look to the exporter for its money.
If your advance payment takes the form of a cheque payable abroad, do
remember that your bank will have to clear the cheque before they credit your
account and this may take 21 days or more. Payment in advance is fine if you ensure
you have clean money on your account unencumbered by an Advance Payment
Guarantee.
Vocabulary notes
payment in advance – предоплата
obviously – очевидно
attractive – привлекательный
to negotiate – договариваться
to extend credit – предоставить кредит
circumstances – обстоятельства
to charge fee – требовать гонорар
to ensure – гарантировать
unencumbered – необременённый
Comprehension and Discussion Questions
1. Is payment in advance the most attractive way for a buyer or for seller?
2. Who gives a payment guarantee for the buyer?
3. When is payment in advance a positive method?
153
Text III. THE DOCUMENTARY LETTER OF CREDIT
This is usually the most secure and prompt method of payment but it can
involve the most headaches.
A Documentary Credit can be defined in simple terms as a written undertaking
given by a bank on behalf of a buyer to pay the seller an amount of money within a
specific time, provided the seller presents documents to the bank, strictly in
accordance with the terms and conditions laid down in the Letter of Credit. In other
words, the buyer effectively provides the seller with a guarantee of payment, in return
for an assurance from a bank that the required documentation has been delivered to
that bank’s satisfaction. It is important to note that banks deal only in documents and
not in goods. They cannot be concerned with the underlying sales contract, but
determine whether the terms and conditions of a credit have been met on the basis of
documents alone.
There are three types of Documentary Credit – the Revocable Credit, the
Irrevocably Credit, and the Irrevocably Confirmed Credit.
1. Revocable Credits are, as the name implies, credits which can be cancelled
or amended by an importer (or an exporter) up to the point where the
goods are shipped and documents presented to the paying bank. As such,
they should be avoided and in fact are rarely used.
2. An Irrevocably Credit means that the obligations of both parties to the
credit cannot be altered in any way, without the agreement of both the
buyer and the seller.
When contract terms are negotiated for settlement by Letter of Credit, the buyer
requests his bank (the opening bank) to open a credit in favour of the buyer (the
beneficiary). If his bank is prepared to extend a facility for this purpose, then it will
instruct a bank in the exporter’s country to advise the exporter that the credit has been
established and will incorporate details of the terms and conditions which must be
fulfilled in order to obtain payment. What this means is that the opening bank stands
between the buyer and seller, guaranteeing payment subject to the necessary
conditions being fulfilled.
This is perfectly acceptable and quite normal when dealing with a reputable
bank in a politically and economically sound country. However, you may not have
heard of the bank and the country involved may well have debt problems, or there
may be concern over its political stability. What you would really like is someone you
can trust standing between you and the overseas bank taking on responsibility for
guaranteeing the credit. In these circumstances you could ask for the credit to be
confirmed by a UK clearing bank.
3. Irrevocably Confirmed Credit. Should the UK bank be in a position to add
its confirmation to the credit (and this is not necessarily a foregone
conclusion) then the exporter has that bank’s guarantee that, provided all
conditions of the credit are fulfilled, payment will be made irrespective of
what might happen to the opening bank or indeed the originating country.
Maximum security of payment is gained by having a credit confirmed in
this way, but the ability to confirm depends on the credit line the advising
banks is prepared to extend to the opening bank. In some instances, in Iran
154
a UK bank would be precluded from adding its confirmation by the
Iranian authorities themselves.
These then are the basic types of credit available to you. As you become
involved in exporting you will hear of other variations designed to meet specific
purposes and which include Transferable Credits, Revolving Credits, Standby
Credits, and so on. Any of these may be appropriate to your particular needs, and you
should make early contract with your own bank for further details. Along with their
other publications on exporting, most banks supply comprehensive booklets on
documentary credits. These are highly recommended as a sound source of reference.
Whatever form of credit you encounter the general rules are the same. The first
point to appreciate is that the paying bank has a mandate to pay, if the documents are
in order and the terms and conditions are complied with precisely. Regrettably, over
50 per cent of credit cannot be paid on first presentation due to discrepancies. Many
of these could easily be avoided by the beneficiary adopting a disciplined approach to
his presentation procedure.
Vocabulary notes
headaches – головные боли
prompt – быстрый
provided – при условии
strictly in accordance – в строгом
соответствии
to imply – иметь в виду
to cancel - отменять
to amend - исправлять
to appreciate – оценивать
beneficiary – владелец фонда, собственник
1.
2.
3.
4.
5.
6.
reputable bank – надёжный банк
involved – заинтересованный
forgone conclusion – заранее принятое
решение
irrespective - независимо
instances - случаи
to preclude – предотвращать
discrepancies – разногласия
regrettably – к сожалению
Comprehension and Discussion Questions
How can you explain the notion “a documentary credit”?
What is the role of banks in the trading process?
What is the difference between a revocable and irrevocably credits?
What is the procedure of promoting contract terms?
Is it important to deal with a reputable bank?
What does “irrevocably confirmed credit” mean?
Text IV. CONTRACT OF SALE
Prior to a documentary credit being established, the buyer and seller enter into
a Contract of Sale which includes:
1. The price basis - reflecting terms of delivery, CIF, FOB, and so on.
2. A period of time to allow for shipment by the seller and a latest date of
shipment.
3. A description of the goods.
4. The method of payment agreed, ie by Documentary Credit payable in sterling
at sight in London.
155
5.
6.
7.
8.
The method of despatch of the goods.
The documents required by the buyer.
The name of an arbitrator (in case of need) in the event of a dispute.
The name of the seller's bank through which the credit is to be
advised/confirmed.
9. Details of who is to be responsible for paying bank charges, both at home and
abroad.
If all these points are considered at the outset and the Contract of Sale is agreed
between the parties, then a workable credit acceptable to the seller should result. It is
as well to incorporate a date by which the credit is to be received, as this will enable
you to alter prices, and so on, should the credit not be opened in a reasonable time.
When the credit is received, study the terms and conditions carefully and show
it to your forwarding agent to ensure he can arrange the necessary shipping space. If
you are unhappy with any aspect of the credit, seek clarification from the advising
bank. If you know you are unable to comply with any requirement, request an
immediate amendment from the buyer. You are now ready to ship the goods and
present your documents to the advising bank for payment.
There are a number of documents basic to most credits and there may be
additional ones relative to the goods you are exporting, or the country for which your
goods are destined. The most important documents are listed below:
1. Documents evidencing movement of the goods. Depending on the mode of
transport agreed, these may take the form of Bills of Lading, Air Waybills, Railway
Consignment notes, Parcel Post Receipts, and so on. In other words, evidence that the
goods have been released to a carrier for onward movement overseas.
2. Invoices. Commercial invoices will be required in the number of copies
specified, giving a full description of the goods, the price, the terms of shipment,
freight and insurance costs where payable, details of import licences and shipping
marks as they appear on the movement document. A certified invoice or Certificate of
Origin may be called for on which it will be necessary to certify the country of origin
of the goods. The credit may call for this certification to be given by an approved
Chamber of Commerce. Consular Invoices are required by some countries which
usually take the form of specially printed documents available from the appropriate
consulate, which have to be legalised. Delays can be encountered in obtaining
legalised invoices, so early action is recommended when these are needed. Some
consulates charge quite high fees for this service, another factor to be taken into
account when setting your selling price.
3. Insurance certificates. It is essential that all goods for export are covered by
insurance at every stage of the journey. Who is to pay for this insurance will have
been agreed in the Contract of Sale.
Where insurance is arranged by the exporter, the credit will call for evidence to
this effect, usually in the form of a Certificate of Insurance. It is also likely that the
credit will call for a value at least 10 per cent over the invoice value. The risks
covered should be exactly those stipulated, the certificate should not be dated after
shipment, and if claims are payable at a specific place, then this too must be
156
incorporated. These documents should also show the relative shipping marks for
identification purposes.
4. Other documents. Depending on the type of goods being exported, the credit
may also call for packing lists, weight notes, Certificates of Chemical Analysis,
Health Certificates and the like, all of which are self-explanatory. Some foreign
governments require all imports to be covered by a Clean Report of Findings given by
an independent inspection agency. These agencies are established worldwide and will
carry out a check on your own premises, prior to shipment, examining quality and
quantity and making a price comparison. Make an early request for a visit, as there
can be delays. This requirement is most common when exporting to African States.
Vocabulary notes
delivery CIF (cost-insurance-freight) –
доставка CIF
delivery FOB (free-on-board) – доставка
FOB
bank charges – оплата банковских услуг
to enable – позволять
to alter – изменять
forwarding agent – экспедитор
immediate amendment – срочная поправка
relative – имеющий отношение
to evidence – засвидетельствовать
Bill of Lading – коносамент
Air Waybill – авиатранспортная накладная
Consignment – отправка груза
invoice – счёт-фактура
freight – фрахт, груз
insurance – страховка
consulate – консульство
prior to – до, прежде
Text V. DOCUMENTARY COLLECTION
If it is not possible for you to obtain a Documentary Letter of Credit from the
overseas buyer, you can adopt the alternative method of sending the documents on a
collection basis. Here, the shipping documents, including the Bills of Lading and
other transport documents, are handed to your bank, which then sends them to a
suitable bank in the buyer's country. Your buyer will then be notified of the arrival of
these documents and the terms on which they will be released to him.
Depending on the terms of the sale you agreed originally, the Bill of Exchange
may be drawn on the overseas buyer 'at sight'. This means that the documents will
only be released to the buyer against payment of the bill. When documents of title are
being set out, this 'documents against payment' procedure usually ensures that control
over the goods is maintained by you until payment is made. However, there is always
the risk that you will incur demurrage (or storage) charges and additional insurance
costs should the bill not be paid promptly and the goods remain uncollected.
When your buyer's integrity is proved to be satisfactory you can then consider
offering extended credit terms. In this case a 'Term Bill' may be drawn, calling for
payment 30, 60, 90 or even 180 days after sight (or, in some cases, after date of
shipment). Documents of title (ie proof of ownership) will be released following the
buyer's acceptance of the bill. He is then able to take possession of the goods which
then pass out of your control.
It should be noted that where the goods are dispatched by airfreight or parcel
post direct to the buyer, control of the goods is lost immediately on dispatch.
157
Banks in the UK and in the majority of other countries, handle collections
under the terms of the ICC 'Uniform Rules for Collections'. You can obtain a copy of
these rules from The International Chamber of Commerce.
One popular misconception with regard to Documentary Collections is that the
overseas bank can enforce payment, or that they have earmarked funds to meet
maturing Bills of Exchange. This is not so and the local bank can only follow
instructions given by the remitting bank. One of these instructions may be to 'protest'
the bill is unpaid at maturity, in which case the overseas bank will be required to
instruct a Notary Public to make an official protest. He will call on the buyer and note
the reason for non-payment on a 'Deed of Protest' and this, together with the
dishonoured bill, form the basis for taking the matter to litigation. This is as far as the
overseas bank can go, however, if the bill still remains unpaid, they will either
arrange to return the goods to you or release them to your local agent, perhaps for sale
to a different buyer.
Vocabulary notes
Letter of Credit – аккредитив
collection basis – на основе инкассо
to extend credit terms – продлить сроки
кредита
Bill of Exchange – переводной вексель,
тратта
to dispatch by airfreight or parcel post –
отправить авиагрузом или бандеролью
The International Chamber of Commerce –
международная торговая палата
Uniform Rules for Collection – единые
правила для оплаты инкассо
proof of ownership – доказательство права
на собственность
to incur – навлекать на себя
demurrage – простой
misconception – неправильное понимание
dishonoured bill – фальшивый счёт
Text VI. OPEN ACCOUNT
If you know you are dealing with a buyer of impeccable reputation, business
can be conducted on an open account basis. In other instances competitive pressures
within the market may make this a necessity.
In this case the simplest method of obtaining payment is to send any relevant
documents to your customer for immediate payment, or for payment at a specified
time. The customer may pay with his own cheque, but remember it is your company
that will have to pay bank collection charges and take the risk of delay or even nonpayment. For example, the cheque could be returned as a result of some technical
irregularity as well as through lack of funds. These risks do need careful
consideration. The overseas legal procedures required to enforce payment under an
open account arrangement are more complicated than those to enforce payment of a
bill for collection.
In order to avoid potential problems you can ask your customer to arrange for
payment to be made either by banker's draft, or directly through their bank by means
of a mail or cable transfer to the credit of your company's account. It is worth
remembering that postal delays can occur and the expense of a cable transfer may
well be worthwhile. Early receipt of funds can make a substantial contribution to your
158
cashflow. Payment remitted in this way is by far the quickest and most effective
method. To simplify such transfers, you would be well advised to quote the name and
address of your bank together with your account number on the invoice.
Vocabulary notes
impeccable – безупречный
obtaining payment – получение оплаты
specified time – конкретно указанное время
to enforce payment – взыскать платёж
a bill for collection - счёт инкассо
postal delays – почтовые задержки
cable transfer – перевод телеграммой
worthwhile – стоящий
substantial contribution – существенный
вклад
cashflow – движение наличного капитала
159
UNIT XVI
Text I. EDUCATION AND ECONOMICS
Educational reform is in the air everywhere, from France to South Korea, from
Australia to Germany. The three powerhouses of the world economy – Europe,
America, and the Asia tigers – are competing to educate their workforces and to
attract and create high-value-adding jobs.
