Invisible exports are intangible items leaving a country, such as balance of payments, foreign payments, licenses, and repatriation of earnings. Economists track these exports, which can involve services rather than goods, and can indicate a country’s strength. Examples include outsourcing and tourism.
Invisible exports generally represent the intangible items leaving a country, which may or may not be tabulated in the country’s export calculations. Examples of these items may include balance of payments, foreign payments, licenses, and repatriation of earnings, among others. Economists keep track of invisible exports, as these items have an effect on the country’s economy, although they may be lower than traditional exports. In many cases, these types of export involve services rather than goods, which come from a variety of different sectors that fall outside of manufacturing. Many different countries may export some type of service into their economies.
A common group of invisible exports is the outsourcing of services from one nation to another. For example, a company with little manufacturing may export services such as call centers or technical support. This can fall under the intangibles that economists look at when delving into the types of goods and services that a nation can offer to other economies. The intangible service is usually not subject to normal import and export rules, which can make calculating a true export difficult. In some cases, these types of services may be unable to be accurately represented in export calculations for economic purposes.
Another group of invisible exports that may not be represented in traditional export calculations include the repatriation of earnings. When a foreign company has a business location in an economy, the profits from this division often return to the country of origin. The result is income that leaves one economy and doesn’t really provide any positive impact on the foreign economy. Repatriation essentially takes money earned from one economy and places it in another. In many cases, it may be easier for economists to define the amount of unrepatriated funds that will eventually go to the home country of foreign companies.
Invisible exports can indicate that a country is actually much stronger than first believed because of these intangible services. For example, tourism may fall into the invisible export category, with many different foreign people visiting a country. When tourism is at its peak, more foreign money pours into a country’s economy as more buyers enter the market buying souvenirs and other goods and services. Although many countries may not realize the effects of tourism, it can have a strong effect on a nation’s economy. Large countries with other sources of export may not fully realize the effects of tourism.
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