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What is FEA?
FEA is foreign economic activities which comprise a set of functions exercised by a certain company that imports its goods into the country for subsequent selling. This concept belongs to the market sphere and is formed from entrepreneurial activities. It also includes structural ties with production. It implies the existence of legal autonomy and lawful independence of enterprises. The main instrument is commercial calculation relying on the basis of financial independence and sustainability. It is key that monetary and financial as well as material and technical aspects are taken into account.
Types of FEA
Depending on a business entity, the following types of FEA are distinguished:
- Foreign trade – that includes entrepreneurial activities within the international exchange of goods, works and services.
- International investment cooperation – it implies joining efforts for production of different products.
- Production cooperation – this type of activity applies to cooperation with foreign companies in case of joined production of some common products. Coordination of work is achieved through common planning of operations and forecasting. It is also achieved through collaborative development and provision of enterprises with all the necessary equipment. The process also includes organization of personnel training.
- Financial operations – the use of certain forms of settlement and foreign currency transactions.