Half a century ago, you knew you were on the road to nowhere if you were
made minister of education. Today education ministers are usually on their way up.
Margaret Thatcher used the education portfolio as a stepping-stone to the
premiership. Bill Clinton first captured national headlines with his reforms of
Arkansas schools. George Bush tried to salvage his do-nothing reputation at home by
dubbing himself “the education president”.
Such politicians have a shrewd sense of what will go down in the bar rooms
and boardrooms. Chief executives of multinational firms hold earnest conferences on
skills shortages and training strategies. Serious newspapers and heavyweight
magazines devote pages to education and national competitiveness. Throughout the
rich world, voters put education near the top of their list of worries.
This concern for change has its origins in the 1960s, when the aim was to turn
elite educational debates have shifted. Governments now treat education not as a
consumer good but as a productive asset.
They are particularly worried about cost and quality. The West and the East
converged on the issue of quality from opposite directions. In Britain and America
conservative governments turned against child-centred teaching and called for a
return to basics. They wanted more rote learning and less creative writing. In East
Asia governments now feel that they have solved the quantity problem. They aim
instead to increase the quality of education, particularly the quality of the education of
the brightest. Hence a current Asia fashion for such things as creative writing.
Governments have also moved their emphasis from education to training. If
education reform in the 1960s took aim at the university, it is now the training college
which is in the sights of the reformers. A mixture of technological innovations and
demographic trends is persuading governments to improve the vocational
qualifications of their workforces.
There is no consensus on how to improve education. Many prominent
reformers are pushing in opposite directions. The most comprehensive reform
programme has been the one implemented by the British government since 1988. This
is mixture of centralization (imposing a national curriculum and reducing the role of
local-education authorities) and competition (giving schools an incentive to compete
for pupils and encouraging pupils to compete for result). This has attracted many
imitators and would-be imitators. Sweden is reorganizing its school system into an
internal market. Denmark has introduced per-capita funding for technical colleges.
Singapore is going for league tables to stimulate competition between schools.
American reformers would like to introduce educational vouchers and national tests.
Other reformers are doing just the opposite. In South Korea and Japan the
education ministries want to delegate power to local government. The Japanese
160
authorities strongly disapprove of league tables of schools. Still, even if governments
disagree about how exactly to proceed, they agree on the need for reform. Are they
right to invest so much time and effort in doing it? Does education pay, or have the
politicians merely been seduced by the professor?
Vocabulary notes
powerhouse – сильная группа, сильная
команда, хороший игрок
to create high-value-adding jobs –
создавать рабочие места для
высококвалифицированных рабочих
(создающих высокую добавленную
стоимость)
stepping-stone – ступенька (у входа)
to salvage [‘sælvidз] – спасать
to dub – дать прозвище, окрестить
competitiveness – конкурентоспособность
productive asset – производительный актив
rote learning – механическое заучивание
(не понимая смысла)
1.
2.
3.
4.
5.
6.
7.
8.
hence – отсюда, следовательно, с этого
времени
training – профессиональная подготовка
training college – специальное училище,
техникум
vocational
qualification
–
профессиональная квалификация
curriculum [kə’rikjuləm] – курс обучения
incentive – стимул
league tables – списки школ с
распределением их по классам согласно
результатов экзамена
educational voucher – свидетельство об
образовании
Comprehension and Discussion Questions
What do you think of the educational reform? Is it in the air?
Was the educational reform effective half a century ago?
What was the state leaders’ contribution to the educational reform?
Education is treated today as a productive asset, isn’t it?
What do you understand in solving quantity and quality problem in the
education system of today?
Why the world governments have moved their emphasis from education to
training?
What are the new approaches and innovations in the comprehensive reform
programmes of the British and other governments?
Does education pay to the improvement of a country’s productive asset?
Text II. EDUCATION AND EMPLOYMENT
Does education pay? If virtue gets its reward in heaven, education is a highly
remunerative investment.
Take employment. The longer you spend in being educated, the less likely you
are to end up on the dole. In America in 1989, 9.1% of people who went no further
than lower high school were unemployed, compared with 2.2% of people who
completed university. In Japan the equivalent figures were 7% versus 2.3%. The
troubles of people who fail at school are getting worse by the decade. Over the past
30 years, each economic downturn has pushed a larger proportion of the uneducated
into unemployment; and each upturn has rescued a smaller and smaller proportion of
them for the labour market.
161
Or consider real incomes. It is hardly surprising that the well-educated have
always been richer than the poorly educated. But the gap is getting steadily bigger. In
1980 a college-educated American ten years into his career earned 31% more than a
contemporary who had finished only high school. By 1988 the earnings gap had
yawned to 86%. Over the 1980s male college graduates saw their real incomes rise by
10%: high-school graduates saw their incomes fall by 9% and high-school drop-outs
by 12%. College graduates will fulfil the American dream of earning more than their
parents. The average high-school drop-out will not.
Or take future prospects. Educational success in youth seems to pay mounting
dividends in maturity. People who leave school early rapidly run out of rungs on the
earnings ladder; university graduates not only find plenty of rungs, they also discover
that each step upwards is increasingly remunerative. One reason for this is that the
well-educated land jobs that provide them with more training, while the uneducated
are locked out of opportunities to improve their skills.
Throughout the advanced world, employers complain that a shortage of skilled
workers is holding up economic growth. Schools and universities seem to be
incapable of producing an adequate supply of properly trained and technically
qualified workers. The shortages come in two distinct trends: quantitative and
qualitative. The general workforce is insufficiently educated to do the jobs available.
There is also a mismatch between the skills offered by people and the skills needed by
industry. The universities continue to churn out humanities-trained generalists at a
time of soaring demand for scientists and engineers.
The skills deficits show no signs of abating, even during today’s economic
downturn. All advanced countries predict a significant fall in demand for unskilled
labourers and significant increase in demand for skilled workers and high-grade
administrators and scientists.
Vocabulary notes
remunerative [ri'mju:nərətiv] – выгодный,
доходный
to be on the dole – получать пособие по
безработице
lower high school – младшие классы
средней школы
economic
downturn
(upturn)
–
экономический спад (подъём)
drop-out – исключенный (из школы)
earnings ladder – шкала роста зарплат
remunerative – хорошо оплачиваемый
maturity – зрелые годы
а rung – ступенька (вверх по лестнице)
to hold up economic growth – сдерживать
экономический рост
mismatch – несоответствие
a trend – направления, тенденция
to churn out – производить, выпускать чтолибо в большом количестве
to soar – стремительно повышать(ся)
the Humanities – гуманитарные науки
Comprehension and Discussion Questions
1. Is education a highly remunerative investment in the employment
programmes?
2. Can we consider education a highly remunerative investment in the terms of
real incomes?
3. What are the future prospects of educational success in youth?
162
4. Can a shortage of skilled workers hold up economic growth?
5. What do you understand by a mismatch between the skills offered by the
people and the skills needed by industry?
6. What is a prospective demand for skilled workers?
7. Can the skills deficit have a negative effect on the economic upturn?
Practical Task:
Read through text II, write out the left Substantive Attributes (clusters) and
translate the sentences into Russian.
Text III. EDUCATION AS AN ECONOMIC ASSET
Why has education become such an economic asset in rich countries? Why are
skills shortages mounting at a time of rapidly rising unemployment? The question can
be answered in just two words: globalization and automation. Globalization means
that many low-value-adding jobs are exported to poorer and cheaper countries.
Automation means that jobs that stay in rich countries are increasingly done by
machines rather than men. Having made its first impact in manufacturing, automation
is now affecting the service industries, with some excellent results (cash point, for
example).
There is nothing new in the triumph of brain over brawn. The richer countries
have long found that ever larger proportions of their populations are employed in jobs
that require mental power rather than muscle power. For more than a century,
relentless technical innovation and sustained economic expansion have been creating
new and cleverer jobs and thus increasing the demand for better educated workers. At
the same time, the rise in real incomes and the spreading of wealth has increased the
demand for more sophisticated products and services. Prosperous people employ
more people to look after their money and pander to their whims.
The shift towards smarter jobs seems to have accelerated in the past decade,
mainly because of a kick from information technology (IT). A decade ago some
people worried that IT might, in effect, make the workforce stupid: the machines
would do the thinking, the workers would simply watch and wonder. In fact, the
opposite has happened. Information technology has not only increased the demand for
scientists and engineers, who invent and upgrade the machines, and for managers and
supervisors, who put them to work. It has also put a premium on competence for
everybody. You need intelligent workers to get the most out of intelligent machines.
For the past 90 years, most factories have employed a system of mass
production – dubbed Taylorism, after the man who invented it, or Fordism, after the
man who perfected it. This is based on two simple principles: the division of labour
(separate complex tasks into their simplest components) and managerial omnipotence
(allow the managers to make strategic decisions and expect the workers to do as they
are told). This system has little use for popular education, since it reduces workers to
little more than cogs in a great industrial machine.
163
The problem with Fordist firms is that they are too simple to exploit
sophisticated technologies, too uniform to generate variety and too inflexible to
respond to rapidly changing demands.
Vocabulary notes
low-value-adding – рабочие места для
низко
квалифицированных
рабочих
(создающих
низкую
добавленную
стоимость)
impact – воздействие, влияние
brawn [bro:n] – плоть, мускулы
relentless – неослабевающий
1.
2.
3.
4.
5.
6.
7.
to pander to one’s whims – потакать,
угождать чьим-либо прихотям, причудам
omnipotence – всемогущество
cog – винтик (в машине)
(in)flexible – (не) гибкий
sophisticated – сложный, изощрённый
to appreciate – оценивать
Comprehension and Discussion Questions
What does globalization mean?
What does automation mean?
What were the economic reasons that demanded better educated workers?
What increased the demand for more sophisticated products and services?
How do you appreciate the usage of information technologies in the
development of economy productivity?
What were the principles of a system of mass production employed by most
factories in the past century?
Was the division of labour useful for popular education?
Practical Task:
Read through text IV, write out the left Substantive Attributes and translate the
sentences into Russian.
Text IV. VOCATIONAL TRAINING IN AMERICA AND EUROPE
America has been in a panic about education for at least a decade and is right to
be worried. Talk to businessmen and they will complain that they have a choice
between providing new recruits with remedial education or moving their back-room
offices abroad. America’s high-school drop-out rate is at least 14 % compared 9% in
Germany and 6% in Japan. The school year is 180 days – 60 days fewer than in some
other countries. Japanese children do five times as much homework per week as their
American counterparts. Even when they are working, American children are seldom
stretched. The lack of a core curriculum encourages a shopping-mall approach to
education: pile up the soft options and leave the hard stuff on the shelves. The result
is all too predictable. American children perform poorly in international academic
tests.
German education commands admiration abroad and enthusiasm at home.
German parents like it because it provides flexibility and choice. Students like it
because it is intellectually demanding without being soul-destroying. Employers like
it because it churns out skilled workers as well as scientists. The government did not
164
have to think twice before imposing western German arrangements on the new lands
in the east.
What makes the system so successful? The first thing is the cheerful division of
schools into three kinds: grammer schools, technical schools and vocational schools.
Grammer schools can challenge academic children without discouraging their less
able contemporaries. Technical schools can motivate their pupils by introducing them
to general principles through practical example. The most striking achievement of this
system – more striking even than its success in grooming the elite – is its ability to
engage the enthusiasm and test the abilities of the mass of tomorrow’s skilled
workers.
Above all, the glory of German education is the so-called dual system. Any 15
year-old who does not want to go to university chooses a three-or-more-year
apprenticeship instead. It combines on-the-job training in a local factory and
theoretical education in school (this used to mean two days a week, but increasingly
means three). Successful apprentices are guaranteed a job in a local factory. Their less
successful contemporaries are more than likely to be able to put their training to good
use.
The French have an enormous advantage over the British in implementing
reforms: the legacy of Bonapartism. Scientific and technical schools have enjoyed a
high status in France for two centuries. French schoolchildren have long been
accustomed to spending much of their adolescence working for the school-leaving
certificate, an examination that is at once broader than English A levels and more
rigorous than German.
This left the government free to concentrate on the weakest link in its
educational chain: vocational training. The academia-obsessed school establishment
despised it. Business was too short-sighted to invest in it. Apprenticeships hardly
existed outside the artisan industries. So the government decided to act. It compelled
firms to spend 1%of their sales on training, and encouraged vocational school to
expand; it created a clear set of vocational qualifications; and it set out ambitious
targets for improving the technical qualifications of the working population. Today
almost all school-leavers who do not go to university enroll in full-time vocational
courses that lead to nationally recognized qualifications.
The British have been even more radical than the French. They introduced a
national curriculum backed up by regular examinations, finance schools on the basis
of the number of children they attract (per capita funding), oblige local authorities to
classify the schools in convenient league tables, bypass local-education authorities
and hand budget to individual governing boards and set up a new type of school – the
city technology colleges (CTCs). But a handful of CTCs and a host of TECs
(Training and Enterprise Councils responsible for organizing training in their local
areas) will not be enough to hold the Asian tigers at bay.
165
Vocabulary notes
remedial
education
[ri'mi:djəl]
–
коррективное обучение
back-room offices – секретные научноисследовательские бюро или отделы
to be stretched – напрягаться
a core curriculum [kə'rikjuləm] – основной
курс обучения
a
shopping-mall
approach
–
поверхностный подход к чему-либо
to pile up the soft option – накоплять
лёгкий выбор (материала)
contemporary – сверстник
to churn out – производить в больших
количествах
1.
