Theory question 101
Transport, Trade and Tourism(a) What is favourable balance of trade? (b) Outline five factors which hinder high volume of trade among countries in Tropical Africa. (c) Identify four advantages of favourable balance of trade in Tropical African countries
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(a) A favourable balance of trade occurs when the value of a country's exports is greater than the value of its imports over a period.
(b) Similar products (mainly primary goods); poor transport and communication links; different currencies and exchange problems; tariffs and trade barriers; political instability and conflicts; colonial ties to Europe; low purchasing power; language barriers; smuggling.
(c) Increases foreign exchange reserves; strengthens the currency; more revenue for government; more jobs; funds for development; reduces foreign debt; encourages investment; raises standard of living.
Define with exports greater than imports.