(a) Describe five ways by which commercial banks aid international trade
(b) State and explain five functions of the Nigerian Export Promotion Council
Explanation
(a) Commercial banks aid international trade in the following ways:
(i) Commercial banks discount documentary bills, thus ensuring that an exporter receives his money immediately.
(ii) A commercial bank can act as a referee to its customers, vouch for their financial status and integrity when foreign businessmen ask for it.
(iii) They provide commercial credits to export merchants which facilitate payment for goods imported.
(iv) Commercial banks process foreign exchange requests and help in the transfer of funds.
(v) They facilitate overseas business trips through the sales of traveller’s cheques.
(vi) They arrange delivery of shipping documents to the importer and help in clearing the goods from the ports authority and customs.
(b) Functions of the Nigerian Export Promotion Council are:
(i) Export marketing activities: The council issues information on the performance of Nigerian export commodities in foreign markets and identifies the barrier and ways of penetrating new markets.
(ii) Export financing and incentives: The council provides export financing facilities and insurance and assists exporters on export costing and pricing problems. It also advises on trade arbitration, shipping and freight.
(iii) Export development activities: The council adopts measures necessary to increase the volume of production from agriculture and ensures the development of raw products from agriculture for export.
(iv) Trade information services: The council provides trade information through the publication of trade journals and export directives. It also organises meetings for exporters.
(v) Training activities: The council organizes seminars and workshops on export management for people engaging in foreign trade.
(vi) Publicity of Nigeria Export Promotion Council: It prepares and issues publications on the various activities of NEPC.