Modelling the Risks of International Trade Contracts
Iryna Bashynska1, Olena Sokhatska2, Tetiana Stepanova3, Marina Malanchuk4, Sergii Rybianets5, Oksana Sobol6
1Iryna Bashynska, Department of Accounting, Analysis and Audit, Odessa National Polytechnic University, Odessa, Ukraine.
2Olena Sokhatska, Department International Economic Relations, Ternopil National Economic University, Ternopil, Ukraine.
3Tetiana Stepanova, Department of Administrative and Commercial Law, Odesa I.I. Mechnikov National University, Ukraine, Odesa, Ukraine.
4Marina Malanchuk, Department of Economics and Financial Support, National University of Defense of Ukraine named after Ivan Chernyakhovsky, Kyiv, Ukraine.
5Sergii Rybianets, Department of Criminal Law Disciplines, Dnipropetrovsk State University of Internal Affairs, Dnipro, Ukraine.
6Oksana Sobol, Department of Criminal Law Disciplines, Dnipropetrovsk State University of Internal Affairs, Dnipro, Ukraine.
Manuscript received on 29 August 2019. | Revised Manuscript received on 06 September 2019. | Manuscript published on 30 September 2019. | PP: 2815-2820 | Volume-8 Issue-11, September 2019. | Retrieval Number: K23130981119/2019©BEIESP | DOI: 10.35940/ijitee.K2313.0981119
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© The Authors. Blue Eyes Intelligence Engineering and Sciences Publication (BEIESP). This is an open access article under the CC-BY-NC-ND license (http://creativecommons.org/licenses/by-nc-nd/4.0/)
Abstract: Current globalization trends in the global economy and trade, as well as integration processes, have significantly aggravated competition and complicated the nature of the foreign economic interaction of companies from different countries. At the same time, the ambiguity in the development of these processes is expressed by the increased degree of probability of the influence of numerous uncertainty factors in international markets, generating a set of specific foreign trade risks and financial losses; which are exposed to most foreign and domestic companies engaged in foreign economic activity. The contract risk management methodology proposed in the article will allow the decision-maker: to avoid opportunity costs and direct costs, as well as take preventive measures commensurate with the risks. A company may consider several alternative strategies: attract a contractor (accept risk); attract a contractor while maintaining control over business processes (mitigate the risk) and provide the service yourself (avoid the risk associated with attracting contractors).
Keywords: International Trade, Contracts, Modeling, Risks.
Scope of the Article: Software Analysis, Design and Modelling