Promoting Countries"

Imports from Developing A Marketing Perspective

Geir Gripsrud NORWEGIAN SCHOOL OF MANAGEMENT, OsLO, NORWAY

Gabriel R. G. Benito I~STFOLD COLLEGE, HALDEN, NORWAY

ELSEVIER

Expanding exports from developing countries may be instrumental in achieving economic growth in such countries. Several developed countries have established import promotion offices in order to increase imports from developing countries. In this article export is analyzed as an exchange relationship between exporters and importers and the potential pay-off of import promotion is underlined. The activities of the NorwegLan import promotion o~ice NOR/MPOD are described, with particular emphasis placed upon efforts directed toward importers, such as the marketing support scheme and the import guarantee scheme, j BUSN aES 1995. 3 2 . 1 4 1 - 1 4 8

though developing countries are increasing their share of world trade, international trade is still dominated by the high-income developed market economies. Ac-

cording to recent statistics, 75% of total world exports of merchandise in 1989 were from OECD member countries. However, in the period from 1980-89 the average annual growth rate of exports experienced by low- and medium-income economies was significantly higher than that realized by high income economies (mainly OECD countries) and thus reversing the trend prevailing in the period 1965-80 (The World Bank, 1991, pp. 230-231). The increased participation in international trade by low- and medium-income countries is particularly evident in manufactured products, where developing countries increased their share of total world exports in manufactured products from 7.5% in 1965 to 17.7% in 1985 (Seringhaus and Rosson, 1990, p. 72).

The role of external trade policy in fostering development has long been discussed in the literature (Krueger, 1990). Developing countries have pursued different international trade policies that are sometimes classified according to their respective outward or inward orientation. Outwardly oriented countries emphasize trade liberalization and export-led devel- opment, whereas inwardly oriented countries give priority to import substitution. The empirical evidence now available indicates that countries with an outward orientation achieve faster growth in terms of a number of economic variables, including GNP per capita, manufactured exports and employ-

Address correspondence to Geir Gripsrud, Department of Marketing and Logistics, Norwegian School of Management, RO. Box 580, N-1301 Sandvika, Norway.

Journal of Business Research 32, 141-148 (1995) © 1995 Elsevier Science Inc. 655 Avenue of the Americas, New York, NY 10010

ment in manufacturing (Greenaway and Reed, 1990; World Bank, 1987). Economic growth has in turn been shown to have a positive effect on other dimensions of development, such as the satisfaction of basic needs (Mullen, 1993).

The realization that expanding exports is instrumental to achieve further development, has induced governments in a number of developing countries to establish various kinds of export promotion agencies (Dominguez and Sequeira, 1991; Seringhaus and Rosson, 1990). Such export promotion organi- zations (EPOs) are the counterpart of similar institutions in oper- ation in most developed countries. The promotion of exports from developing countries is assisted by the International Trade Center (ITC), created in 1964 by GATT and operated jointly, since 1968, by UNCTAD and GATT. From the initial focus on training and information support for export promotion plan- ning, the scope of activities performed by ITC has been extended. Activities are presently carried out in eight subprograms, cover- ing a wide range of activities (International Trade Center, 1992a). A third type of institution, in addition to the export promotion agencies in developing countries and the International Trade Center, is also involved in promoting exports from developing countries. In more than 20 industrialized countries national agencies exist with a specific mandate to promote exports from developing countries into their markets (International Trade Center, 1992b). These institutions are generally referred to as import promotion offices (IPOs), and provide information and marketing support services for developing country exporters. Some of the import promotion offices, in particular NORIM- POD in Norway, also provide marketing support to importers of products from developing countries.

To achieve export from a developing country to a high- income country an exchange must take place between a seller located in a developing country and a buyer located in an in- dustrialized country. This exchange process may be stimulated by activities directed both to the seller and to the buyer. Activi- ties directed to the seller may be classified as export promo- tion, whereas activities directed to the buyer are referred to as import promotion. Obviously, export and import promo- tion may complement each other in achieving increased ex- ports from developing to developed countries. So far, efforts have mainly been directed to export promotion.

