The import is the activity of buying products or services produced by other countries.
The export is the term used when products or services are sold abroad.
The difference between import and export is the type and destination of the transaction. While import is about buying goods, export is about selling them. On the other hand, while the import tries to cover the internal demand of a country with certain items of products, the export covers the demands of a foreign country.
Import and export are two activities related to international trade, and are carried out between countries or individuals.
| import | Export | |
|---|---|---|
| definition | Entry of goods or services into a country from abroad as a result of international commercial transactions or exchanges. | Output of goods or services from a country to a foreign country, as a result of international transactions or exchanges. |
| Goal | Meet the demand for products that cannot be produced in the country. | Enter new markets, find demand for a certain product and reduce the surplus. |
| Origin of the goods or services | Produced abroad. | Produced in national territory. |
What is import?
Importation is related to the entry of goods or services into national territory, coming from other countries.
The main reason for importing products is meet the demand for goods that cannot be produced in the internal market. This can happen in the case of technology, when resources are outdated or expensive, or when a certain product or service cannot be produced internally due to a lack of skills or resources.
The level of import directly depends on the exchange rate of the local currency. If the local currency is strong (which means that its currency has a good exchange rate compared to other currencies), you can buy more foreign currencies and therefore more foreign goods, then the level of imports increases. If your local currency is weak, the level of imports tends to decrease.
Import example
In Mexico, according to the Secretary of Economy of this country, the most imported products are:
- electrical machinery,
- petroleum oils,
- plastics,
- auto parts,
- iron,
- steel
These types of goods and raw materials are required in Mexico, but the country does not produce them or the production is too low to meet domestic demand, so the solution is to buy from other countries.
What is export?
Exporting occurs when domestic companies sell products or services abroad.
There are several reasons why companies decide to export their products. First, they may want to enter new markets, and thus expand and internationalize. Some companies also decide to export to meet a demand that exists abroad, but does not exist internally. Exporting is also a way to reduce the surplus of domestic supply and make production more efficient.
The level of export is also strictly related to the exchange rate of the local currency. If the exchange rate is weak, meaning that a country with a strong currency can buy more of the currency and goods, the level of exports increases.
Export example
According to the Secretary of Agriculture, Livestock, Rural Development, Fisheries and Food of Mexico (Sagarpa), this country stands out for the export of items such as:
- avocados,
- beer,
- tomato,
- tequila,
- beef
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