MINISTRY OF EDUCATION AND TRAINING
UNIVERSITY OF ECONOMIC HOCHIMINH CITY
---- K ---
PHAN MANH HA
INTERNATIONAL SETTLEMENT
OPERATION: A CASE STUDY OF
AGRIBANK CHO LON
In Banking and Finacial
Ology code: 60.31.12
MASTER’S THESIS
Supervisor : Dr.TRAN HUY HOANG
Ho Chi Minh City – 2010
i
Acknowledgment
The process of this master thesis writing was a wonderful learning experience on
my academic life which was filled with challenges and rewards. The
completion of the present study leads a new beginning and a step forward
towards my future. This preface provides a welcomed opportunity and chance to
acknowledge the help and assistance of the people who with their intellectual
insights or constructive criticism, other times in the form of friendship have helped
me to develop this research. Specially, I would like to extend my appreciation to
Mr. Jerry and Mr.Gary for their valuable and enthusiastic support of English.
First, I would like to express my sincere gratitude to supervisor, Associate
Professor Ph.D. Tran Huy Hoang at the Faculty of Banking, for his valuable
supervision, never-ending support and encouragement during this process. I am
very thankful to him, that he has given me this pleasure to use his valuable
comments, feedbacks and suggestions during the time that I have been working on
this thesis and he has presented a new world for my further academic research .
Outside of academia, I would like to thank all my friends and colleagues for
their fully support and finally, the great thanks are directed to my family; My
father; that have taught me to get the priorities straight and to focus on the whole
instead of getting lost in the details; My mother who has meant me the real
meaning of patience and helped me by her advices to have this thesis finished on
schedule and finally; my brothers and sisters for continues support along the way.
Finally warm thanks go to University of Economic HoChiMinh City for
having developed this post-graduate course in English the first time and
sharing consideration during this period of hard work.
Phan Manh Ha
August 2010
HoChiMinh City, Vietnam
ii
Table of Contents
Acknowledgment .....................................................................................................i
Table of contens ......................................................................................................ii
List of tables
....................................................................................................vii
List of diagrams ....................................................................................................vii
List of charts
.................................................................................................. viii
Introduction
......................................................................................................1
1. Rationale of thesis...............................................................................................1
2. The thesis’s research questions and research objectives: ...................................2
2.1. Research questions ......................................................................................2
2.2. Research objectives .....................................................................................2
3. Scope and limitation of thesis:............................................................................3
4. Research Methodology .......................................................................................3
5. The thesis’s structure: .........................................................................................4
Chapter 1: International settlement operation of commercial banks in context
of international economic integration .....................................................................5
1.1 Integration into the world economy in field of banking and finance ...............5
1.1.1 Common issues of integration into the world economy...........................5
1.1.2 Economic integration in field of banking and finance ..............................6
1.2 The international settlement operation of commercial banks...........................9
1.2.1. Concepts ...................................................................................................9
1.2.2. Role and the objective necessity of developing and improving
international settlement operation of commercial banks..................................10
1.2.2.1 For the economy...............................................................................11
1.2.2.2 For the enterprises............................................................................11
1.2.2.3 For the state management ................................................................12
1.2.2.4 For commercial banks......................................................................12
1.2.3 Means of international settlement operation ...........................................13
iii
1.2.3.1 Bill of exchange ...............................................................................13
1.2.3.2 Promissory Note Payment: ..............................................................15
1.2.3.3 Check ...............................................................................................15
1.2.3.4 Payment card....................................................................................16
1.2.4. Common methods of international settlement operation .......................16
1.2.4.1 Remittance .......................................................................................16
1.2.4.2 Collections .......................................................................................18
1.2.4.3 Documentary credit..........................................................................21
1.3 Factors influencing international settlement operation of commercial banks 26
1.3.1. Objective factors.....................................................................................26
1.3.1.1 Globalization and economic integration. .........................................26
1.3.1.2 Development of information technology. ........................................26
1.3.1.3. Practices and standards of international settlement operation. .......26
1.3.1.4. Level of development and open of economy..................................28
1.3.1.5. Macro economic policies of government........................................28
1.3.1.6. Competition of other commercial banks.........................................28
1.3.2. Subjective factors ...................................................................................29
1.3.2.1. Policy of customer care and developing products, services of
commercial banks ........................................................................................29
1.3.2.2. Policy of foreign affairs ..................................................................30
1.3.2.3. Development level of banking technology .....................................31