In the next section a short review of the literature on trade

ISSN 0148-2963/95/$9.50 SSDI 0148-2963(94)00036-E

142 J Busn Res G. Gripsrud and G. R. G. Benito 1995:32:141-148

promotion is undertaken. Based upon received marketing the- ory, a theoretical framework for analyzing the complex exchange process involved in promoting exports from developing to developed countries is then proposed. The framework suggests that import promotion in developed countries should sup- plement conventional export promotion activities in devel- oping countries. The import promotion office in Norway- NORIMPOD-is then described to illustrate an application of the framework. In the last section a summary is given and direc- tions for future research discussed.

Literature Review Development economics usually distinguishes between export- promoting and import-substituting strategies as two different trade policies pursued by developing countries in order to fos- ter economic growth (Bhagwati, 1990; Krueger, 1990). The two strategies, which are frequently termed as "outward orienta- tion" versus "inward orientation," differ along a number of dimensions. The most important among these are the effective rate of protection, the use of direct controls such as quotas and import licenses, the use of export incentives and the degree of exchange rate overvaluation (Evans, 1989). Import-substi- tuting policies are rooted in a belief that protectionist measures should be used in order to stimulate domestic production, which in turn is expected to be conducive to growth. Conversely, export-promoting policies are based on the view that trade liber- alization in general, and encouragement to exports in particu- lar, is the best strategy to achieve growth. According to a recent review of empirical studies, it appears that an outward orien- tation, i.e., export-promoting strategy, generally is more suc- cessful than an inward orientation, i.e., import-substituting strategy, in achieving economic growth (Greenaway and Reed, 1990). Nevertheless, the case in favor of an outward orienta- tion may not be clear-cut. For example, Helleiner (1986) finds no support for a positive relationship between outward orien- tation and growth for the group of countries with the lowest income, thus suggesting that a certain degree of economic de- velopment may be a necessary condition for successful im- plementation of an outwardly oriented trade policy. Further- more, Singer and Gray (1988) report that the relationship between an outward orientation and growth appears to be strong only under favorable market conditions, which indicates that changes in world demand have a larger impact on export per- formance than changes in trade policy. Liberalization programs may also fail due to bad timing of, and/or lack of commitment to, liberalization measures (Krueger, 1990; Kumcu and Kumcu, 1991; Levy, 1993). More specifically, Kumcu and Kumcu (1991) show in their study of Turkey's liberalization program in the 1980s that the success of an export-promotion strategy depends on the ability to keep export prices internationally competitive with a realistic exchange rate policy.

Most of the literature on trade and development has focused on trade policy at a macro level. However, there is increasing interest in the role of micro-level factors (Dominguez and Se-

queira, 1993). Export activity is, after all, the result of a deci- sion process in the individual companies, a process whereby managers evaluate the benefits and costs of exporting. Research has shown that managers perceive a number of barriers to ex- porting, including barriers not captured by measures such as the effective exchange rate (Bauerschmidt, Sullivan, and Gil- lespie, 1985; Cavusgil and Nevin, 1981). This calls for govern- ment involvement in export promotion that goes beyond macro- economic policy measures. Export promotion support to the business community has been available since the turn of the century in industrialized countries (Seringhaus and Botschen, 1991). The aim of such measures is a reduction of the perceived costs of engaging in exporting activity by individual companies.

Authors reviewing the literature on export barriers have used slightly different categories of barriers. Seringhaus and Rosson (1990) contend that three main types of barriers are perceived by managers: motivational, informational, and operational/re- source based. Ramaswani and Yang (1990) discuss four cate- gories of barriers: export knowledge, internal resource con- straints, procedural constraints, and exogenous barriers. The importance of the various barriers may vary with variables such as industry, foreign market, firm size, export experience and manager characteristics (Gripsrud, 1990).

Various attempts have been made to categorize the export promotion measures typically employed in different countries. Elvey (1990), in her analysis of the trade promotion and as- sistance activities in eight medium to high income countries (,Japan, South Korea, Singapore, Canada, France, West Germany, Italy, and the United Kingdom), concludes that the promotional activities may be grouped into four categories:

1. Export information and advice: information and advi- sory services for firms with no or little experience of export.

2. Production support: production planning and product modification advice for firms that have decided to export.

3. Marketing support: market information and market re- search, location of customers and representatives (net- working), feasibility studies, delegation visits, display products at trade fairs, exhibitions and trade centers.

