We explain the difference between import and export, the function of each one and its intervention in international trade.
What is the difference between import and export?
Import and export are two common concepts in the world of international trade, and they can be understood as the operation of acquisition and transport of goods from one country to another: these goods are imported when they are bought abroad and distributed within the country, and they are exported when they are manufactured in the country and sold to foreign consumers.
Both operations make up international trade, which is the tool that countries have to obtain the goods and services offered by other nations, and thus compensate for what is not available in their own territory. Furthermore, imports and exports constitute what is known as a nation’s trade balance: the balance (if any) between what is bought and what is sold abroad.
Importation is key so that countries can have access to materials and services that are scarce in their own territory, and that instead the selling country has surplus. However, this has a notable impact on local trade, since imported products can compete in price and quality with national products.
Instead, export is a way of dealing with the excess production of the local supply, thus obtaining extra money to be used for savings, or for local improvement.
The public or private initiatives that are dedicated to these operations are logically known as importers or exporters, and their purchases or sales are governed both by the local legislation of their countries, as well as by the agreements and commercial statutes of international rigor.
Normally, countries tend to impose taxes on imported merchandise to collect from the treasury and to increase its consumption value, thus protecting local producers of the same item.
But when free trade agreements and other similar provisions are signed, a freer and easier flow of goods is allowed, without customs impediments or so many taxes, which directly affects import and export rates.
Finally, goods and services brought into a country from abroad are called imported goods or imports, while goods and services offered abroad are called exported goods or exports.