1.3.2.4. Structure of organization and management for international
settlement operation .....................................................................................31
1.3.2.5. Knowledge, ability of dealers in international settlement operation31
1.3.2.6 Other activities in relation with international settlement operation of
commercial banks ........................................................................................31
1.4 Some standards to evaluate the performance in international settlement
operation of commercial banks.............................................................................32
1.4.1. Security and exactness............................................................................32
iv
1.4.2. Quickness and Timeliness ......................................................................33
1.4.3. Logic settlement process ........................................................................33
1.4.4. Satisfaction of Customer ........................................................................34
1.5 Some experience of developing and improving international settlement
operation of other commercial banks in the world ...............................................34
1.5.1. Citi Bank.................................................................................................34
1.5.2. Hongkong and Shanghai Banking Corporation .....................................36
Conclusion of Chapter 1 .........................................................................................37
Chapter 2: Research Methodology .......................................................................38
2.1. Research design .............................................................................................38
2.2. Data collection ...............................................................................................40
2.3. Data Analysis.................................................................................................44
Conclusion of Chapter 2 .........................................................................................47
Chapter 3: Current status of international settlement operation at Agribank
Cho Lon .................................................................................................................48
3.1 Overview of organization and activities at Agribank Cho Lon......................48
3.1.1. History of foundation and development.................................................48
3.1.2. Organizational structure .........................................................................49
3.1.3. Review of some main business activities of Agribank Cho Lon ...........49
3.1.3.1. Capital Mobilization .......................................................................49
3.1.3.2. Loan ................................................................................................51
3.1.3.3. Foreign exchange trading and international settlement operation ..53
3.2 Current status of international settlement operation at Agribank Cho Lon....55
3.2.1. Legal basis of international settlement operation at this branch ............55
3.1.1.1. International legal documents .........................................................55
3.1.1.2. National legal documents................................................................56
3.2.1.3. Agribank’s documents of internal regulations of international
settlement operation .....................................................................................56
v
3.2.2. Current status of international settlement operation at Agribank Cho
Lon....................................................................................................................57
3.2.2.1. Customers of international settlement operation at this branch......57
3.2.2.2. Current status of some main methods of international settlement
operation deployed at the branch .................................................................62
Remittance ...............................................................................................62
Collection.................................................................................................65
Letter of credit .........................................................................................66
3.3 General comments of international settlement operation at Agribank Cho Lon
..............................................................................................................................68
3.3.1. The results ..............................................................................................68
3.3.2. Shortcomings..........................................................................................71
3.3.3 Causes of shortcomings...........................................................................74
3.3.3.1 Objective causes...............................................................................74
3.3.3.2. Subjective causes ............................................................................77
Conclusion of Chapter 3 .........................................................................................80
Chapter 4: Solutions for developing and improving international settlement
operation at Agribank Cho Lon ............................................................................81
4.1 Some orientation of international settlement operation at Agribank Cho Lon81
4.1.1. Some orientation of foreign economic development of Vietnam from
2006 to 2010 .................................................................................................... 81
4.1.2. Main orientation of international settlement operation at Agribank Cho
Lon....................................................................................................................82
4.2 Some viewpoint of international settlement operation ...................................83
4.3 Solutions for developing and improving international settlement operation at
Agribank Cho Lon ................................................................................................84
4.3.1. Establishing customer policy and marketing policy suitable for diffusion
of products and services of the branch .............................................................84
4.3.2. Modernization of banking technology ...................................................86
vi
4.3.3. Proposing a policy of service diversification .........................................88
4.3.4. Improving management model, procedure of international settlement
operation ...........................................................................................................90
4.3.5. Well organizing foreign exchange trading, acting on initiative to have
foreign currency source suitable for requirement of the international settlement
operation at the branch .....................................................................................93
4.3.6. Solution for increasing quality of human resource ................................94