4. Finance and guarantees: export credit guarantees against political and commercial risk, direct loans, interest sub- sidies, rediscounting, currency exchange permits, insur- ance, tax incentives and subsidies in general.

The main assistance provided in most of the eight countries she surveyed was in the area of marketing support. However, different countries seem to favor a different mix of promotional efforts. France, for instance seems to rely mainly on financial measures, and Japan and France are the only countries, among the ones surveyed, which use production support.

In their survey of export promotion in the developing world, Seringhaus and Rosson (1990) give a comprehensive review of the activities of the International Trade Center (ITC) as well as the efforts of the export promotion organizations established in individual developing countries. Generally, the types of

Promoting Imports from Developing Countries J Busn Res 143 1995:32:141-148

promotional activities provided to exporters in developing countries are similar to those which are found in developed countries. Comparing the surveys of Elvey (1990) and Ser- inghaus and Rosson (1990) it may seem that the EPOs in de- veloping countries typically are more heavily involved in policy recommendation/formulation and less involved in providing financial support than EPOs in industrialized countries.

In addition to the EPOs in developing countries, assistance to exporters in developing countries is also provided by spe- cial agencies in developed countries working to promote im- ports from developing countries (Melchior, 1987). Currently, more than 20 industrialized countries have import promotion offices (International Trade Center, 1992b). The largest import promotion offices are found in the Netherlands and in Sweden, followed by the agencies of Canada, United Kingdom, Finland, Denmark, and Norway. These agencies provide a range of ser- vices, such as supplying trade information to importers and exporters, supporting trade fair participation and arranging seminars for exporters from developing countries. Some agen- cies also provide training and education to exporters from such countries.

It appears that trade promotion-undertaken by EPOs as well as IPOs-has focused on assisting individual exporters, and that little, if any, effort has been directed toward generating demand in foreign markets. The literature on country-of-origin effects in international marketing (Bilkey and Nes, 1982; Han and Terp- stra, 1988; Johansson, 1989), suggests that the image of a par- ticular country may affect buyers' interest in products from a given country. Research findings indicate that country-of-origin effects may vary across product categories (Kaynak and Cavusgil, 1983), but the country-of-origin image of a given country may still be present across product categories. Developing countries may be particularly vulnerable to country-of-origin effects, which calls for an effort also on the demand side in order to increase exports from these countries.

Theoretical Framework From a marketing perspective trade, as well as trade promo- tion, should be analyzed within an exchange framework. Most contemporary definitions of marketing focus on exchange, and it has been maintained that the analysis of how exchanges are created, resolved, or avoided is at the heart of marketing the- ory (Bagozzi, 1975). Exchanges range from spot transactions with limited or no investments in the relationship by the par- ties involved, to exchanges that are part of a long-term ongoing process between the parties (Hallen, Johanson, and Seyed- Mohamed, 1991). Exchanges may also be classified according to the number of parties involved and the type of relationships among the participants. The classic case of exchange discussed in marketing is restricted exchange where two parties are in- volved, e.g., an exporter and an importer. In this type of ex- change a great deal of importance is attached to maintaining equality, especially if exchanges take place within an ongoing relationship.

Complex exchange, as defined by Bagozzi (1975) is "a sys- tem of mutual relationships between at least three parties. Each social actor is involved in at least one direct exchange, while the entire system is organized by an interconnecting web of relationships" (p. 34). Government efforts to promote trade should be regarded as a case of complex exchange. Typically, government institutions interact with companies in develop- ing countries to promote exports to developed countries. The prevailing system of relationships is shown in Figure 1.

Potential and actual exporters in developing countries re- ceive various kinds of support from three different types of agen- cies: national export promotion offices in developing countries, the International Trade Center, and import promotion offices in developed countries. Between the exporters and the importers products are exchanged for money. The exporters provide the government in the developing countries with an improved trade balance and the means to further economic growth. In a com- plex exchange process maintaining quid pro quo is less essential than in restricted exchange, and resources are obviously spent on export support to companies that do not pay off in terms of an improved trade balance in every case, at least in the short-run.

