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MGT1214 Refelection 4

The document discusses the negotiation of a deal between Tradium Limited of Ghana and INTIMEX Group of Vietnam. The main points are: 1) Tradium Limited will purchase 5,000 metric tons of 15% broken Vietnam jasmine rice from INTIMEX Group for $550 per metric ton, totaling $2,750,000. 2) There were three major areas of disagreement during the negotiation in Hoan Kiem District, Vietnam on June 5th, 2023. 3) Payment will be handled through an international letter of credit, involving banks in Ghana, Vietnam, and potentially a confirming bank to guarantee payment. Product quality and standards will be
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0% found this document useful (0 votes)
46 views6 pages

MGT1214 Refelection 4

The document discusses the negotiation of a deal between Tradium Limited of Ghana and INTIMEX Group of Vietnam. The main points are: 1) Tradium Limited will purchase 5,000 metric tons of 15% broken Vietnam jasmine rice from INTIMEX Group for $550 per metric ton, totaling $2,750,000. 2) There were three major areas of disagreement during the negotiation in Hoan Kiem District, Vietnam on June 5th, 2023. 3) Payment will be handled through an international letter of credit, involving banks in Ghana, Vietnam, and potentially a confirming bank to guarantee payment. Product quality and standards will be
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We take content rights seriously. If you suspect this is your content, claim it here.
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Program: IBM

Module: MGT1214 Mastering International Trade


Strategies and Tactics

Title: Assignment Reflection 4

To, Prof. Vijey Charde

Student: Shagufta Karim Dinani ID 041093865


Negotiation Deal between Tradium Limited and Intimex Group

Main Party Counterparty


Tradium Limited INTIMEX Group
Tema, Ghana Hoan Kiem District - Ha Noi city, Vietnam

Negotiation taken place at Na Hoi City of Vietnam on the 5th day of June 2023.
Deal: Purchasing 5000 MT of 15% broken Vietnam Jasmin Rice
Deal Amount: 550$ per MT = 2,750,000 USD
During the negotiation meeting, we highlighted the 3 major concerns of disagreement which are
as follows:
Reflection NO 3
Question #4 

Thinking about the context of the 3rd parties you would use? Who is going to handle which part of the
overall process? Describe in detail.

-1 Payment Terms and the parties involved in this process.


While an LC usually involves the exporter, importer and both parties below are the additional
parties are involved in the overall process.

 Issuing Bank—Importer's bank that opens the LC in Favor of the exporter.


 Nominating Bank—Exporter's bank that facilities the eventual payment from the
importer's bank.
 Advising Bank—Exporter's bank that informs the beneficiary of the opening of the LC
and verifies its authenticity.
 Confirming Bank—Exporter's bank that adds its own guarantee to pay if the importer's
bank fails to do so.
 Exporter's Bank—Generally the exporter will ask that their own bank be used by the
importer's bank as (1) advising bank and (2) confirming bank. The advising bank is
normally also given the nominated bank's role.

Role of each party in the below Chart:


-2 Product Quality/standards according to the Government Regulations:
Product Conformity:

Check if your product conforms to standards, regulations, or certifications of the foreign country.


For instance, if you are exporting to the European Union, your product may need to comply with
the European Conformity “CE mark”  or if you are exporting to China, your products may
need to comply with the China Compulsory Certification “CCC”.

In the Context of our case below are third parties involved in the process of product
testing.

1. FDA (Food and Drugs Authority)


2. PAARS (Pre-Arrival Assessment Reporting System).
3. Goods Inspection/ Examination – This examination is conducted by GSA, PPRSD, and FDA,
4. The Ministry of Health, Ministry of Trade and Industry  Trade Associations

Food Laws: The Government of Ghana’s (GOG) regulatory body responsible for food product
manufacturing, importation, exportation, advertisement, and distribution is the Food and Drugs
Board (FDB). The Food and Drugs Board was established and became fully operational in
August 1997. The FDB was established to protect and promote public health by ensuring that
food and drugs consumed in Ghana are wholesome and safe.

The Food and Drugs law was passed in 1992. All food products imported, advertised, sold, or
distributed in the country must first be registered with the Food and Drugs Board. A certificate
with a registration number is then issued with respect to the product. In addition, only
companies duly registered by the Registrar General’s Department shall be permitted to import
food and drugs.

Inspection Laws and parties: Now all imports to Ghana are subject to Destination Inspection
unless specifically exempted by the Ministry of Trade and Industry. There are no threshold
exemptions, hence all imports are subject to inspection, regardless of their value. Inspection
charges are currently pegged at 1% CIF value.

1. COG: The GOG has appointed two companies to provide destination inspection in
Ghana
2. (GSL) is responsible for sea freight and Ghana Standards Board and Bureau Veritas
3. (GSBV) is responsible for shipments arriving by air and land. In addition, depending on
the imported goods, clearances may require the approval of FDB, Ghana Standards
Board, National Drug and Narcotics Board and other agencies at the ports of Ghana.
Import Duties and Collections: The Ghana Customs Excise and Preventive Service
(CEPS) is the GOG institution responsible for the collection of import duty.
Ghana Trade Net: was established in 2001 to provide a fully integrated customs management
software connected over a network to various operators who interact with Customs in the
processing of import and export transactions to and from Ghana.
Some of these operators include banks, shipping companies, certification, and licensing
agencies as well as users of trade information.
The Ghana Trade Net is made up of two main components:
-1 The Ghana Customs Management System (GCMS), which provides the CEPS with a fully
integrated computerized system for the processing and management of Customs Declarations
and related activities. This system is designed to work in an Electronic Data Interchange (EDI)
environment, where Manifests and Single Administrative Documents (SAD) are electronically
received and automatically processed. In 2003 Ghana moved away from the use of ASYCUDA
in processing Customs Declarations. Instead, Ghana adopted and modified a Direct Trader
Input system (DTI) that provides for online submission of custom documents and duty
payments.

-2 Ghana Community Network (GCNet) comes as a third party for the seamless
documentation.

GCNet is a platform enabling GCMS to share data and other relevant information with all the parties
involved in the processing of trade documents and customs clearances. The GCNet operates a seamless
electronic system that links all trade operators, revenue agencies, and regulatory bodies through a
"Single Window” system. The current set up contrasts sharply with the pre-GCNet situation, when trade
operators had to shuttle from one agency to the other, while processing their trade and Customs
transactions causing delays.

Utilizing GCNet/GCSM, consignments are being cleared within 1-2 days as opposed to an average of 2-3
weeks.
References:
https://www.trade.gov/preparing-product-export
https://agriexchange.apeda.gov.in/countrysearchnew/IR_Standards/Import_Regulation/
Ghana.pdf
https://www.infoentrepreneurs.org/en/guides/negotiate-the-right-deal-with-suppliers/
https://www.ncbi.nlm.nih.gov/pmc/articles/PMC8197968/#:~:text=According%20to
%20%5B9%2C13%2C,the%20development%20of%20fungal%20invasion.
https://www.cbc.ca/news/indigenous/kawartha-lakes-pigeon-lake-wild-rice-dispute-1.4894495
https://hbr.org/2015/07/how-to-negotiate-with-powerful-suppliers
https://www.wonnapob.com/certification.html
https://howtoexportimport.com/Is-Letter-of-Credit-LC-a-safe-mode-of-payment-for--113.aspx
https://howtoexportimport.com/Is-Letter-of-Credit-LC-safe-for-an-Importer--425.aspx

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