2.
3.
4.
5.
6.
7.
to groom the elite – готовить элиту (к
определённому роду деятельности)
to opt for… - сделать выбор или принять
решение
apprenticeship [ə'prenti∫ip] – обучение
ремеслу
advantage - преимущество
adolescence [edou'lesns] – юность
rigorous ['rigərəs] – строгий, суровый
artisan industries – кустарное ремесленное
производство
to by pass – обходить
academia-obsessed
–
академическиодержимые
to estimate – оценивать способности
Comprehension and Discussion Questions
What is the reason of a panic about education in America?
Why are American children seldom stretched and poorly estimated in
international academic tests?
Why is German education liked by students, parents and employers?
What makes German education system so successful?
What is the advantage of German dual system?
How do you appreciate the French education system?
Why are the British more radical than the French?
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UNIT XVII
STRATEGIES IN MANAGING THE STAFF
Text I. WHAT ARE THE KEYS TO SUCCESSFUL PROBLEM SOLVING?
1. Use employees’ suggestions. You may well believe you have a better one,
but keep your goal in mind. You want to encourage risk talking as well as solving
problems. The path employees choose to reach the goal may be different from the one
you would select – however, if their method solves the problem, let them try in their
way. Work together to forsee the possible result if the plan is put into action. Share
some standards for what you consider a good plan.
2. Insist that employees contribute their suggestion. If your employees respond
with shuffling feet, averted eyes and a mumbled “I don’t know”, let them know that
you really want their help. Make them believe this is the case by not answering your
own question, even if the silence gets uncomfortable.
3. Agree on the plan. Ask your employees what they will do that will be
different next time. When employees make choices, they select the option they see as
the best at the time. Your job as coach is to help them see other alternatives.
4. Follow up the results. After employees have had time to put a solution in
place, follow up to see how it’s going. You want to follow up to make sure things are
going the way you want them to go. If they are not, you need further problem solving.
When employees put forth the effort to solve a problem, they are changing their
behaviours and may be even their habits. By noticing that the problem has been
resolved through employees’ efforts, you help them keep that change in place.
Without follow-up employees reason that you probably don’t care whether the
situation changes or not. Just notice and say something to the effect of, “I see you are
working on changing – I appreciate the effort. Keep up the good work.”
Change doesn’t happen in quantum leaps. It starts small and grows as
employees get used to operating differently. Help them to make the complete change
by recognizing their efforts along the way.
Vocabulary notes
suggestion – предложение
offer – предлагать
keep sth. in mind – иметь ввиду
encourage – ободрять, поощрять
path – путь
forsee – представлять себе, предвидеть
share
standards
–
соответствовать
стандартам
insist – настаивать
contribute to – сделать вклад
respond – отвечать
shuffle feet – шаркать ногами
avert eyes – отводить глаза
mumble – бормотать
make choice – делать выбор
coach – тренер
follow up the result – следить за
результатами
further – дальнейший
put forth the effort – прилагать усилия
change sb’s behaviour, habits – изменить
чье-либо поведение, привычки
notice – замечать
resolve – решать
appreciate – ценить
keep up the good work – продолжать
хорошо работать
quantum leap – количественный скачок
get used to sth – привыкнуть к чему-либо
operate differently – действовать иначе
recognize – узнавать, признавать
167
Ex. 1. Translate the sentences into Russian:
a) What’s your attitude towards the employees’ suggestions concerning this
problem?
b) She has been keeping it in her mind all the time.
c) The manager has encourages us today.
d) His shuffling feet and averted eyes showed that something was wrong.
e) Did you make a choice yesterday?
f) He followed up the results achieved by us.
g) Why did he change his behaviour towards you?
h) The manager appreciated the employees’ efforts.
Ex. 2. Make up sentences with the words and word combinations:
a) to offer, an offer, offering sth;
b) to encourage, courageous, courage, to discourage;
c) to share standards, a share, to share a room, sharing sb’s grief;
d) to consider, consideration;
e) to get used to sth, to use sth, to be useful, use;
f) to recognize, recognition.
Ex. 3. What would you say if you took part in these dialogues? Dramatize them.
A. I think that it’s not necessary for employees to take part in problem solving
process. It’s Manager’s responsibility. Do you agree with me?
B. I think that……………………………………………………………………….
A. What’s your reaction if the employees don’t want to solve the problems and
make suggestions themselves? How can you encourage them to offer
something useful?
B. You should………………………………………………………………………
A. Why do you insist that employees contribute their suggestion? Isn’t it simple if
you do it yourself?
B. You are not right because………………………………………………………
A. Who elaborates the plans for future actions at your company?
B. I can tell you that ……………………………………………………………….
A. Do you follow up the result after taking decision?
B. Yes, I do, because……………………………………………………………….
A. Our Manager has never noticed the employees’ efforts in solving different
problems, and never appreciated them. I don’t like it, and what about you?
B. …………………………………………………………………………………..
Text II. SITUATIONAL LEADERSHIP AS THE KEY TO EFFECTIVELY
MANAGING PEOPLE
For over 25 years, major corporations and organizations throughout the world
have used the concepts of Situational Leadership to improve the effectiveness of their
managers. One of the most outstanding leadership models was developed by Dr.
168
Hersey and Dr. Blanshard at Ohio State University to provide managers with a
practical and simple approach to achieve the best results from their people.
There are many ways you can be an effective leader – there is no single “school
solution” to the management process.
Leadership is defined as any attempt to influence the behaviour of an individual
or the group. Accomplishing a task or reaching a goal through the efforts of other
people means a person is engaged in leadership. Real leadership means managing
people fairly for mutually rewarding and productive purposes and has nothing to do
with manipulation – taking unfair advantage of or influencing others for self-interest,
or making people feel uncomfortable.
Motivating and controlling people toward accomplishment of planned
objectives requires 3 important skills: understanding past behaviour – predicting
future behaviour – directing, changing and controlling behaviour.
Research studies indicate that effective leaders can be engaged in different
types of behaviour: task behaviour and relationship behaviour.
Task behaviour provides guidance and direction – the leader clearly spells out
duties and responsibilities to an individual or group about everything.
Relationship behaviour emphasizes two-way communication with followers
and exchanging information with them. This type tends to be more nonverbal than
task behaviour. Synonyms for relationship behaviour are supporting, facilitating and
encouraging.
Some good leaders manage to combine both types of behaviour in their work,
though all of them have different leadership styles.
Leadership style is defined as the leader’s patterns of behaviour – including
both words and actions as perceived by others.
There are 4 leadership style:
 High task, low relationship behaviour (The leader provides specific instructions
and supervises followers closely, sometimes it’s called “telling”);
 High task, high relationship behaviour (The leader explains decisions and provides
followers with opportunities for clarification – “selling”);
 High relationship, low task behaviour (The leader shares ideas with followers and
facilitates decision making – “participating”);
 Low relationship, high task behaviour (The leader turns over responsibility for
decisions and implementation to followers – “delegating”).
Vocabulary notes
leadership – руководство, руководители
concept
–
понятие,
идея,
общее
представление, концепция
outstanding – выдающийся
attempt – попытка
accomplish – выполнять, заканчивать,
завершать, доводить до конца
be engaged – быть занятым
fairly – справедливо
mutual – совместный, общий
reward – вознаграждать
self-interest – личная заинтересованность
predict
–
предрекать,
предвещать,
предвидеть
indicate – указывать
guidance – руководство
emphasize – подчеркивать
tend – иметь тенденцию, склоняться к
чему-либо
combine – соединять, совмещать
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perceive
–
понимать,
различать, чувствовать
осознавать,
clarification
выяснение
–
очищение,
объяснение,
Ex. 1. Translate the sentences into Russian:
a) The concepts of Situational Leadership are used by many companies and
organizations throughout the world.
b) The program provides managers with a practical approach to achieve the
best results from their people.
c) He manages people fairly for mutually rewarding and productive purposes.
d) The effective leader can be engaged in different types of behaviour.
e) Relationship behaviour emphasizes two-way communication with
followers.
f) Task behaviour provides guidance and direction.
Ex. 2. Make up sentences with the words and word combinations:
a) leadership, a leader, to lead;
b) to define, definition, definite;
c) to be engaged, to engage, engagement:
d) to reward, rewarding, a reward;
e) to predict, predictable, prediction;
f) guidance, to guide, a guide-book;
g) to combine, combination, combined.
Ex. 3. What would you say if you took part in these dialogues? Dramatize them.
A. Have you ever heard about the notion “Situational Leadership”? I know that
this theory is popular in the countries of Western Europe. What’s your opinion
about it?
B. I suppose that……………………………………………………………………
A. I consider that real leadership means managing people fairly for mutually
rewarding and productive purposes. But do we always contemplate it in the
everyday life?
B. You are right……………………………………………………………………
A. what type of behaviour is your leader engaged in?
B. I consider that……………………………………………………………………
A. I prefer to deal with leaders who have relationship behaviour rather than task
behaviour. And what about you?
B. I don’t agree with you, because…………………………………………………
Text III. BUSINESS STRUCTURE, STAFF OF THE ENTERPRISE
Each company, firm, joint venture, stock-holding company, concern, bank,
fund has its own complicated business structure and the staff which is necessary for
the work. But still there are some general principles how to organize the work at the
enterprise.
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The Managing Director or the Chief Executive or President is the head of the
company. The company is usually run by a Board of Directors – each Director is in
charge of a department. The Chairman of the Boards is in overall control and may not
be the head of any one department.
Vice-President or Vice-Chairman is at the head of the company if the President
or the Chairman is absent or ill.
Most companies have Finance, Sales, Marketing, Production, Research and
Development, Personnel, Tax, Logistics Departments. These are the most common
departments, but some companies have others as well.
Most departments have a Manager, who is in charge of its day-to-day running,
and who reports to the Director. The Director is responsible in each Department
report to the Manager.
Let’s dwell on some positions in details.
General Manager – Supervise and leads the company’s employees. Maintains
relations with customers, executes sales contracts and provides problem analysis and
resolutions. Represent the company at fairs and distributors’ conferences. In some
companies maintains a local warehouse. Provides quality audits. Self-motivated,
decision maker.
Sales Manager – Managers the sales staff of a company, supervises sales
activity including a staff of sales representatives, plans and achieves target sales
revenues and maintains a positive relationship between the company and its clients.
Must have extensive sales experience, often as many as 5 years in the position of
sales representative before moving up to the position of sales manager. Excellent
communication and management skills are required. The person must be a proven
problem solver and possess management skills necessary to develop a sales team.
Finance and Administration Manager – Must have strong accounting
experience including maintenance of Internal Controls, costing, budgeting,
forecasting and the development of Management Information System. Must possess
proven general management skills, including development of Logistics and
Administration System to support a rapidly growing business.
Marketing Manager – Manages marketing department. Plans, directs and
executes all marketing and related activities. Initiates and/or implements advertising
strategy and promotional programs. Oversees creative effort and media plans. Must
have 3 year commercial experience, strong interpersonal skills, ability to manage a
team and lead personnel, excellent communication skills, computer literacy.
Customer Service Manager – Finds proper persons, organizes and supervises
the jobs of Customer Service Clerk, Receptionist. Provides the solution for all
existing conflict situations. Provides information and orders forms for distributors,
directors. Prepares monthly reports regarding performance of distributors.
Product Development Manager – Develops branded products for the
company. Prepares a brief of the project, a timeline with priorities and option for the
successful competition of the project. Researches on potential facilities, provides
competitors’ analysis. Realizes market research on product quality and packing.
Negotiates with the producer.
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Training Manager – Organizes and supervises trainers, develops and
implements training courses for distributors, directors, staff, etc. Learns the existing
training practice in other countries with the aim to extract, develop and implement the
best ideas in Ukraine. Tests courses to satisfy all distributors’ and directors’ needs in
training.
Forecast, Supply and Transport Supervisor – Makes monthly forecasts of all
products. Works with a company software system (product Forecast). Provides
logistics, works with suppliers concerning shipments of product to Ukraine. Arranges
shipments to Service Centers in Ukraine.
Treasury, Budget Specialist – Realizes treasury and cash flow management.
Prepares, review and monitors reports on all capital expenditure projects. Provides
budget cycle and management reporting. Ensures the company’s costing system.
Deals with internal projects, company’s legal documents. Coordinates all insurance
matters. Trains and develops staff in functional expertise.
Sales Representative – Realizes coordination of commercial activities.
Conducts negotiations with customers. Markets intelligence functions targeting new
customer group identifying business opportunities and introduction of new
technologies. Is responsible on and controls the selling activities in the frame of the
regional strategy. Frequently travels to customers. Must have the following
qualifications: Engineering, degree in some sphere, 3-5 year experience in the chosen
field.
Financial Controller – Develops accounting policies and procedures. Input
and oversees confidential and complex transactions. Implements auditing techniques
that ensure accuracy of financial results. Analyzes data and provides
recommendations to senior management for improvement. Prepares consolidated
result. Provides financial analysis. Improves internal controls. Must have University
education, be well-organized, accurate, detail-oriented personality.
