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Overseas trade experts have some tips for you by Peter Hull It’s no secret that the global economy is in the doldrums, but for nimble companies prepared to set their sights beyond U.S. borders, there is bounty to be had. Overseas trade experts who spoke at the 36th annual South Carolina International Trade Conference May 26-28 in Charleston, S.C., cautioned that navigating the waters of international trade can be tricky. What is common business practice stateside could sink like a stone in Taiwan or Peru. And if you think you entire product line is about to take Australia by storm, slow down. Start a little closer to home. Be agile James Morrison, president and chief executive of the Small Business Exporters Association of the United States in Washington, said that the slump in global trade isn’t all doom and gloom. Sure, 2009 U.S. first quarter exports were down 30 percent compared with the same period last year. And yes, exports from the world’s major exporting countries were down 11 percent in the first quarter, with a projected overall decrease of 9 percent in 2009 the steepest slump in world trade since World War II. “So it’s a challenging environment,” Morrison said. But don’t assume all sectors and countries go down at the same rate, he said. The trick is to match the sector with the country. Financing and credit markets are coming back, and an agile company can take advantage of the current climate. Emerging markets such as China, India and Vietnam usually don’t fall as far and as hard as larger economies, so they don’t take as long to recover. Better yet, they usually come back to a stronger position than where they were before. “There are markets that are still growing and are still buying,” Morrison said. “You just have to find those markets.” Sweat the small stuff For those thinking or about to test the overseas waters, the devil, as usual, will be in the details. David Dubberly, a partner in the Nexsen Pruet law firm in Columbia, S.C., said rule No. 1 is, limit your liability. Or to put it another way, even if you don’t make money you don’t want to lose money. Too many companies try to run before they can walk, he said. Start small. Start with English-speaking countries. Start close to home. Keep the term of the contract as short as possible and make it as easy as possible to get out of the contract if things start going in a way you didn’t expect. And always get a contract in writing; a surprising number of countries go by verbal agreements. One of the biggest issues he sees is companies that want to cover too large an area. Start with a small territory, he said. “I’ve known people who started out giving an enormous territory, like Brazil, which is such a huge country,” Dubberly said. Many countries have laws that make it very difficult to shrink someone’s territory. Give them a state in Brazil then expand the territory if things work out. “It’s easier to add on than to take off,” he said. Trade freely Keep an eye on Korea, said Jonathan Fee, a partner at Alston & Bird LLP in Washington. The U.S.-Korean Free Trade Agreement, or FTA, is the largest of the pending FTAs. It’s significant, because it will be one of the few trade agreements, with the exception of Canada and Australia, with a country that has an industrialized advanced economy, including vibrant auto, steel and electronics industries. An agreement has been reached and signed by the two countries, but it’s stuck in the U.S. Congress with so many hang-ups it’s unlikely to see the light of day any time soon, Fee said. In the meantime, there’s always CAFTA the Central American Free Trade Agreement. Unfortunately, after all the work to get CAFTA in place, the perfect storm of worldwide financial disaster struck, Fee said. Whether CAFTA was too little, too late remains to be seen.	In This Issue Up Front News, Trends & Analysis New Items The Growth Paradox Supply Chain Industries to watch Trade compliance in the workplace Logistics costs dropped in 2008 Overseas trade experts have some tips for you Five things you should know about U.S. trade policy Supply Chain product review Inventory container management Features Gateway at a glance U.S. Northeast Bulk Up Ports & infrastructure Port of Seattle nets new container business Clean trucks at your ports: How to pay for them? Port Product Review Project cargo equipment Commentary Are we thinking inside or outside the box? On the horizon: Wave Energy - A future power source for your port Casualties
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Overseas trade experts have some tips for you