4.3.7. Increasing quality of control and internal audit .....................................96
4.3.8. Constantly paying attention to establishment of business culture style at
the branch .........................................................................................................96
4.4 Recommendations...........................................................................................98
4.4.1. For the government, ministries, departments and industries concerned 98
4.4.2. For State bank.........................................................................................99
4.4.3. For customers .......................................................................................100
4.4.4. For Agribank ........................................................................................100
Conclusion of Chapter 4 .......................................................................................101
Conclusion .............................................................................................................102
Appendices .............................................................................................................103
List of References ..................................................................................................110
vii
List of Tables
1. Table 2.1. Exhibition of payment sales under method of remittance ...................45
2. Table 3.1. Capital source of Agribank Cho Lon in recent years ..........................50
3. Table 3.2. Some items of outstanding debts at Agribank Cho Lon 2006-2009
...................................................................................................................................52
4. Table 3.3. Some main items of foreign exchange trading and international
settlement operation at Agribank Cho Lon ........................................................54
5. Table 3.4. Sales of some main customers in international settlement operation at
the branch in 2009 ................................................................................................58
6. Table 3.5. Sales of some main import export commodities at the branch........... 61
7. Table 3.6. Payment sales under method of remittance ........................................63
8. Table 3.7. Payment sales under method of collection .........................................65
9. Table 3.8. Payment sales under method of letter of credit ..................................67
10. Table 3.9. Some indicators of loans for import and export at the branch ...........70
11. Table 3.10. Some key indicators for comparison ................................................72
12. Table 3.11. Comparison of export payment and import payment at the branch .73
List of Diagrams
1. Diagram 1.1. Process of remittance operation ....................................................17
2. Diagram 1.2. Process of collection operation ....................................................19
3. Diagram 1.3. Process of documentary credit
....................................................23
viii
List of Charts
1. Chart 3.1. Capital source of Agribank Cho Lon 2006-2009 ................................51
2. Chart 3.2. Outstanding debts at Agribank Cho Lon 2006-2009...........................53
3. Chart 3.3. Main items of foreign exchange trading and international settlement
operation at Agribank Cho Lon
........................................................54
4. Chart 3.4. Sales of some main customers in international settlement operation at
the branch in 2009 ................................................................................................59
5. Chart 3.5. Customer’s assessment of international settlement operation ............ 60
6. Chart 3.6. Sales of some main import export commodities at the branch........... 62
7. Chart 3.7. Payment sales under method of remittance ........................................64
8. Chart 3.8. Payment sales under method of collection ........................................66
9. Chart 3.9. Payment sales under method of letter of credit ..................................67
10. Chart 3.10. Some key indicators for comparison ................................................72
11. Chart 3.11. Comparison of export payment and import payment at the branch .73
1
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1. Rationale of thesis
Vietnamese economy has widely integrated itself into the regional and world
economy. Along with other activities, foreign trade has constantly affirmed to an
important role in Vietnam economic development. Commercial banks, by launching
the international settlement operation have, according to the “Open Door Policy”
on integration, become undeniably essential to the development of the economy of
this country. In addition, to better promote their role and position in speeding up
foreign trade activities, the system of commercial banks in Vietnam have
continuously worked to develope and improve the international settlement
operation. In these recent years, the efforts of the system of Vietnam commercial
banks have fostered advantageous conditions for the international settlement
operation to become increasingly enhanced day by day, fulfilling the basic
requirement of open process and integration of economy.
However, international settlement operation must undergo legal systems and
complicated overseas practices, if it was not to be fully understood, risks that
include economic, politic and social losses would inevitably arise. Lessons learned
from the past strongly suggest that the working of Vietnam commercial banks are
not to be ignored.
The international settlement operation of Agribank has now been deployed for 10
years, yet Agribank has been encountering countless difficulties and insufficiencies
in the widening of its active market share. In the context of integration into the
world economy alongside tough competition, commercial banks must incessantly
develop and widen their trade activities. Among those banks, the international
settlement operation was utilized in order to broaden and improve to meet customer
needs. Furthermore, the operation helped increase the bank’s income and enhance
2
the availability of competition. Now, however, all banks in Vietnam and Agribank
Cho Lon in particular are facing a great deal of difficulty as they put forth their
efforts to overcome this obstacle. Evaluating the efficiency of the international
settlement operation at Agribank Cho Lon leads to the realization that
improvements to this operation must be scientifically based.
From above mentioned practical issues, subject of this thesis “International
Settlement Operation – A case study of Agribank Cho Lon” was taken into
consideration for more in-depth research. This research evaluates the performance
of international settlement operation at Agribank Cho Lon, and proposes possible
solutions for the development and improvement of the operation.
