New-York tribune., 1920-10-26
Exporters Urged to
Quote i'm Currency
Familiar to BUYERS
Department of Commerce
Sees Benefit to American
Foreign Trade Through
Following Out This Plan

One OF the advantages Of direct rep
resentation of American firms abroad
Is the practice OF quoting American
products in the currencies with which
'ne prospective customer is familiar.
say statement issued by the Depart
ment OF Commerce, based on a number
OF reports from American consuls
PERSIAN exporter of rugs quoting
ms goods to a Chicago buyer in the
silver standard currency of Persia
would be as inapt, the statement points
OUT, as an American exporter of agri-
cultural machinery quoting to Persian
buyers in the American gold currency.
Goods to be offered in Persia might
the British sovereign is familiar to all
PERSIAN importers. and, therefore, Il
quotation in British currency would
present no ifficulty.
In 1913 Persia imported about one
hundred and nine times as much from
the British empire as from the United
States. and it may be safely assumed
that the great bulk of the British goods
was quoted in sterling
One of the advantages Of quoting
American goods in foreign currencies
is the protecting Of the foreign
importer from excessive exchange
charges. In the case of Persia, for ex-
ample, the Imperial Bank Of Persia,
reputed TO be British institution. is
reported to have q monopoly of the
foreign exchange business Of the coun-
try
The influence Of British trade
rivalry. together with the magnitude Of
Anglo Persian trade. is said to have
had the effect Of making the difference
between the banks buying and selling
rates for dollar exchange considerably
less than the difference between the
banks buying and selling rates for
sterling exchange. The result has been
tendency to make it cost the Persian
importer more 20 buy goods from the
United States than from England, other
things being equal.
On May y, 1920, the French authori-
ties in Syria introduced the franc cur
rency into the regions to be inundated
and imposed a penalty for refusal to
accept it. The new currency IS, at the
outset, paper money secured by French
paper money deposited at Paris.
That this measure will increase the
Syrians' familiarity with franc cur
rency, which they acquired in pre-
war days when France was said to
have sphere of interest in Syria, is
beyond doubt.
That it will both cheaper franc ex-
cNAlSc AHN StedI!y leoSei HuCIudlioi
of franc exchange in Syria is equally
evident. Obviously, then the Ameri
can exporter should quote his goods
in francs and arrange to accept pay
meNt, by documentary drafts or other
wise, at an American bank in Paris.
The existence of two competing
French banks in Syria, coupled with
the absence of an American bank, fur
ther insures the fact that the charges
for franc exchange will be lower than
the charges for dollar exchange. AS
in Persia, the relatively small volume
OF American business is also an ele-
ment in the situation.
The policy of quoting American
goods in the foreign currency, with
which the customer is most familiar
applies to Mesopotamia, Morocco,
Tripoh, Algeria, Formosa, or, in gen
eral, to any dependency, mandate
region, or sphere Of interest in which
no American bank Is located In
such territories this policy protects
the foreign customer from high or
discriminatory exchange charges and
serves his convenience in other ways.