Vocabulary notes
joint venture – совместное предприятие
stock-holding company – акционерное
общество, компания
enterprise – предприятие
Managing Director - управляющий
Chief Executive – руководитель
to run a company – руководить компанией
Board of Directors – совет директоров,
правления
the Chairman of the Board of Directors –
председатель правления совета директоров
be in overall control – полностью
контролировать
Finance Department – финансовый отдел
Sales Department – отдел торговли и
реализации
Marketing Department – отдел маркетинга
Production
Department
–
производственный отдел
Research and Development Department –
отдел финансового прогнозирования и
развития
Personnel Department – отдел кадров
Tax Department – налоговый отдел
Logistics Department – транспортный
отдел
report to sb – докладывать, кому-либо,
отчитываться
be in charge of sth – быть ответственным
за что-либо
Business Consultant – бизнес-консультант
supervise – наблюдать, быть начальником,
руководить
supervisor – инспектор, руководитель
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maintain
relations
–
поддерживать
отношения
execute – исполнять
fair – ярмарка
forecasting – прогнозирование
target – цель
revenue – прибыль
move up to the position – получить
повышение
implement – внедрять, применять
oversee – предусматривать
computer
literacy
–
компьютерная
грамотность
regarding – что касается, относительно
extract – освобождать, вытаскивать
branded product – фирменный продукт
timeline – срок
option – выбор
facility – оборудование
competitor – конкурент
compete – конкурировать
competitive – конкурентоспособный
negotiate – вести переговори
software system – система программного
обеспечения
shipment – отгрузка, поставка
arrange – договариваться, устраивать
cash flow – оборот наличных денег
ensure – обеспечивать
coordinate insurance – координировать
страхование
Sales Representative – представитель по
реализации
identify
–
устанавливать,
идентифицировать
frame – рамка, оправа
plenipotentiary
representative
–
полномочный представитель
Chief Accountant – главный бухгалтер
Cash Accountant – бухгалтер по работе с
наличностью
Expenses and Allowances Accountant –
бухгалтер по суммам, выплачиваемым на
содержание кого-либо или по расходам
Bookkeeper – бухгалтер
Business Information Analyst – аналитик
бизнес-информации
Tax Specialist – специалист по налогам
Treasurer
–
кассир,
секретарь
акционерного общества, казначей
Estate Agent – агент по недвижимости
Traveling Agent – агент по туризму
Advertising Agent – агент по рекламе
Personal Assistant – личный помощник
Public Relations Specialist – специалист по
связям с общественностью
Network Administrator – администратор
компьютерной сети
Packaging Engineer – инженер по
упаковки
Commodity Trader – продавец товаров
потребления
Information System’s Group Leader –
руководитель группы информационных
систем
Ex. 1. Translate the sentences into Russian:
a) Our company is a big enterprise with complicated structure.
b) The Managing Director runs this firm successfully.
c) The Broad of Directors at the bank consists of 17 persons.
d) Mr. Williams, the Chairman of the Broad of Directors, is in overall controls of
our bank.
e) Have you met Mrs. Fox, the Vice-President of the joint venture?
f) There are 8 departments at our stock-holding company. The biggest is Sales
Department.
g) He has a great experience in developing food products that’s why he’s the head
of the Research and Development Department, and also one of the creators of
our branded products.
h) Who leads your company and supervises everyday activities?
i) She is the Manager of Logistics Department, don’t you know?
j) Will your company participate in the next fair and maintain relations with your
old partners?
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Ex. 2. Make up sentences with the following words and word combinations:
a) to report to sb., a report, reporter;
b) to be in charge of sth, a charge, to charge;
c) to execute, execution, executive, Chief-executive;
d) to forecast, a weather forecast, forecasting in business;
e) to regard, regarding, regardless;
f) to satisfy (needs, requirements), satisfactory mark, to get satisfaction;
g) to compete, competitive price, competitor, competition;
h) to negotiate, to conduct negotiations, negotiable;
i) to ensure, insurance.
Ex. 3. What would you say if you took part in these dialogues? Dramatize them.
A. I don’t know personally the Managing Director of your company, but I’ve
heard that he is a perfect specialist with big experience. Can you tell me what
his responsibilities include now?
B. I’m pleased to help you understand…………………………………………….
A. I can understand why you have so many departments: Finance, Sales,
Marketing, Production, Research and Development, Personnel. But who leads
their work in the company?
B. It’s very simple…………………………………………………………………
A. You are a Sales Manager at this firm. I see that every day you work since
morning till night, you travel frequently to the customers. What duties do you
have at the firm? Who is your chief?
B. I agree with you, it’s a hard work but very interesting………………………...
A. Why do you have such a big Finance Department at your company? I counted
12 people there. I know who is the Chief Accountant and what are his
responsibilities. But I see you have also the Cash Accountant, the Treasurer,
the Statutory Accountant, etc. What do you all the people do there?
B. You are quite right but don’t forget that………………………………………..
Text IV. APPLICATION FOR WORK, STUDY
The application form usually includes the following sections: general
information about the institution, benefits, responsibilities, applicants’ criteria,
closing date for applications.
The application form contains usually:
Personal details (data):
Family name/ legal name (last, first, middle)
Title (Mr., Mrs., Miss., Ms., Dr.)
Sex (male, female)
Permanent home address, phone/fax number or Present address
Place and data of birth
Marital status (single, married, divorced, widowed)
Military status
174
Academic background usually includes all academic qualifications obtained
since completing secondary education, stating the institutions attended the main
subjects of study and when the main courses started and finished. Usually the
applicants attach photocopies of all relevant academic certificates or transcripts, with
accompanying translations into English, if they are issued in another language.
Professional background listing all positions held since completing secondary
education.
Residency issues (citizenship, permanent residence status, previous country of
residence).
Proposed course of study: What qualifications you like to obtain, in what
subjects?
At which institution would you like to study or conduct research? Are you
applying for a fully funded scholarship?
Often the applicants are asked to attach letters from two referees (both of
whom should be professional or academic) in support of the application, sometimes
it’s necessary to attach the Personal Essays. The Personal Essays provides
individualized information about the applicant, his/her ambitions, interest.
At the end you can find applicant’s obligations while studying. All the
application forms should be filled in clearly or typed.
Vocabulary notes
fill in the form – заполнить форму
application form – заявление, бланк
provide specific information – обеспечить
специфическую информацию
formalize information – формализовать
информацию
data processing – обработка данных
benefits – преимущества, привилегии
criteria – критерии
closing
data
of
applications
–
окончательная дата (срок) присылки
документов
male – (пол) мужской
female – (пол) женский
permanent home address – постоянный
домашний адрес
single – неженатый/не замужем
married – женатый/замужем
divorced – разведенный
widowed – вдовый
title – титул
military status – воинское звание
academic background – образование
complete secondary education – получить
среднее образование
attach photocopy – приложить фотокопию
academic certificate - диплом
transcript(s) – копия
residency – страна проживания
citizenship – гражданство
residence status – местожительства
obtain
qualification
–
получить
квалификацию
conduct
research
–
проводить
исследование
apply for a scholarship – подавать
документы (претендовать) на получение
стипендии
referee – рекомендодатель
personal essay – автобиография, эссе
obligation – обязательство
Ex. 1. Translate the sentences into Russian:
a) Have you filled in the application form you got yesterday?
b) I read all the general information about the University, its benefits and my
responsibilities.
c) What is the closing date (deadline) for my application?
175
d)
e)
f)
g)
h)
Don’t forget to mention your permanent home address and telephone number.
What should I write in the section “Military status”?
Do you have any academic qualification?
I attached the photocopy of my academic certificate to my application form.
I’d like to continue my studies and conduct my research work at Oxford
University.
Ex. 2. Make up sentences with the following words and word combinations:
a) to fill in (the form), to fill a glass with water;
b) to provide (information), to provide with books;
c) to be responsible, responsibilities;
d) to attach (photocopy, Personal Essay, documents);
e) residency, residence, to be resident of;
f) to obtain (qualification, experience).
Ex. 3. What would you say if you took part in these dialogues? Dramatize them.
A. I have got the application form Moscow University recently. But I have some
questions about its structure. Can you explain me what I should write in the
section Academic background?
B. …………………………………………………………………………………
A. Is it enough to mention only my recent position and the company where I work
now?
B. I don’t think so, because………………………………………………………..
A. I see that you haven’t filled in the section Professional background. Have you
got any difficulties with it?
B. You are right. Can you help me with…………………………………………..
A. I started to write my Personal Essay yesterday. If you don’t mind I’d like you
to read it and give me you remarks.
B. I’ll do it with pleasure. I suppose that………………………………………….
Ex. 4. Using the application form from the previous task fill the application
form in as if you were the applicant.
British Chevening Scholarship
APLICATION FORM
Part A. Personal Details
Family name:…………………………………………………………………………………………
(as on passport)
Other names:…………………………………………………………………………………………
Title:……….. Mr…………..Mrs…….….. Miss………... Ms…………. Dr
Sex: ……………………. Male …………………..Female
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Place of birth:……………………………...……. Date of Birth:……………………………………
Nationality:……………………………………………………………………………………………
Status:………….. Single ………..…… Married……..……... Divorced………….….. Widowed
Address for correspondence in home country………………………………………………………….
…………………………………………………………………………………………………………
Telephone number……………………………………………………………………………………..
Part B. Academic background
Please list all academic qualifications obtain since completing your secondary education, stating the
institutions attended, the main subjects of study and when the main courses started and finished.
Please indicate with an asterisk* those courses which were entirely or mainly English medium – i.e.
where the language of instruction or supervision was English:
Qualification Instruction
To
(including class or level)
Subject
Form
………………………………………………………………………………………………………….
.…………………………………………………………………………………………………………
..……………………………………………………………………………………………………….
…..…………………………………………………………………………………………………….
……..…………………………………………………………………………………………………...
Please attach photocopies of all relevant academic certificates or transcripts, with accompanying
translations into English, if they are written in another language.
Part C. Professional Background
Please list all positions helped since completing your secondary education:
Position
Organization/Institution
From
To
…………………………………………………………………………………………………………
…………………………………………………………………………………………………………
…………………………………………………………………………………………………………
………………………………………………………………………………………………………….
Part D. Proposed Course of Study in the UK
What qualification would you like to obtain and in what subjects? If there are alternatives to your
first choice, please states order of preference. If you wish to conduct research rather that obtain a
formal qualification, please state so clearly.
1………………………………………………………………………………………………………
2………………………………………………………………………………………………………
3………………………………………………………………………………………………………
4………………………………………………………………………………………………………
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At which institution would you like to study or conduct research? If you have no particular
preferences and would like the British Council to identify a suitable institution for you, please do
not complete this section.
1………………………………………………………………………………………………………...
2………………………………………………………………………………………………………..
3………………………………………………………………………………………………………..
Are you applying for a fully funded British Chevening Scholarship?
……………Yes ………………No
If not, how do you propose to supplement your scholarship?
………………………………………………………………………………………………………….
Have you already been in contact with the institution of your choice?
……………Yes ………………No
Have you ever studied in the UK?
……………Yes ………………No
Have you ever visited the UK on holiday or for other purposes?
……………Yes ………………No
If so, please indicate when and what the purpose of your visit was.
…………………………………………………………………………………………………………
…………………………………………………………………………………………………………
…………………………………………………………………………………………………………
Are you applying for any other scholarships or awards to study in the UK, to be funded either by the
British Government or by other institutions or foundations?
……………Yes ………………No
If so, please give full details.
…………………………………………………………………………………………………………
Pleas attach letter from two referees (both of whom should be professional or academic) in support
of your application for a British Chevening Scholarship. Please provide details of the two referees
below. If you are unable to attach letters from your referees, please ask them to write to us as soon
as possible.
First Referee
Title and name………………………………………………………………………………………….
Position………………………………………………………………………………………………..
Address………………………………………………………………………………………………..
How long have you know this referee? ..................................................................................................
What is his/her professional relationship to you? ..................................................................................
Second Referee (the same information)
*Finally, please state in not more than 1000 words in the space provided below
a) why you wish to study in the UK
b) why you wish to obtain the qualification listed as your first choice in Part D of this form, and
c) how you think you will benefit in terms of career and personal development from obtaining this
qualification once you have returned to your home country.
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Please also give full details of any particular areas on which you would like to concentrate while in
the UK as part of your course of study or research.
…………………………………………………………………………………………………………
…………………………………………………………………………………………………………
…………………………………………………………………………………………………………
Date…………………………
Signature……………………..........
Ex. 5. * As you see the last section of Part D is a section for Personal Essay. The
institution provides you with a special plan how to write it. Write your Personal
Essay following their instructions concerning the content and the quantity of
words.
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UNIT XVIII
BUSINESS RESUME AND BUSINESS INTERVIEW
Text I. WHAT IS IT RIGHT RESUME?
A resume is an introduction, one page, one short chance at proving you are a
qualified and experienced candidate who should be hired by a company. It wraps up
all your life experiences, needs to be professional, to the point and perfect. A resume
must present a clear picture of the candidate. For this you should know what a
potential employer expects.
They look at a person’s experience with a company, how long the person has
worked for a company or to see if he is a “job jumper”. The person should be able to
present himself in a resume. Your resume must be right, standard format, typed. To
offer details about spouses and children is not necessary and not professional.
So what should be in a resume?