2. The Research Questions and Objectives:
2.1. Research questions
A research question is the researcher’s translation of the business problem into the
need for inquiry
(Zikmund 1997, p.88). Based on this definition of research
problem leads to the following research questions:
- How can we evaluate the current status of the international settlement operation
at Cho Lon branch during the past few years?
- What were the achievements and shortcomings of the international settlement
operation at Cho Lon branch?
- How can we develop and improve the international settlement operation at Cho
Lon branch?
2.2. Research objectives
The research objective is the researcher’s version of a business problem. Once the
research questions have been stated, the research objectives are derived from the
problem definition. These objectives explain the purpose of the research in
measurable terms and define standards of what the research should accomplish
3
(Zikmund 1997, p.89). To solve the research problem delineated, this study has the
following objectives :
-
To make clear literature of international settlement operation
-
To point out factors influencing the international settlement operation
as well as standards for evaluating the quality of the international
settlement operation
-
To analyze actual efficiency of the international settlement operation
applied at Agribank Cho Lon in period of time between 2006 and
2009
-
To suggest solutions for developing and improving the international
settlement operation .
3. Scope and limitation of the thesis:
The thesis mainly focuses on development and improvement of the international
settlement operation at one bank, Agribank Cho Lon in period of time between
2006 and 2009.
4. Research Methodology
The exploratory research has been conducted for this research to clarify and
define the nature of problem. In this research, survey and secondary data
methods were applied in combination.
Survey was chosen as a research tool in this study to investigate, describe the
performance and identify the appropriate
performance
measurement
of the
international settlement operation at Agribank Cho Lon. The questionnaires were
designed to collect data related to international settlement operation at Agribank
Cho Lon. Also discussions with experts were taken to identify the appropriate
performance measurement of the international settlement operation at Agribank Cho
Lon. Surveys by questionnaires were used because they provide quick, efficient and
accurate means of accessing information about the population and the subject of
study. In addition, they are more appropriate in cases where there is a lack of
4
secondary data. In this case, secondary
data concerning performance and
performance measurement of the international settlement operation at Agribank Cho
Lon was insufficient, making it necessary to conduct a survey to gather the needed
information.
The secondary data method was also used to investigate the performance of the
international settlement operation at Agribank Cho Lon. Variables such as ratios of
import export payment, ratios of commodities, and ratios of payment methods were
derived from annual reports from Agribank. Some comparisons were depicted in
tables. Procedures of the international settlement operation were outlined by
diagrams.
Source of information: Source of data was collected from banking magazines and
annual reports from the State bank of Vietnam, annual reports from Agribank.
Limitations of data source: Data was mainly collected from a period of 4 years:
2006, 2007, 2008 and 2009.
5. The thesis’s structure:
Along with introduction, conclusion, list of tables and diagrams, list of charts, list of
references, the main body of the thesis was constructed into 4 chapters detailed as
follows:
Chapter 1: International settlement operation of commercial banks in context of
international economic integration
Chapter 2: Research Methodology
Chapter 3: Current status of international settlement operation at Agribank Cho Lon
Chapter 4: Solutions for developing and improving international settlement
operation at Agribank Cho Lon
5
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1.1 Integration into the world economy in field of banking and finance
1.1.1 Common issues of integration into the world economy
Today, the globalization makes the international economic integration become a
reality. It attracts all countries, from rich ones to poor ones and large ones to small
ones without exception. This integration is regarded as a key factor for a country’s
development. If the integration were done well, there would be extensive
opportunities for favorable social and economic development; on the contrary, any
country that fails to integrate would have little chance for economic development.
International economic integration involves a high level of international economic
cooperation. It is a process in which a country participates in a common
organization, a generally international trend. It is this process that incorporates each
country into the world economy. Integration is a global tendency which influences
all countries, even to countries that have not yet taken part in integration. As a
matter of fact, the influence of integration is very strong, not only affecting the
economy but also politics, culture and society. Any country implementing
integration must adjust its policies and laws to implement the integration process
successfully and efficiently.
This matter clearly shows that integration is a factor to development but it is only a
potential one. To turn it into the truth in strategy of economic development,
countries always have to have an art of combination between external and internal
strength to make a propulsive force for economic growth.
In fact, many countries execute open policy more deeply and obtain more economic
achievements and vice versa; however, it doesn’t imply that any country carries on
the process of open door policy and integration will achieve success immediately.
