when counter trade can be beneficial for a country?
Answers
Countertrade is a form of reciprocal trade in between countries wherein the goods and services are exchanged for other goods and services instead of currency.
This kind of international trade is very useful for lesser-developed countries which have limited foreign exchange facilities.
It is also beneficial when a country does not have any cash to give and the value of the asset can be compensated with other own assets. Also, it provides trade mechanisms for countries which do not have cash funds and can exchange resources with other nations instead.
Countertrade also provides an exporting nation which offers goods and services into a larger international market, which is useful to promote growth within the industry.
Countertrade is a kind of counter-purchase agreement in which orders can be won while in times of intense competition.
A country can benefit from counter trade when the currency is non exchangeable. or when the the other country has something that you have a shortage of, or simply when other country does not have any money to offer.