FOREIGN TRADE 

 DR. SCHIVA GANDHI 



Two basic factors have continued to influence agricultural exports - world 

 economic growth and high U.S. interest rates. Over the past year, the developed 

 and developing countries have experienced stagnant to moderate economic growth. 

 High U.S. interest rates have had a twofold impact on dampening the demand for 

 U.S. agricultural products. First they have promoted rapid appreciation of the 

 U.S. dollar against major world currencies, making U.S. exports relatively more 

 expensive, and secondly the high rates have increased the borrowing costs for 

 developing countries. 



For the hundred or so Massachusetts agribusiness firms participating in our 

 export programs, this past year has been a time when developing countries have 

 assumed debts in massive proportions; that most of their revenues go in debt 

 servicing; when the U.S. dollar is a powerful giant, creating an economic havoc 

 throughout the world; when negative U.S. trade balance continues to mushroom and 

 when protectionism is rising rapidly, further stifling world commerce. Faced 

 with these harsh realities, increasing numbers of representatives of food and 

 beverage manufacturing companies as well as exporters have been contacting the 

 foreign trade section for information on the latest developments in foreign 

 markets and for assistance in developing their marketing strategies. To this 

 end they have been encouraged to focus their attention to the Pacific rim 

 countries and on the export of value added products. 



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