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Essay / Research Paper Abstract
This 4 page paper examines the different types of risk that may face a US firm considering financing foreign trade with Bangladesh. Issues such as the legal system, regulatory framework and problems such as corruption all discussed. Potential strategies which may help to reduce risk identified and examined. The bibliography cites 5 sources.
Page Count:
5 pages (~225 words per page)
File: TS65_TEbangtrade.doc
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Unformatted sample text from the term paper:
to financing of foreign trade may be assessed. There are a number of risks that are present in Bangladesh. One of the first is the weakness of the regulatory systems
that are in place. The civil legal system is theoretically based on the British legal system; which is relativity aligned with the US, however, the ability to enforce contractual terms
is limited and inefficient (Heritage Foundation, 2012). This could result in US firms finding it difficult to enforce contractual terms or assert and protect their rights. The regulatory
framework is also weak in terms if anti-corruption practices (Heritage Foundation, 2012). This can pose direct and indirect risks, placing barriers in place for traders who will not indulge in
corruptive practices, for example seeing products tied up in bureaucratic red tape unless bribery payments are made. The Financial Action Task Force (FATF) also have Bangldesh on a
non compliant list, where the country is stated as having ineffective anti terrorism and failing to sufficiently criminalize terrorist financing and the related money laundering rules (FATF, 2012). This also
indicates the weaknesses in the regulatory framework. There are relativity high costs associated with trading with Bangladesh there is a weighted trade tariff at 13%, but these are accompanied
by many other barriers to trade, all of which increase the costs of trade, as well as a legal regime which fails to support free trade. Bangladesh is assessed as
the 130th freest trade economy (Heritage Foundation, 2012). Question 2 Of all the different risks some may be of more concern than others. It may be argued that the
most risky element is that difficulty in the civil legal system; this the fall back if the firm faces problems. The financing of foreign trade by US firms will unavoidably
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