Begin with the basics. Your name, address and phone (fax) number should
always go at the top of your resume. There is no need to include the words “resume”
or “c/v” – they take up precious space.
State a resume objective. It should be below the name, address and phone
number and be clear and concise job objective. Using it forces you to tailor your
resume to a particular position or company, as well as provides an immediately clear
sense of direction to those people who will be reviewing your resume. The main
objective of your writing a resume – to demonstrate your abilities for a particular
position – so state it clearly at the top. Focus on the position and career path you are
going after, and state exactly what you want. It should be more than “Objective: To
work in challenging environment.”
Talk about your accomplishments in your “Experience” section. Focus on
achievements at your present and previous jobs, especially those that involve
problem-solving, management skills, critical thinking and initiative. These should be
listed chronologically, beginning with your most recent position and then moving
through previous jobs, as long as they provide applicable experience to the position
you are seeking. Always use action verbs in your job description: words like
“administered”, “analyzed”, “coordinated”, “evaluated”, “negotiated”, “reviewed”
and “supervised” offer a stronger presentation of your abilities. But keep the
description short and to the point, and also make sure everything listed is relevant.
Include a section about your education, list it before your experience only if
your educational history is stronger than your work background. This is often best for
first-time job seekers who don’t have much work experience. Make sure to list any
additional courses you have taken that might be relevant to the job you are seeking,
including specific company training programs or language courses.
Personal data should be included in a short section at the end of your resume.
Including information about your marital status, number of children, health and
physical characteristics is always unnecessary. Include such categories as language
fluency, extensive travel history or specific computer skills. Don’t include references
on your resume.
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Vocabulary notes
applicant – кандидат, претендент
application – заявление, заявка
c/v (Curriculum Vitae) – автобиография
to go after a position – претендовать на
должность
recent position – последняя должность
career objective – цель карьеры
Personnel Manager – менеджер по работе с
персоналом, кадрами
Human Resource Manager – менеджер по
кадрам
Recruitment
agency
–
бюро
по
трудоустройству
prove sth. – доказать что-либо
be qualified – быть квалифицированным
experienced – опытный
provide applicable experience – обеспечить
необходимый опыт
have experience in some field – иметь опыт
в какой-то области
be hired by sb. – быть нанятым кем-либо
recruiter – наниматель
job jumper (changes position every 6-10
month) – тот, кто меняет работу каждые 610 месяцев
present oneself in a resume – представить
сведения о себе в резюме
concise – короткий, краткий, сокращенный,
выразительный, четкий
tailor to a particular position –
рассчитывать
(претендовать)
на
конкретную должность
post, appointment, position – должность
review a resume – просмотреть резюме
present job – работа в настоящее время
previous job – предыдущая работа
job description – описание работы
demonstrate
abilities
–
продемонстрировать способности
state clearly – четко заявить
challenging – благоприятный
environment – окружение
accomplishment
–
положительные
свойства
achievement – достижение
involve – включать
solve a problem – решать проблему
problem-solving skills – способности к
разрешению проблем
critical thinking – критическое мышление
list chronologically – перечислить в
хронологическом порядке
seek a position искать место,
устраиваться на работу
first-time
job
seekers
–
впервые
устраивающийся на работу
offer – предложить
relevant – соответствующий
work background – профессиональная
квалификация
specific company training program –
подготовительная
программа
определённой компании
personal data – личные сведения
marital status – семейное положение
wrap up additional information –
содержать дополнительную информацию
language fluency – беглость речи
travel history – поездки
refer – касаться
quantify – определять количество
concrete
testimony
–
конкретное
доказательство, свидетельство
special recognition – особенное признание,
награда
sufficient – достаточный
hold a post – занимать должность
fill a position – занимать должность
dismiss sb. – освободить кого-либо от
занимаемой должности
proofread – корректировать, исправлять,
редактировать
cover letter – сопроводительное письмо
Ex. 1. Translate the sentences into Russian:
a) The candidates have arrived in time for the interview.
b) You should send your application form by fax.
c) Have you written the new resume yet?
d) What career objective have you got?
e) Do you go after the position of a bookkeeper?
f) Our Personnel Manager will see you tomorrow.
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g)
h)
i)
j)
k)
l)
How can you prove being a qualified engineer?
This job provided him applicable experience in the sphere of computers.
The secretary was hired by Human resources Manager.
This company is the biggest employer at the food market.
Are you a job-jumper?
He’ll review your resume the day after tomorrow.
Ex. 2. Make up sentences with the following words and word combinations:
a) to type (a document, a letter, a resume), a typist;
b) job (previous, present), job description, job-jumper;
c) to focus on (accomplishments, achievements, lacks;
d) to solve (a problem), solution, problem-solving skills;
e) to seek (a position, assistance), job-seeker;
f) to take (language courses, specific company training program);
g) to support sb (candidacy for a particular position);
h) to refer, good references.
Ex. 3. What would you say if you took part in these dialogues? Dramatize them.
A. Is it necessary to type my resume?
B. I consider that…………………………………………………………...
A. I think you’d better write about your spouse and children in the resume.
Do you agree with me?
B. I don’t think so because…………………………………………………...
A. Is it obligatory to mention my educational history? Why?
B. I suppose that……………………………………………………………...
A. I started with my personal data then passed to my experience. Is that
right?
B. It’s not right, you’d better…………………………………………………
A. Did you list chronologically all your previous position?
B. No, because……………………………………………………………..
A. I think you should mention………………………………………………..
Ex. 4. Look at the plan and draft-resume. Use it as an example to write your own
resume.
1. Name, address, phone/fax number
2. Particular position, company (job objective)
3. Experience (achievements, skills)
4. Education + additional courses, specific company training
programs, language courses
5. Personal data
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RESUME
112 Kingston Road
1997
3477 London,
Great Britain
Phone 22758-53
Fax 22758-52
Oc tober, 25,
Job objective: Finance and Administrator Manager
Company: Jaar International Inc.
Experience:
recent position: 1997-1995 Finance and Administrator Manager. Supervised Development of
Management Information systems. Coordinated development of Logistics. Proved to have
management skills. International Trade Company “MARC”, Great Britain.
Previous jobs: 1995-1990 Finance Manager. IBM computers Inc. Analyzed budgeting and forecasts
programs. Evaluated as having problem-solving skills. French Branch, IBM computers Inc., France.
1990-1986 Bookkeeper. Glaxo International Co. Coordinated costing, budgeting programs, branch
department. Ukrainian office, Ukraine.
Education: 1986 Degree with Honors in Finance and Economy, Oxford University, Finance and
Administration.
1985-1986 Special training program (Glaxo International Co)
1984-1986 special language courses (French: Finance and Economy in France – Ukrainian:
Ukrainian Tax Policy)
1982-1984 Computer system for Finance and Economy
Personal Data: age 32, fluent in French, Ukrainian.
Travel history: France, Ukraine.
Profound computer skills: Win Word, Excel, Finance programs.
Ex. 5. Topics for further discussion:
a) Imagine that your friend has decided to write down a resume because he is
seeking a new job. Give him/her advice how to write it clearly.
b) You are working at the Human Resources Office and you deal with
applicants’ resumes. You know well how to write a good resume. Explain how
to do it to an applicant for a position “Sales Manager” at a famous Food
Company.
Ex. 6. Using the information provided by this chapter try to write down your
resume. Make up the plan.
Text II. BUSINESS LETTER, FAX MESSAGE
The lay-out of the business letter differs in some respects from that of the
personal letter.
Not only the sender’s address is given (as in personal letter) but also the name
and address of the person or organization to which the letter is being sent. This is
written on the left-hand side of the page against the margin slightly lower than the
date (which is on the opposite side). It should be the same as the name and address on
the envelope.
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A letter written to a man should be addressed to, for example, Mr. D. Smith or
to D. Smith Esq. (Esquire). A letter to a woman should be addressed to, for example,
Mrs. C. Jones or Miss C. Jones. If you do not know the name of the person for whom
your letter is intended you may address it directly to the company, e.g.:
The Branded Boot Co. Ltd.,
5 Rubberheel Road,
Wellingborough,
Northants,
England.
Co. and Ltd. are the usual abbreviations for Company and Limited. However
it’s better to address your letter to some individual – The Managing Director, The
Personnel Manager, The Secretary, The Branch Manager, The Export Manager –
followed by the name of the company.
If the person you are writing to is known to you, you should begin with, for
example, Dear Mr. Thompson, Dear Mrs. Warren, etc. Otherwise you should begin
Dear (Sir), Dear Madam, or Gentlemen: (Am.). Note that Gentlemen is followed by a
colon.
The body of the business letter usually includes: a) Reference, b) Information,
c) Purpose, d) Conclusion.
You should begin your letter with a reference to a letter you have received, an
advertisement you have seen, or an event which has prompted the writing of your
letter.
e. g.: Thank you for your letter of May 3rd. In your letter of January 13th you
inquire about…
It was a great pleasure to receive your letter of July 1 st that ….. I recently called
your agent in this country to ask about …. but he was unable to help me.
It is sometimes necessary to add some detailed information related to the
reference, in a subsequent paragraph.
Purpose is the most important part of the letter, where you are expected to state
clearly and concisely what you want and answer carefully and clearly all the
questions that you have been asked.
Conclusion usually consists of some polite remark to round the letter off.
e. g.: I look (I am looking) forward to hearing from you soon.
I sincerely hope you will be able to help me in this matter.
I should greatly appreciate an early reply.
Please accept our sincere apologies for the trouble caused to you, and will take
all possible steps to ensure that such a mistake does not occur.
Then usually follows the complimentary close. If you begin your letter with
Dear Sir(s) or Dear Madam you may end it with the words “Yours faithfully”. If you
address a person by name the words “Yours sincerely” are preferable. There is a
modern tendency however to use “Yours sincerely” even to people you have never
met.
The signature: sing you name clearly, in full, as it should appear on the
envelope of the letter addressed to you.
184
The connectives play an outstanding role in writing a business letter. They are
used for better comprehension of the contents.
e. g.: Owing to, Unfortunately, However, We should be pleased, We should be
delighted, We do hope, It is possible that, For this reason, We regret about, Taking
into account that, Hopefully.
Summarizing all the above said it should be stressed that any business letter can
be written using the following general scheme:
1. Heading (writer’s address, date of the letter)
2. Inside address (name and address of the person or company receiving the
letter)
3. Greeting (Dear Sir:)
4. Body of the letter (reference, information, purpose, conclusion)
5. Closing or complimentary close (saying good-bye)
6. Signature
Vocabulary notes
margin – поле (страницы)
envelope – конверт
address – адресовать
intend – иметь намерение
otherwise – в противном случае
colon – двоеточие
prompt – заставлять
inquire – выяснять
be unable – быть не в состоянии
subsequent – последующий
polite – вежливый
accept apologies – принять извинение
cause trouble – вызвать неприятности
apologize – извиняться
take steps – принимать меры
occur (about the mistake) – случаться (об
ошибке)
Yours faithfully – Искренне Ваш
Yours sincerely – Искренне Ваш
owing to – благодаря
unfortunately – к сожалению
be delighted – быть в восхищении
regret – сожалеть
take into account – принимать во внимание
Ex. 1. You have found different parts of many letters; choose what phrases you
should use: a) at the beginning of a business letter, b) in the middle, c) at the end.
Complete the phrases where it is necessary.
We have pleasure in informing you…………………………………………………….
Yours sincerely
In reply to your letter dated……………………………………………………………
We look forward to a visit of the President…………………………………………….
We wish to inform you…………………………………………………………………
Further to our telephone conversation………………………………………………….
Yours faithfully
We thank you for your letter dated 23rd March, 1998.
We have to inform you…………………………………………………………………
I’m looking forward to meeting you soon
We enclose with the letter the design documents.
Best regards
We highly appreciate the work you have done for us.
It allows us to make a decision.
Please, contact us as soon as possible.
185
Regards
Your letter has been forwarded to us by DHL.
You are kindly requested to study this material and inform us about the decision at
your earliest convenience.
I look forward to hearing from you
We are ready to assist you in this endeavor.
We have attached the payment documents to the letter.
We assure you that we shall fulfil our obligations.
In confirming our talk with your representative………………………………………
In connection with your inquiry………………………………………………………
We should like to stipulate the fact that………………………………………………
Ex. 2. Join the ideas using the connectives.
e. g. We should be delighted to take a group of your students/ Our company
regulation limit maximum numbers of groups to twenty.
We should be delighted to take a group of your students, however (please, take
into account that) our company regulations limit maximum numbers of groups to
twenty.
 We should like visiting groups to report to our office on the date of the visit/
Do please contact at the above address at 8 am.
 We have received your message concerning the date of the visit/ Arrange your
visit for early 1999.
 Our company makes a small visiting charge/ This includes the price of lunch.
 Our company reserves the right to send off the premises any members of the
group who misbehave/ It should not happen.
Ex. 3. You are working at a big company as a Personal Assistant to Managing
Director. In a month two representatives of your company will arrive in
Vermont, the USA and plan to be there for a week. Using examples given below
try to write:
a) your own letter of inquiry to the best hotel in the city;
b) book seats on a plane.
186
15 Maple Street,
Montpelier,
Vermont,
USA.
6th May, 2010.
The Manager,
Park Hotel,
26,…………. Str.,
Brighton,
England.