The system of exchange relationships outlined in Figure 1 represents a narrow concept of export promotion from develop- ing countries, where national and international agencies (ITC) are only interacting with companies from developing nations (potential or actual exporters). In order to obtain a compre- hensive view of the complex exchange process involved, the framework needs to be extended in two directions (Gripsrud, 1992). First, exports from developing countries to developed market economies are heavily influenced by trade regulations, tariffs, etc. The governments in developing countries are work- ing, both in bilateral and multilateral contexts (e.g., GATT), with governments in developed countries to improve export condi- tions. Second, within the prevailing international trade regime the potential contribution of import promotion in stimulating

~ ~ * E x p o r t promotion office

*ITC

oved suv I I ao

[ developing I..

Importers in developed countries 1

Figure 1. Conventional model of promotion of exports from de- veloping to developed countries.

144 J Busn Res G. Gripsrud and G. R. G. Benito 1995:32:141-148

*Export promotion office

*ITC *IPOs

~t Improved Irade Support ] balance

exporters m developing 1-- "l country J~ Money ]

Support

I Importers in developed countries

L

Promotion

~ Ultimate buyers in developed countries 1

Figure 2. Extended model of export promotion and im- port promotion to increase exports from developing to de- veloped countries.

exports should be acknowledged. Exports from developing countries may be increased by well-designed promotion strate- gies directed towards potential and/or actual importers, as well as toward the ultimate buyers, in developed countries. Import promotion offices in developed countries may take on the pri- mary responsibility for such activities. The most prominent ex- ample of this approach seems to be the activities of the import promotion office in Norway, NORIMPOD. The extended model of the complex exchange process involved in stimulating ex- ports from developing to developed countries is outlined in Figure 2.

In order to increase exports to developed countries the im- porters and final buyers must consider the products imported from developing nations attractive and worth buying. An im- port promotion office may assist in this process by providing various types of marketing support for potential and/or actual importers, at least in the introductory stage of a new product. For many products, in particular products not usually associated with developing countries, sales will probably be hampered by country-of-origin effects. Import promotion offices should map the image of particular developing countries in the relevant target groups, and if necessary, stimulate demand by altering the ex- isting images.

The proposed framework suggests a division of labor among the various national and international agencies in stimulating the exchange processes needed to achieve a growth in exports from developing countries, and thereby to increase their in- come. The exchange perspective advanced here is based upon a marketing approach to the subject matter. Based upon this framework it follows that import promotion in developed coun- tries should supplement export promotion in developing coun- tries.

Import Promotion: The Case of NORIMPOD The extended model of export and import promotion outlined in the previous section, represents an adaptation of basic mar- keting concepts to the activities performed by the Norwegian Import Promotion Office for Products from Developing Coun- tries-NORIMPOD. In this section, an overview of the devel- opment and activities of this office will be presented. The in-

formation has been gathered by personal interviews with the Head of the office as well as from various written sources.

Background At the end of the 1960s the economic prospects of the develop- ing countries caused increased concern in many industrialized countries, and in 1972 UNCTAD III addressed the need for promoting exports from developing countries. In 1975 an im- port promotion office was established in Sweden, and the Nor- wegian counterpart followed suit in 1977. For the first three years NORIMPOD functioned on a temporary basis, but an evaluation of the trial period resulted in a permanent status for the office from 1980 onward.

Initially, the office was an independent institution affiliated to the Ministry of Commerce and Shipping, and the activities were geared more toward assisting exporters from developing countries than the case is today. A review of the performance of the office and its institutional affiliation caused a transfer of the office from the Ministry of Commerce and Shipping to the Ministry of Development Cooperation in 1984. As a conse- quence of this transfer, the initial semi-independent status of NORIMPOD with a board consisting of representatives from public authorities as well as private industry was changed. Presently, NORIMPOD is an office within the Department of Industry Development in the Norwegian Agency for Develop- ment Cooperation (NORAD). The size of the office, and the re- sources available for its activities, have always been limited. Presently, the office consists of four employees and the budget- apart from administrative expenses-amounts to approximately 8 million Norwegian kroner (1 US $ = 7 NOK).

Scope of Products and Countries Served In 1971 the Norwegian Generalized System of Preferences (GSP) was introduced, granting duty-free entry to Norway on a unilateral basis for a wide range of manufactured goods and agricultural products originating in developing countries. Ad- ditionally, countries classified by the United Nations General Assembly as Least Developed Countries (LDCs), are under the Norwegian GSP scheme, granted duty free entry for all originat- ing products. Still, quotas and other quantitative restrictions apply to many agricultural and textile products.