The results mainly depend on the way and art of integration of each country after
6
preparing the premises and internal conditions of the economy maturely. Theories
of international commerce from the past up to now affirm the benefit of each
country when participating in international trade. However if a country enters the
global playing-field only for the benefit of buying goods and services with good
prices, but fail to find the way to sell its goods and services, it will gain low profit in
comparison to the cost it pays. The payment balance will always be deficient,
unstable issues will always appear.
For developing countries, economic integration is a good chance to find the
opportunities to speed up their underdeveloped economy; however, because of
being poor country means that the economy of these countries will have
insufficiencies. These things limit the ability of attraction and utilization of external
sources as a target for development. Sometimes, the cost of executing the
integrative strategy is simply too expensive. Therefore, to integrate effectively,
these countries have to find the solutions for their internal problems. The process
can not be shortened, it may even have to be lengthened if there is no alternative.
However, if the internal insufficiencies were solved quickly and effectively, the
integration process would bring these countries with many opportunities to speed up
their economy, shorten the lead-time of industrialization, and keep up with
developed countries.
1.1.2 Economic integration in field of banking and finance
International economic integration happens in different fields, in which the fields of
banking and finance are both the premises and results of other fields. The nature of
integration in the field of banking and finance is a process in which countries
gradually open the door for one another to participate in the banking and financial
activities of each participating country. Because the banking and finance section is
the pharynx in economic body of each country, opening the door in this area is
always an important and sensitive problem. Activities of banking and financial
services have organic relations with other economic fields, they are also fields that
7
bring back much profit, therefore countries must always be cautious about how they
handle opening the door of this economic field.
In comparison with other economic fields, integration of banking and finance is
characteristic as follows:
First, this is the process of capital source movement among financial markets. This
can become stronger and stronger and is many times larger than the commercial
scale among countries.
Second, integration of banking and finance is both the result and motivation of the
development of technological science in the world. The development of
technological science is a factor that enhances fast and efficient integration of
banking and finance. Nowadays, transactions are effected quickly and safely:
Billions of US Dollar are dealt with among semi-global distant markets in a matter
of 30 seconds with a high level of security. Transactions can be thousands of miles
away but customers feel very close here…Obviously, technological science
“shortens” distance among people, boundaries among countries have become faint
in the age of technological scientific revolution. It is this thing that makes financial
markets very close in all aspects.
On the contrary, integration of banking and finance create the motivation for the
development of technological science day by day. Opportunities for trading in the
exchange market can happen very fast, so timing is always the key problem in
exchange trade. Customer demands in international trade always require efficiency,
accuracy and security…these requirements can only be met with using developed
technological science. The development of technological science is the premises for
banking development of traditional services as well as new service, and it increases
customer convenience in the open economy.
Third, integration of banking and finance changes the practice of monetary trade.
Because activities of banking and finance have relationships with other economic
activities, integration in this field forms a stable basis for the effective integration of
other fields. If so, regulations, laws and monetary financial standards need to be
8
modified so that they are similar to international custom and practice, by
conforming to an identical competitive environment. Trading practices in different
markets need to be changed so that they make opportunities for capital flows to
move easily across the globe.
Fourth, integration of banking and finance leads to the tendency that countries will
depend more on one another. Along with the open-door tendency of the monetary
financial market, any economy turbulence happens in one countries will in turn
affect the economics of the others. The benefit of a complete dependence among
countries is that economic development of a group of countries or of an area lead to
the development of the others. This is the result of monetary financial integration
that involves compromises between investment liberalization and free trade.
However, this also brings up some unwanted impacts: such as the situation of
inflation import, an economic crisis import that has often been termed a
phenomenon in recent years. This is the unavoidable consequence of stage of
globalization, international economic integration.
Integration in the field of banking and finance is rendering competition in this field
fiercer all the time. Unlike competition in other fields, competition in the field of
banking and finance has specific characteristics: (1) Rivals both compete and
cooperate together in the sensitive business; rivals must direct their attention to one
common sound environment to avoid a system risk which could lead to the collapse
of serial banks; (3) Competition in the environment under the control of the Central
Bank in each country or in area; (4) Competition depends not only on internal
factors but also on external ones ( business environment, country custom, financial
infrastructure,…)
For the Vietnam banking system, international integration will open opportunities
for cooperation as well as an exchange of experience. These things will help to
propose solutions and apply efficient tools in businesses to prevent risk and enhance
the prestige and position of the Vietnamese commercial banks in international
financial transactions, they will also make good conditions for capital, technology
9
and management experience. Along with the integration process, legal environment
and monetary policies of Vietnam will be improved quickly, commercial banks will
have to specialize more deeply in modern banking profession and deploy new
banking products and services for wider market share at home and abroad.