Dear Sir:
The name of your hotel has been given to me by the Hotel Association, and I shall be very much
obliged if you let me know whether you have the following accommodation available for 3 weeks,
from 15th July: One double room, if possible with private bathroom, and one single room.
Thank you in advance for your reply.
Yours faithfully
W.D.Throp
Win Mouk Co.,
302 Barr Street
Rangoon,
Burma
7th July, 2010
Scandinavian Airline System
12, Chelsey Street,
London, W.I.,
England
Dear Sirs:
Our Technical Director, Mr. Thuong, will be arriving in London next week and will then go on to
Sweden and Finland. We shall therefore be obliged if you book a seat for him on a plane leaving
Britain for Stockholm on or about the 21st.
We thank you in advance for your kind attention to this matter.
Yours faithfully
Win Kyu
(Secretary)
Ex. 4. You work at the Organizing Committee of International Finance
Conference which will take place in Kyiv, October 25-30, 2010. Write the letters
of invitation to the participant of the conference using the model given below.
187
A LETTER OF INVITATION
United States Department of Commerce
International Finance Conference
Washington, D.C.,
20658, USA.
July 2nd, 2010.
Prof. Petrov,
Finance Manager,
Zepter Inc., Kyiv branch,
63, Volodymirska Str,
Kyiv
Ukraine
Dear Professor Petrov:
On behalf of the American Finance Soviet it is an honour for us to welcome you and to be your host
in Washington during the International Finance Conference, May 20-27.
It is a pleasure for us not only to invite you to a conference of the highest scientific standard but also
to present Washington and, if you wish, other exciting places in the USA.
The scientific planning of the conference has resulted in a most exciting program with more than 40
major and assembly symposia not including the numerous free communication sessions.
I am glad to inform you that your abstract was accepted by our Committee, N 2256 for poster
presentation.
We attach with the letter of invitation Reservation and Registration Form. The deadline for its
submission: March 15, 2010. If you have any questions or need additional information please
contact us without hesitation.
Yours sincerely
Jim Smith
Chairman
Ex. 5. You work at a big chemical plant as a Product Manager. Inform the wellknow company-producer of chemical equipment that you would like to receive
their quotation and the latest catalogue. Use the word and word combinations
provided below.
Company: Blake & Co, Conduit Street, 40, London, Great Britain.
We are the leading manufacturers for this article………………………………………
We should be much obliged if …………………………………………………………
to consider our request………………………………………………………………….
to contact………………………………………………………………………………
in this context…………………………………………………………………………
Yours sincerely
We heard that your company is a reliable partner……………………………………
188
Ex. 6. You work at a big bank as a Computer Specialist. Let the companysupplier of the computers know that their terms of payment and delivery suit
you, but you cannot place an order with them as their prices are too high. Use
the following words and word combinations.
Company: Apple Computers, Inc., 32 5th Avenue, New York, USA.
Further to our discussion……………………………………………………………….
We wish to inform you…………………………………………………………………
We highly appreciate…………………………………………………………………...
full contract value………………………………………………………………………
to make a decision………………………………………………………………………
unfortunately……………………………………………………………………………
competitive prices………………………………………………………………………
terms of delivery………………………………………………………………………..
to reduce the prices……………………………………………………………………..
Yours sincerely
Ex. 7. You work at a food company as a Sales Manager. Inform your partners
that the prices went up and you developed the new items which would be
presented at the International Autumn Fair, November 2-10, 1999. Use the
words and word combinations given below.
Company: Thomas &Co. 25 Ashley Str., Cornwall, U.K.
We have to inform you…………………………………………………………………
to revise export prices…………………………………………………………………..
to make necessary………………………………………………………………………
increased cost of the production………………………………………………………..
as a result………………………………………………………………………………..
to enclose a copy of our price-list………………………………………………………
to draw sb’s attention to the new items…………………………………………………
to exhibit at the fair……………………………………………………………………..
We thank you for your support in the past……………………………………………...
to hope to be of service to sb…………………………………………………………...
Yours faithfully
Ex. 8. You work as a Product Manager at a big Pharmaceutical Company. Send
the fax to your partner informing about the visit of 3 representatives of your
company. Mention the terms of the visit and the purpose: to conclude the
contract with the subject – a new processing line. Use the model given below.
189
To: Generics Inc.,
Glasgow, England.
Att: Mr. James Nickles
Managing Director
Fax:8-10-245-51123-67
Date: January 22, 1997
From: UkrPharm Ltd.
Kyiv, Ukraine
Mr. P.Loza
Marketing Manager
Fax: 8-044-22567-08
Subject: a visit of 2 representatives of UkrPharm,
contract to buy a new processing line
Dear Mr. Nickles:
As we agree before we plant to send two our plenipotentiary representatives: Mr. Below and Mrs.
Solovyova for a week at the beginning of March, 1999 to Glasgow.
Please send us by fax the invitation for them as soon as possible. We kindly appoint you to prepare
all the preliminary information and documents concerning the new processing line that we plan to
purchase.
If the terms of payment, delivery, technical characteristic of the line suit us Mr. below can conclude
the contract with your company on behalf of UkrPharm Ltd.
Awaiting your reply,
Sincerely Yours
Mr. Peter Loza
Marketing Manager
Text III. BUSINESS INTERVIEW
An interview is an important event in the life of every job applicant. It can be
the last test on the way to a new position. That’s why it’s very important to be well
prepared for an interview.
Come in time to the appointed place for an interview. Don’t forget to take all
the necessary documents for your better presentation (references, characteristics,
diplomas).
Don’t be nervous and tense with the interviewer, be polite and listen attentively
to all the questions you are asked. If you are confident in what you talking about it
will make a good impression on the interviewer. Try to persuade the interviewer that
you are the best candidate for the chosen position and an asset for the company. Don’t
talk about personal questions if they are not connected with the future work.
Don’t hesitate to describe fully your responsibilities and regular duties at the
previous job if you are asked. Show that you are thinking ahead in your career
190
development. Be ready to explain the reasons of your desire to change the work. Tell
about your educational history and obtained degree. Don’t forget to mention your
computer skills, language fluency if it’s required by the company.
At the end of the interview thank the interviewer for his/her attention. Don’t
demand the immediate answer about his/her decision, appoint the certain date for it.
Vocabulary notes
get an interview – иметь интервью
(собеседование)
reference – отзыв, рекомендация
present a list of references – предоставить
список отзывов
tense – напряженный
polite – вежливый
be confident – быть уверенным
persuade – убеждать
regular duties – обычные обязанности
colleague – коллега
be an asset for the company – быть
приобретением для компании
give a good representation – хорошо
представить
demand – требовать
appoint the date – назначить дату
Ex. 1. Translate the sentences into Russian:
a) My friend has got an interview for tomorrow that’s why he is so nervous.
b) Did you present a list of references to the interviewer?
c) He was confident and they didn’t hesitate to take him for this position.
d) The interviewer was impressed by my experience in this field.
e) Did you understand all the questions during the interview?
f) What date was appointed for your interview?
g) The interviewer told me that Mr. Green was an asset for any company.
Ex. 2. Make up sentences with the following words and word combinations:
a) to get an interview, to interview sb, an interviewer;
b) to refer, reference, list of references;
c) to be tense, tension;
d) to be confident, confidence;
e) regular duties, duty free, to be on duty.
Ex. 3. What would you say if you took part in these dialogues? Dramatize them.
A. Well, Mrs. Bradley, I see you’ve already had quite a lot of experience in the
food industry. Could you dwell on your regular duties at your recent job?
B. Yes, I can tell you that…………………………………………………………
A. You mentioned earlier that you like the people you had worked with. What
features do you appreciate in your colleagues?
B. I think that……………………………………………………………………….
A. It seems to me you had a pleasant place to work. I’m surprised you are going to
leave.
B. You are quite right, but…………………………………………………………
A. You mentioned that you had attended special language courses. How do you
think it will help you in the future work?
B. I suppose that…………………………………………………………………….
191
UNIT XIX
Text I. LANGUAGE AND CULTURE IN BUSINESS RELATIONS
Another area you must also consider, particularly if you are looking at the
Middle and Far East, is that of cultural differences. Whichever country you decide to
export to the most obvious obstacle will be that of language. Your own facility or that
of your staff in the languages of your chosen markets may be a crucial factor. If you
feel that you can just ‘get by’ in any particular market using English, you should
remember that at some stage you will need to produce sales literature and packaging
in the local language. Ideally you should be familiar with the language of your export
market, or it should be one where English is an acceptable, commonly used business
language. Therefore if you are unfamiliar with export procedures you will be safer
opting for a country which has codes of business practice similar to those of the UK,
since cultural differences can make business transactions confusing.
There are also a whole range of social, practical and religious differences which
need to be considered. These factors will not affect all exporters to the same degree
and many may only come to light as a result of more detailed market research. At the
early stage of selecting a market you will, for example, dismiss the idea of selling
alcohol to the Middle East. However, too many assumptions cannot be made as
proved by the UK company which succeeded in selling sand to Saudi Arabia!
Vocabulary notes
scarcer factor – недостаточный фактор
well-endowed – хорошо обеспечена
to skew – уклониться
Text II. BUSINESS ETIQUETTE IN UKRAINE
I was making a presentation to a high-level Ukrainian in a well-respected firm
who was talking during the meeting on his mobile phone most of the time. I had been
waiting for the meeting to start for 2 hours, because the manager had an “unexpected”
guest. I have been invited to the restaurant by the person who, at the end of the meal
was discussing how much I eat and why.
Ukraine, being part of the Soviet Union had been isolated from outside world
for many years. This created problems that have to be corrected now, otherwise
integration, a popular world now, will be much more difficult. Business people who
travel to Europe, Japan and U.S. already realize what makes them look different in the
business environment of “developed” countries. But a lot of people still are not aware
of the importance of conforming to the world’s business practices.
Following are some simple bits of advice for “beginners” which I now take
the liberty of giving:
Be on time. There’s nothing worse than wasting another person’s time. If you
are late, even 1 minute, call with apologies and explain the reasons. – A secretary
should offer coffee, tea or water to the visitor. Obviously. – At the meeting, turn your
mobile phone off. If you can’t, explain the reason with apologies. – Do bring enough
business cards. Otherwise you will face a problem of who at the meeting will not
192
receive one. – If you speak Russian, Ukrainian or French use “вы” as opposed to
“ты”, until it is offered by an older or superior person to use informal treatment. If
you are being invited, order the average-price dishes and drink what the inviting party
is drinking, when possible. – If you invited another person to the restaurant, pick up
the bill. – Using a translator let him/ her know of the specific terms you will be using
during the meeting. – Wear a suit. It is very important to make a good impression,
especially, if you are working with clients. The suit that suits you. The “European
Suit”, a body conscious silhouette is good for young creative staff of an advertising
agency, while “the Ivy League Suit” looks better on a respectable solid manager. – If
you wear a suit, don’t put on a leather sport jacket. A topcoat is better. – Women, as
for make-up – less is more! Some natural lipstick and mascara are enough. The same
goes for jewelry – diamond necklaces are for Hollywood parties. And for god’s sake
don’t show the achievement of nail designers on your nails. They can be long, but
naturally looking. – Men, only one favor to ask you – long socks! Color is important
(dark is a requirement) but the priority is to see fabrics, not hairy calves. – Shoes, a
watch, glasses and bags are “talking” about you. Don’t buy the most expensive stuff.
The biggest mistake is a massive “Rolex” showered on with diamonds. Elegance and
taste make a difference. A person in the “creative” position may permit oneself some
fashion statements.
A lot of western companies developed their own “Business Ethics Code” which
is a set of rules for all employees of the firm. Among those are such simple things as
dress codes and complicated issues like nondiscrimination of women or gays. Failure
to comply with those rules can be a reason for dismissal. But since there’s long way
for Ukrainian firms to reach this point, let’s just try to endure the torture of the
existing business ethics, but strive for the better.
Ex. 1. Your partner is planning to visit your country, and is not familiar with the
eating customs there. Now write your pieces of advice in the table using should,
shouldn’t, should always, or should never to give advice on the following topics:
 When to begin eating
 Refusing to eat what you are served
 Talking while eating
 Smacking your lips or licking your fingers
 Putting your elbows on the table
 Putting your hands on your lap
 Yawning at the table
 Leaving food on your plate
Ex. 2. Read and try to answer the following question.
A questionnaire
Etiquette
About clothing
Do men to wear jackets and ties in restaurants?
Are men and women allowed to wear shorts to work in office in summer?
Are there any special rules about what you have to wear in holy places?
193
About money
Is it rude to ask people how much money they earn?
Is a woman expected to pay her share of the bill in a restaurant?
About hospitability
Should you take a present when you are invited to somebody’s home?
Is it rude to smoke without asking in other people’s homes?
Is it impolite to smoke between courses?
About tipping
How much should you tip a taxi drive?
Should you tip in a restaurant and at the hairdresser’s?
Text III. GOOD MANNERS. HOW NOT TO BEHAVE BADLY ABROAD
(BY NORMAN RAMSHAW)
Traveling to all corners of the world gets easier and easier. We live in a global
village, but how well do we know and understand each other? Here is a simple test.
Imagine you have arranged a meeting at four o’clock. What time should you
expect your foreign business colleagues to arrive? If they’re German, they will be
bang on time. If they are American, they will probably be 15 minutes early. If they
are British, they will be 15 minutes late, and you should allow up to an hour for the
Italians.