The scope of NORIMPOD's activities is directed to products

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imported directly from a company located in a developed coun- try. However, the policy guidelines for NORIMPOD have, until recently, implied that the office should concentrate its efforts on promoting imports from the LDCs, but primarily on im- ports from the nine countries (Bangladesh, Botswana, India, Kenya, Mozambique, Pakistan, Sri Lanka, Tanzania, and Zam- bia) selected as main cooperative partners by the Norwegian government. Altogether, this amounts to some 55 countries. A complicating factor for NORIMPOD has been the fact that even if the LDCs are granted preferential treatment for all prod- ucts, as a general rule they do not have many products to offer that would be attractive to the Norwegian market. Addition- ally, the quantitative restrictions on imports applying to many agricultural and textile products have been one of the main ob- stacles to generating increased imports.

In 1991 NORIMPOD was allowed to actively promote im- ports from developing countries which are neither LDCs nor among Norway's main cooperative partners. At the same time, some of the quantitative restrictions on imports of textiles were abandoned. As a result, the scope of countries and products eligible for support has recently been extended. As an exam- pie, in the last couple of years NORIMPOD has devoted much effort to increase imports from countries like Indonesia, the Philippines, and Thailand. These countries were previously not considered eligible for active support.

The activities carried out by NORIMPOD may be classified into three broad categories as outlined in Figure 2 in the previ- ous section. In each category, measures requiring active involve- ment by NORIMPOD are restricted to the countries discussed above. Information services, on the other hand, are provided to exporters and importers engaged in promoting exports from all developing countries to Norway.

Support to Potential/Actual Exporters Measures aimed at assisting exporters and potential exporters in developing countries has dominated the work of most IPOs according to Melchior (1987). The directory of IPOs published by ITC (1992b) indicates that such assistance still dominates the efforts of most IPOs. In NORIMPOD the direct support to exporters is not the main activity, although it is considered im- portant. Four types of information measures may be classified as aimed primarily at supporting actual or potential exporters.

First, brochures and booklets giving advice on how to enter the Norwegian market are published. A comprehensive "Guide for export to Norway" is available, as well as the brochure "How to make a business offer." Surveys of the Norwegian market for specific products are also distributed. Recent examples in- clude market surveys for coffee, tea, canned fruit, and textiles.

Second, export delegations from developing countries, as well as individual exporters, are being received by NORIMPOD and meetings are set up with' Norwegian importers. Because the ini- tiative is taken by exporters, it seems reasonable to classify this type of activity as support to exporters. Such assistance is provided to exporters from all developing countries.

Third, seminars for exporters and would-be exporters have been arranged in a number of developing countries, usually focusing on specific product markets. Such seminars are usu- ally a joint effort with IPOs from the other Nordic countries. Recently, this type of assistance has become less frequent.

Fourth, to a certain extent NORIMPOD provides advice on product development, in particular in certain LDCs. The aim of this effort is to increase the quality of the products selected, and to adapt them to the standards demanded in Norway. Ex- ternal consultants have been engaged to achieve this purpose, but activity in this area has also declined in recent years.

Support to Importers The support provided to potential and actual importers con- stitutes the major share of activities carried out by NORIMPOD, and sets it apart from the IPOs in other countries. Correspond- ing to the information provided to exporters, information about business opportunities in the developing countries is provided to the importers in various ways.

Written information is available in brochures and booklets, but the main vehicle for disseminating information is the quar- terly publication Nortrade which is distributed free of charge to about 7000 subscribers. An essential part of this publication consists of product offers from producers and exporters in de- veloping countries. Such offers are submitted to Nortrade by the companies, but are screened by the office before publica- tion. The number of offers received has doubled in the last cou- ple of years, and in 1992 about 5600 offers were received. As a more rigorous screening procedure has been implemented, the number of offers published in Nortrade have been reduced. The remaining offers are made available to importers upon re- quest.

Other ways of providing information to importers are also utilized by NORIMPOD. In collaboration with The National As- sociation of Wholesalers and Retailers, seminars are arranged for companies interested in initiating imports from developing countries. In addition, the office gives advice to companies on an individual basis and a showroom is available to exhibit sam- ples of products from developing countries. Exhibitions focus- ing on particular product groups are displayed regularly and potential importers invited. The exhibitions of products in the show-room is now regarded by NORIMPOD as one of the most important measures to promote imports. Recent exhibitions in- clude product groups like sportswear and sports equipment as well as gardening equipment.