1.2 The international settlement operation of commercial banks
1.2.1. Concepts
* Settlement: There are many concepts of settlement but generally settlement is the
payment of a party to another for having used or possessed goods and services, or
some specific rights.
Settlement is the payment following each trade or exchange of goods and/or service.
Settlement is the final stage of relation between goods and money that is built on the
basis of each party’s satisfaction
* International settlement: Terms of international settlement are expressed in many
different ways:
- International settlement is the method of settlement by bank for import and export
enterprises in different countries.
- International settlement is the settlement of money in relation with trading or the
supplying of goods and/or services between organizations or individuals in this
country and those of other countries, between one country and other international
organizations. This is put into effect by banking relations of the countries involved.
In general, international settlement is the settlement of monetary obligations and
monetary requirements generating from relations between economy, commerce,
finance, and credit among international economic organizations, enterprises, and
individuals in different countries. It ends an operation process in the field of
external economy under different forms.
The nature of international settlement is an operation in which the banks are
intermediary institutions which use their experience, knowledge, and professional
10
skills make the payment safe and efficient, and also to protect the client’s benefit in
transactions of payment as well as increase the bank’s profit.
Ultimately, international settlement arises from world trade activities, it is the last
stage in the process of trading and exchanging goods and services among
organizations and individuals in different countries. If the international settlement
operation were well organized and performed quickly, safely, efficiently and
precisely, it would make an active effect to foreign trade activity of a country.
International settlement is different from domestic payment (inland operation), it
often relates closely to currency exchange among different countries. The domestic
currency with functions as means of circulation, means of payment will not excess
its value if two parties in the contract do not reach to a specific agreement. Hence ,
the currencies of foreign transaction are normally stated with precision in
international credit agreements and foreign commercial contracts by negotiating
parties. Currencies used frequently in international settlement are ones with the
ability to participate in free exchange, such as USD, GBP, JPY, and EUR. However,
USD still plays a key role in international settlement by its convenience and
efficiency in transactions performed. Now, most payments in international
settlement are by telex, SWIFT, order for collection, or order for payment among
banks concerned, therefore the ratio of cash payment is very small.
1.2.2. Role and the objective necessity of developing and improving
international settlement operation of commercial banks
Because international integration is happening intensely, each country that wants to
develop also has to have complicated and diversified international relations
concerning its economy, politics, society, culture, etc…Among them, economic
integration always plays a key role and maintains an influential position in other
fields. The process of economic integration indispensably develops demand for
payment. The more economic integration progresses, the higher the need of
international settlement. The international settlement operation has an important
11
role in ensuring the circulation of international economic relations, and promoting
the development of import and export enterprises as well as the growth of
commercial banks.
1.2.2.1 For the economy
The international settlement may be the last stage in the international exchange of
goods and services, but it is certainly one of the most important stages of all. If not
for the international settlement operations, the international commercial operations
in particular and the external economic operations in general would hardly exist,
and much less have room for development. Therefore, the development and
improvement of the international settlement operation is an objective requirement,
thereby it sets the stage for the external economy to develop. If foreign trade
develops, a country could utilize the advantages efficiently, and thus promote good
and stable economic growth, all resources would be explored and used efficiently.
1.2.2.2 For the enterprises
The international settlement is a factor directly affecting business outcomes.
Development and improvement of international settlement makes opportunities for
enterprises to participate in international commercial operations, because:
(1) If payment were effected quickly, the time for capital turnover would be
shortened, efficiency of capital would increase along with growth of sale and profit
of participating parties.
(2) Through international settlement operation, we can justify financial ability,
prestige and economic potential of each participating parties;
(3) If international settlement were effected quickly, safely and efficiently, domestic
production would then be able to export goods abroad.
In short, the international settlement is an important link that is indispensable to
foreign trade if it is seriously considered under both space and time. The more
favorable the international settlement is, the more business relations can be
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