When the Europe Community began to increase in size, several guidebooks
appeared giving advice on international etiquette. At first many people thought this
was a joke, especially the British, who seemed to assume that the widespread
understanding of their language meant a corresponding understanding of English
customs. Very soon they had to change their ideas, as they realized that they had a lot
to learn about how to behave with their foreign business friends.
The British are happy to have a business lunch and discuss business matters
with a drink during the meal; the Japanese prefer not to work while eating. Lunch is
time to relax and get to know one another, and they rarely drink at lunchtime.
The Germans like to talk business before dinner; the French like to eat first and
talk afterwards. They have to be well fed and watered before they discuss anything.
Taking off your jacket and rolling up your sleeves is a sign of getting down of
work in Britain and Holland, but in Germany people regard it taking it easy.
American executives sometimes signal their feelings of ease and importance in their
offices by putting their feet on the desk whilst on the telephone. In Japan, people
would be shocked. Showing the soles of your feet is the height of bad manners. It is a
social insult only exceeded by blowing your nose in public.
The Japanese have perhaps the strictest rules of social and business behaviour.
Seniority is very important, and a younger man should never be sent to complete a
business deal with an older Japanese man. The Japanese business card almost needs a
rulebook of its own. You must exchange business card immediately on meeting
because it is so essential to establish everyone’s status and position.
194
When it is handed to a person in a superior position, it must be given and
received with both hands, and you must take time to read it carefully, and not just put
it in your pocket! Also the bow is a very important part of greeting someone. You
should not expect the Japanese to shake hands. Bowing the head is a mark of respect
and the first bow of the day should be lower than when you meet thereafter.
The Americans sometimes find it difficult to accept the more formal Japanese
manners. They prefer to be casual and more informal, as illustrated by the universal
‘Have a nice day!’ American waiters have a one-word imperative ‘Enjoy!’ The
British, of course, are cool and reserved. The great topic of conversation between
strangers in Britain is the weather – unemotional and impersonal. In America, the
main topic between strangers is the search to find a geographical link. ‘Oh, really?
You live in Ohio? I had an uncle who once worked there.’
‘When in Rome, do as the Romans do’.
Here are some final tips for travellers.
- In France you not sit down in café until you’ve shaken hands with everyone
you know.
- In Afghanistan you should spend at least five minutes saying ‘Hello!’.
- In Pakistan you mustn’t wink. It is offensive.
- In the Middle East you must never use the left hand for greeting, eating,
drinking, or mocking. Also, you should take care not admire anything in your
hosts’ home. They will feel that they have to give it to you.
- In Thailand you should clap your hands together and lower your head and your
eyes when you greet someone.
- In America you should eat your hamburger with both hands and as quickly as
possible. You shouldn’t try to have a conversation until it is eaten.
Quiz
1. When an American client arrives do you …
a) shake her hand;
b) smile and say “Hallo!”;
c) kiss her on the cheek;
d) say “Good evening!” and bow.
2. Mr. Manual Fernandez Garcia does not reply when you say “Good morning, Mr.
Garcia!” to him. This is probably because …
a) he didn’t hear you;
b) you didn’t look at him when you spoke;
c) he’s rudely ignoring you;
d) you’ve called him by the wrong name.
3. A German is taking to a Brazilian. The Germany keeps taking a step backwards
each time the Brazilian steps forward. This is probably because …
a) the Brazilian wants to be too friendly;
b) they’re both trying to be friendly;
c) the German is being unfriendly;
d) they don’t like each other.
195
4. You are taking to a visitor from Britain. Which of these questions do you ask him
or her?
a) How old are you?
b) How much do you earn?
c) Are you married?
d) What part of Britain do you come from?
5. If someone looks you straight in the eye, this means that they are …
a) not honest;
b) rude;
c) trying to frighten you
d) being friendly.
6. If someone smiles while you’re explaining something, this means they …
a) not sincere;
b) happy;
c) not listening;
d) crazy.
7. If someone frowns whilst you’re explaining something, this means they …
a) are angry;
b) don’t understand;
c) are concentrating;
d) have a headache.
8. If someone sighs while you’re explaining something, this means that they are …
a) bored;
b) impatient;
c) unhappy;
d) suffering from indigestion.
196
Supplement
DOCUMENTS SAMPLES
197
SAMPLE LETTER OF CREDIT/1
(See Instructions on Page 2)
Name and Address of Bank
Date: __________________
Irrevocable letter of Credit No. ______________
Beneficiary: Commodity Credit Corporation
Account Party: Name of Exporter
Address of Exporter
Gentlemen:
We hereby open our irrevocable credit in your favor for the sum or sums not to
exceed a total of _______________dollars ($__________), to be made available by
your request for payment at sight upon the presentation of your draft accompanied by
the following statement:
(Insert applicable statement)/2
This Letter of Credit is valid until _____________________/3, provided, however,
that this Letter of Credit will be automatically extended without amendment for
_________________/4 from the present or any future expiration date thereof, unless
at least thirty (30) days prior to any such expiration date the Issuing Bank provides
written notice to the Commodity Credit Corporation at the U.S. Department of
Agriculture, 14th and Independence Avenue, S.W., Stop 1025, Washington, D.C.
20250-1025, of its election not to renew this Letter of Credit for such additional
______________________/5 period. The notice required hereunder will be deemed
to have been given when received by you.
This letter of Credit is issued subject to the Uniform Customs and Practice for
Documentary Credits, 2007 Revision, International Chamber of Commerce
Publication No. 600
(Name of Bank)
By: _______________________
198
INSTRUCTIONS FOR LETTER OF CREDIT ISSUED FOR DEIP BID
1. Send to:
Via Express Mail or
Courier
Via U.S. Mail
Treasurer, CCC
Treasurer, CCC
U.S. Department of
U.S. Department of Agriculture
Agriculture
14th & Independence Avenue, S.W.
1250 Maryland Avenue,
Stop 1025
SW
Washington, DC 20250-1025
Suite 420
Washington, DC 20024
2. If the letter of credit is to apply to any Dairy Export Incentive Program (DEIP)
Invitation:
“The Commodity Credit Corporation (CCC) has a right to the amount drawn in
accordance with the terms and conditions of one or more Dairy Export Incentive
Program (DEIP) Agreements entered into by the exporter pursuant to 7 C.F.R. Part
1494, and the applicable DEIP Invitation(s) issued by CCC.”
If the letter of credit is to apply to a single DEIP Invitation:
“The Commodity Credit Corporation (CCC) has a right to the amount drawn in
accordance with the terms and conditions of one or more Dairy Export incentive
Program (DEIP) Agreements entered into by the exporter pursuant to 7 C.F.R. Part
1494, and DEIP Invitation No. ________________.
If the letter of credit is to apply to more than one specific DEIP Invitation:
“The Commodity Credit Corporation (CCC) has a right to the amount drawn in
accordance with the terms and conditions of one or more Dairy Export incentive
Program (DEIP) Agreements entered into by the exporter pursuant to 7 C.F.R. Part
1494, and DEIP Invitation Nos. ________________, ___________________, and
_________________.”
3.
Insert the last date of the month in which the 90th day after the date of the letter
of credit falls (e.g., if the date of the letter of credit is March 15, 2003, the date to be
inserted would be Jun 30, 2003).
4.
Insert a time period of either “one (1) year” or a specific number of whole
month(s) which total less than one year (e.g., “one (1) month,” “two (2) months,”
etc.).
5.
Insert the same time period as inserted in the previous space (e.g., “one (1)
year,” “one (1) month,” etc.).
199
CERTIFICATE OF ORIGIN
Shipper/exporter (name and address including zip code):
Booking/shipment number:
B/L or AWB number:
FYF101
MXVZ 9707503
Baking Technologies, Inc.
45 South 7th Street
Minneapolis, MN 55402
Export references:
Baking Technologies, Inc. quote number BT10102
Mendez Panaderias S.A. purchase number M3652
Consignee (name and address):
Forwarding agent (name and address - references):
Mendez Panaderias S.A.
Col. Roma
Mexico D.F., C.P. 06760
Yellow Freight
12400 Dupont Avenue South
Burnsville, MN 55337
Intermediate consignee/notify party (name and address):
Point (state and country) of origin:
MN, U.S.
Galfiro Montemayor
Avenida de Colombia
1025 Veracruz, Mexico
Domestic routing / export instructions:
Pre-carriage by:
Place of receipt:
Yellow Freight
Minneapolis, MN
Exporting carrier:
Port of loading/export:
American President Houston, Texas
Line
Foreign port of unloading (vessel and air only):
Veracruz, Mexico
Yellow Freight
Minneapolis, MN to Houston, TX
Transportation method:
Ocean Vessel
Place of delivery by on-carrier:
Mexico, D.F., C.P. 06760
Containerized (vessel
only):
YES
Container
No. / Seal
No. /
Marks
and
Numbers:
Model
BT0020
43
Number
of
Packages:
4 Crates
Description of commodities,
Model/Serial number, harmonized number
Baking/Kneading Equipment
Tariff Classification 8438.10
Gross weight (kg):
2,722
NO
Measurement
1680 Cubic Feet
Address
ed and
Number
ed
1 of 4…
The undersigned _____________ (Owner or Agent), does hereby declare for the above
named shipper, the goods as described on the above date and consigned as indicated and are
products of the United States of America. Dated at _________ on the ____ day of _______,
_______.
Sworn to before me this _____ day of _______, _______.
___________________________
Signature of Owner or Agent
The _______________________, a recognized Chamber of Commerce under the laws of the
State of ______________, has examined the manufacturer’s invoice or shipper’s affidavit
concerning the origin of the merchandise, and, according to the best of its knowledge, finds that the
products named originated in the United States of America.
Secretary __________________________
200
COMMERCIAL INVOICE
Exporter reference no.
Importer purchase/order/reference no.
Invoice expiration
date
Exporter/Shipper (Name and physical address)
Importer/Consignee (Name and physical address)
Tel:
Fax:
Email:
Intermediate consignee (Name and physical address)
Tel:
Fax:
Email:
Buyer (if other than consignee – name and physical
address)
Tel:
Fax:
Email:
Tel:
Fax:
Email:
Terms and conditions of delivery and payment
(including Incoterms):
Notify party (Name, physical address)
Tel:
Fax:



Email:
Freight (please mark): Prepaid ___ Collect___
Title transfer occurs at:
Payment terms:
Total gross weight (kg)
Dimensions HxWxL
(m3)
Marks and numbers
Total number of packages
Port of loading
Port of discharge
Total net weight (kg)
Currency of sale
Final destination
BOL/AWB No.
Transportation method:
Date of shipment:
Vessel/flight no.
L/C No.
Complete and accurate description of the goods, including item no., product
description, HS/tariff classification code and country of origin








Quantity
(Unit of
measure)
Packing costs
Freight costs
Other transportation-related costs
Handling
Insurance costs
Assists
Additional fees
Duties and taxes
Signature, initials, name, title and position
Unit price
Total
price
Grand Total
Date
Place
After the pro-forma invoice is accepted by the importer, the exporter must prepare a commercial invoice. The
commercial invoice is required by both the exporter (to obtain the necessary export documents to enable the
consignment to be exported, to prove ownership and to enable payment) and importer (who requires the commercial
invoice to facilitate the import of the goods into the country in question). In exporting, the commercial invoice is
considered a very important document as it serves as the starting or initiating document that underpins the rest of the
export transaction. The commercial invoice is essentially a bill (i.e. invoice) from the seller (the exporter) to the buyer
(the importer) describing the parties to the agreement, the goods to be sold, and the terms involved, as agreed between
the exporter and importer. As such, the commercial invoice is the final bill exchanged between the seller and the buyer.
Based on the terms specified in this commercial invoice, the importer will instruct his/her bank (referred to as the
issuing bank) to issue a letter of credit (L/C). This L/C (or the documentation associated with any other form of
payment) will also need to reflect the terms specified in the commercial invoice exactly, while all subsequent
documentation must reflect the terms of the L/C; there can be no exceptions. From this explanation, it is clear that the
commercial invoice plays a central role in an export transaction.
201
PACKING LIST
Exporter/Shipper (Name & physical address)
Shipping marks
Tel:
Fax:
Email:
Importer/Consignee (Name & physical address)
Buyer (if other than consignee – name & address)
Tel:
Fax:
Email:
Invoice No. & Date Buyer’s order No. & Date
BOL/Air waybill No.
Other reference(s)
Port of loading
Vessel/flight No.
Final destination
Port of discharge
Country of origin of goods
Marks &
Numbers/
Container
Numbers
Signature

Number &
kinds of
packages
Country of final destination
Gross
weight
(kg)
Net
weight
(kg)
Date
Dimensions
HxWxL
(cm)
Quantity
Description
(contents)
Remarks
When you prepare your goods for shipment, you may be required to prepare a
detailed export packing list.
The packing list should be attached to the outside of a package in a waterproof
envelope or plastic sheath marked "Packing list enclosed". The list is used by the
shipper or forwarding agent to determine (1) the total shipment weight and volume
and (2) whether the correct cargo is being shipped. In addition, customs officials
(both local and foreign) may use the list to check the cargo. Packing lists come in
fairly standard forms and can be obtained from your freight forwarder.
202
PROFORMA INVOICE
Exporter reference no.
Importer purchase/order/reference no.
Invoice expiration
date
Exporter/Shipper (Name and physical address)
Importer/Consignee (Name and physical
address)
Tel:
Tel:
Fax:
Email:
Fax:
Email:
Intermediate consignee (Name and physical address)
Buyer (if other than consignee – name and
physical address)
Tel:
Tel:
Fax:
Email:
Notify party (Name, physical address)
Tel:
Fax:
Fax:
Email:
Terms and conditions of delivery and payment
(including Incoterms):

Email:
Freight (please mark): Prepaid ___
Collect___
 Title transfer occurs at:
 Payment terms:
Total gross
Dimensions - H x W x L (m3)
weight (kg)
Marks and numbers
Total number of packages
Port of loading
Port of discharge
Total net weight
(kg)
Currency of sale
Country of final destination
BOL/AWB No.
Transportation
method:
Date of shipment:
Vessel/flight no.
Quantity
(Unit of measure)
L/C No.
Unit price
Complete and accurate description of the goods, including item no.,
product description, HS/tariff classification code and country of origin








Packing costs
Freight costs
Other transportation-related costs
Handling
Insurance costs
Assists
Additional fees
Duties and taxes
Signature, initials, name, title and position
Total price
Grand Total
Date
Place
A proforma invoice (sometimes written as pro forma invoice) is little more than a 'preadvice'
or indication of what will stand in the commercial invoice once negotiations have been completed.
The proforma invoice serves as a negotiating instrument. The initial proforma invoice often sets the
stage for the first round of negotiations if the exporter and importer have not yet had any real
discussions.
The proforma invoice essentially serves as a 'quotation' that sets the road to further
negotiations. Some exporters choose to prepare an 'official' quotation, while others prefer to use the
proforma invoice as their quotation.
It is important to note that there is no standard format for the proforma invoice and one
proforma invoice may differ redically in layout from the next (although there is common agreement
on the information that should be included in the document). It is a document prepared by the
exporter and so will take the format/layout decided on by the exporter.
203
BILL OF LANDING/ КОНОСАМЕНТ
_________________________________
Shipper/ Грузоотправитель
NOSTRAK CMBH & Co. KG
2 Hamburg II. Vorsetzen 39
Tel. )040)351573. Telex 212687 nost
_________________________________
Consignee/ Грузополучатель
_________________________________
Notify address/ Укажите адрес
Vessel
/Судно/
Port of loading
/Порт погрузки/
Port of discharge
/Порт разгрузки/
Vessel
/Флаг/
Marks and
numbers
Port of loading
/Судовладелец/
Freight payable at
/Фрахт подлежит уплате в/
Final destination
/Конечный пункт назначения/
Freight payable at
/Количество оригинальных коносаментов/
Kind of packages
numbers of
and description of pieces
goods
/обозначения /Тип грузовых мест /Количество
и номера/
и описание товара/ мест/
Gross
weight
Measurement
/Вес
брутто/
/Размеры/
204
CONTRACT
For purchase and sale
Kyiv, Ukraine “____”___________2010
1. Preamble
1.1. State Enterprise “Publishing House “Marka Ukraine”, hereinafter referred to as
the “Buyer” represented by Director …… acting in accordance with the Statute of the
Enterprise as one Party, and the Company LINDNER Falzlos-Gesellschaft mbH,
Germany hereinafter referred to as the “Seller”, represented by
_____________________________________________________________________
acting in accordance with ____________________________________, as other Party
, signed this Contract concerning the following:
2. SUBJECT OF THE CONTRACT
2.1. The Seller will sell and the Buyer will buy philatelic material “Goods” according
to the Appendix #1.
3. REQUIREMENT TO THE GOODS
3.1. The quality of the Goods has to respond to the standards existing for this kind of
goods in the country of the Seller.
4. BASIC DELIVERY TERMS AND CONDITIONS
4.1. Delivery terms:
4.1.1. The seller will deliver the Goods in accordance with the terms set forth
herein.
4.1.2. The delivery date will be the date of the customs stamp on the customs
declaration.
4.2. Conditions of delivery:
4.2.1. The Goods will be delivered by the Seller on the CIP terms (cost,
insurance prepaid to Kiev), as per INCOTERMS rules, 1990 editions.
4.2.2. Title in and the risk of destruction or damage of the Goods will pass from
the Seller to the Buyer at the moment of receipt of the Goods from the place defined
in article 4.2.1. of the present Contract.
4.2.3. The buyer will within 3 days upon signing this Contract communicate to
the Seller all necessary instructions concerning the dispatch of the Goods.
4.2.4. The Seller will notify the Buyer by fax of the delivery of the Goods to
carrier specifying the quantity, description of the goods, shipping date, bill number,
carrier’s details.
5. PRICE AND TOTAL SUM OF THE CONTRACT
5.1. The Parties decided that US dollars will be the currency for settlements
hereunder.
5.2. The total sum of the present Contract amounts to 3790,10 (three thousand seven
hundred and ninety dollars and ten cents) dollars USA.
205
5.3. Unit price of the Goods will be specified in invoices of the Seller as made in
writing and constituting an integral part of this Contract.
5.4. Postage expenses for Goods delivery will be paid by the Buyer according to the
invoice drawn by the Seller.
5.5. Any taxes, customs fees and other expenses related to this Contract as required to
be paid in the country of the Seller will be paid by the Seller, while any expenses to
be incurred in the country of the Buyer, including any taxes, duties, dues, will be paid
by the Buyer.
6. TERMS OF PAYMENT
6.1. The Seller delivers the Goods to the Buyer on a condition of 50% prepayment.
6.2. The other 50% are to be paid in the period of 60 days upon the receiving of the
Goods.
7. ACCEPTANCE TERMS AND CONDITIONS
7.1. The Seller is obliged to send the goods, ordered by the Buyer, during 3 days after
reception of prepayment on the settlement account of the Seller showed in the point
6.1. of this contract.
7.2. The Seller will be responsible for short delivery of the Goods in the dispatches
received free of damage subject to duly executed reports until the moment of risk
transfer.
7.3. The Goods delivered by the Seller to the territory of the Buyer will not be subject
to return in case of the failure to sell it either fully or partially.
7.4. The Goods will be accepted by the Buyer subject to comparing the data specified
in the bill of loading with the Goods arrived.
7.5. If the Buyer has not submitted a timely reclamation, he will be considered as
having accepted the Goods with no claim.
8. CONTAINER. PAKING AND MARKIND
8.1. The Goods will be placed in a container and packed so that to exclude its damage
or destruction for the period of delivery to the place defined in article 4.2.1. of the
present Contract.
8.2. Dispatch will contain two copies of the bill specifying the description of the
Goods, their quantity, etc. One copy of the bill signed and stamped by the Buyer
signifying the acceptance of Goods must to be returned to the Seller.
9. FORCE-MAJEURE
9.1. Should any circumstances arise which prevent the complete or partial fulfillment
by any of the Parties hereto of its respective obligations hereunder, namely: fire,
natural calamity, military actions of any kind, embargo, prohibition of export or
import or any other circumstances beyond the parties’ control, the term of fulfillment
of these obligations will be extended for the period during which such circumstances
will remain in force. This circumstances should be approve by the Trade Chamber or
other competent organ of the either Party, Buyer, Seller or third neutral country.
206
9.2. The Party for which it becomes impossible to meet its obligations hereunder will
notify the other Party about the beginning and cessation of the circumstances which
prevent the fulfillment of its respective obligations within 5 (five) days.
9.3. If the above circumstances continue to be in force for more than 3 months, each
Party will have the right to waive any further fulfillment of the obligations hereunder
and in this case neither of the Parties will have the right to compensate the other party
for any possible losses except reimbursement of any advances paid.
10.SANCTIONS AND RECLAMATIONS
10.1. In case of delivery of the ordered Goods, the payment for which has been made
by the settlement account of the Seller, the Seller pays the penalty in the sum 0,5%
from cost of the ordered per every days of delay.
11.ARBITRATION
11.1. All disputes and difference which may arise out of or in connection with the
present Contract will be settled as far as possible by means of negotiations between
the parties.
11.2. If the parties do not come to an agreement any dispute arisen out of or in
connection with this Contract will be referred to and finally settled in the International
Commercial Arbitration Court in Basel, Switzerland.
11.3. The Parties agree that in the process of consideration and settlement of disputes
the Rules of Procedure of the International Commercial Arbitration Court in Basel,
will apply.
11.4. The law to regulated this Contract will be International material law.
11.5. Arbitration court will consist of one arbiter.
11.6. Place of arbitration will be Basel.
11.7. The English language will be the language of arbitration procedure.
12.OTHER PROVISION
12.1. This Contract will become effective upon its signing by both Parties.
12.2. This Contract may be canceled only at the Parties’ mutual agreement.
12.3. Neither of the Parties hereto may transfer its rights and obligations arisen out of
this Contract to a third party without written consent of the other Party hereto.
13.FINAL PROVISION
13.1. Correspondence connected with the execution of the present Contract will be
carried out in the English language.
13.2. After the Contract has been signed all the preceding negotiations and
correspondence pertaining to it become null and void.
13.3. All amendment and addenda hereto will be valid only if made in writing and
signed by authorize signatories of both Parties; effective will be also their fax copies
which constitute an integral part of this Contract. Further these faximile copies have
to be approved by original documents.
13.4. This Contract is made in two copies in both English and Ukraine language, and
both text having equal legal force.
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13.5. The present Contract consist of 7 (seven) pages.
13.6. Faximile copies of this Contract have the equal power with original.
14.LEGAL ADDRESSES AND BANK REQUISITES OF THE
PARTIES
The Buyer:
The State Enterprise “Publishing House “Marka Ukrainy”
252001, Kyiv-1 Khreschatyk 22
Account № 016/26001362
Joint Stock Postal Pensionary Bank Aval for Kyiv-5 Branch, Ukraine,
St. Borychiv Tik 35, Kyiv, Ukraine
SWIFT: AVAl UA K15
USD Intermediary: The Bank of New York, New York, SWIFT: IRVTUS3N
Account no.890-0260-688
The BUYER:
State Enterprise “Publishing House “Marka Ukrainy”
Director
_________________________________
……………………….
The SELLER:
LINDNER Falzlos-Gesellschaft mgH
Director
_________________________________
……………………….
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POWER OF ATTORNEY
I/ we, the undersigned, _______________ do hereby appoint _____________
as my/our lawful attorneys with full power of substitution and revocation to
_________ in my/ our favour and further empower said attorneys to take all steps, as
said attorney any find it necessary under _____ as far as ____ is concerned.
Date this _________ day of ____ 20___
ДОВЕРЕННОСТЬ
Я
/мы,
нижеподписавшийся/еся,
_______________
настоящим
назначаю/ем ________________ в качестве моих/наших законных поверенных с
правом передоверия и ревокации с целью ____________ в мою/нашу пользу, а
также дополнительно уполномочиваю/ем вышеназванных поверенных
принимать все меры, каковые они сочтут необходимыми, в соответствии с
__________, что касается _________.
Дата ________________
ASSIGNMENT DEED
I (we) the undersigned, __________________________________________
(hereinafter designated as the Assignor) being the owner of the following
trademark(s) registered in Ukraine _________________________ hereby assign the
aforesaid Trademark(s) to __________________________________ (hereinafter
designated as the Assignee) and declare that the Assignee is henceforth to be
considered as having the exclusive rights in and to the said Trademark(s).
Signature of the Assignor
__________________________
Signature of the Assignee
__________________________
Is to be certified by notary ______________________________________________
ПЕРЕДАТОЧНЫЙ АКТ
Я (мы), нижеподписавшиеся ______________________________________
(передающий права) владелец следующего/их товарного/их знака/ов,
зарегистрированных в Украине, ________________________________________
настоящим передаю вышеуказанные знак/и _______________________________
(правоприемник) и заявляю, что с настоящего времени правоприемник
Исключительное право на данный знак/и.
Подпись передающего права
___________________________
Подпись принимающего права ___________________________
Должен быть заверен нотариусом _______________________________________
209
ABBREVIATIONS
AD – Anno Domini
BLS – Bureau of Labor Statistics
BC – Before Christ
B.Sc. – Bachelor of Science
CPI – Consumer Price Index
CD’s – Compact Disks
CEO – Chief Executive Officer
CIS – Commonwealth of Independent State
CIDP – Crime Integration and Development Programme
EC – the European Community
ECSC – European Coal and Steel Community
EURATOM – European Atomic Energy Commission
EU – European Union
EEC – European Economic Community
FDI – Foreign Direct Investment
FCIA – Foreign Credit Insurance Association
GATT – General Agreement on Tariffs and Trade
GATS - General Agreement on Trade in Service
GDP – Gross Domestic Product
ITO – International Trade Organization
IMF – International Monetary Fund
IASC – International Accounting Standards Committee
IDA – International Development Association
IFC – International Finance Corporation
IBRD – International Bank for Reconstruction and Development
MSc – Master of Science
NAFTA – North American Free Trade Agreement
P&G – Proctor and Gamble
PhD – Doctor of Philosophy
ATBT – Agreement on Technical Barriers to Trade
TACIS – Technical Assistance to the Commonwealth of Independent States
UNDP – United Nations Development Programme
UAH – Ukrainian Hryvnia
VAT – Value Added Tax
WTO – World Trade Organization
210
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