Apart from the general and product related information provided to potential importers in Norway, three additional types of support to the importers are an essential part of the work carried out by the office: purchasing missions, the im- port guarantee scheme and the marketing support scheme.

PURCHASING MISSIONS. It has been recognized that potential importers need to explore and assess the quality of the prod- ucts and get to know the exporters first hand. The products offered in Nortrade and the goods exhibited in the showroom

146 J Busn Res G. Gripsrud and G. R. G. Benito 1995:32:141-148

may create awareness and initial interest but additional effort is often needed to carry the interest further to the stage where an actual order is placed. To accomplish this, a number of pur- chasing missions for specific product groups and countries are organized each year. NORIMPOD covers 50% of the costs in- curred by the importers participating in such purchasing mis- sions organized by the office. Preceding a purchase mission a fact-finding journey has usually taken place, identifying rele- vant companies to be visited by the importers. In the last cou- ple of years, two to three purchasing missions have been orga- nized each year.

THE IMPORT GUARANTEE SCHEME. The risk of delayed deliv- ery and product deficiencies may act as a barrier to increased imports from developing countries. The import guarantee scheme was established in the fall of 1981 and the importers have since then been able to apply for a guarantee from NORIM- POD to cover 90% of potential losses. NORIMPOD is the only import promotion office which provides this type of support. Guarantees amounting to NOK 83 million have been granted since the scheme was introduced, whereas the total losses ex- perienced are about 1%. In 1992 guarantees were issued to 19 importers, totalling NOK 16.1 million. As can be seen from Ta- ble 1, the amount of guarantees granted each year has varied considerably over the period 1981-92. The same applies to the number of applications received each year, which has var- ied between 7 and 36. When assessing the adoption of the im- port guarantee scheme by importers it should be kept in mind that the number of developing countries eligible for guarantees has been limited.

THE MARKETING SUPPORT SCHEME. This measure, introduced in 1980, provides financial support for a wide range of mar- keting activities performed by importing firms. The activities eligible for support comprise promotion activities (e.g., adver- tising, catalogues and brochures) and product adaptation. Ac-

Table 1. Import Guarantees and Marketing Support Granted to Importers, 1980-1992

Import Guarantees Marketing Support (in million NOK) (in million NOK)

1980 - 0.2 1981 0.3 0.1 1982 1.6 0.1 1983 1.6 0.5 1984 4.6 0.7 1985 2.2 0.6 1986 11.9 0.2 1987 13.2 0.8 1988 4.5 0.8 1989 8.3 1.9 1990 10.0 1.2 1991 8.5 2.7 1992 16.1 1.9

Source: Annual Report. NOPdMPOD, various years

cording to the guidelines, NORIMPOD may cover up to 50% of the costs of marketing activities in an introductory stage of "reasonable duration." The only other import promotion office providing marketing support is the Swedish one.

The annual expenditures under the marketing support scheme in the period 1980-92 are reported in Table 1. Ac- cording to NORIMPOD, nearly all the applications for market- ing support are accepted. However, as can be seen from Table 1, the amounts granted annually are still limited even if they have been increasing since the scheme was introduced. Accord- ing to a survey commissioned by NORIMPOD in 1989, the mar- keting support scheme has not been particularly successful in attracting new importers, because 80% of the companies receiv- ing support in the period 1986-89 already had at least five years' experience in importing from developing countries (Gripsrud and Benito, 1993). The total number of companies that had been granted support in the period was only 32, and only eight of them had annual sales exceeding 10 million NOK In the study it also turned out that a majority (54%) of the companies had marketed products from developing countries prior to receiv- ing support. In some cases this had taken place before the mar- keting support scheme was introduced, whereas in other cases it had happened while it was in existence. The limited number of companies applying for support, and the fact that many of them had been engaged in importing previously without ap- plying, indicate that potential importers may not be sufficiently aware of the marketing support scheme.

Promotion Directed at Ultimate Buyers Recently, NORIMPOD has also started to promote specific prod- uct groups originating in developing countries to the consumers. In the spring of 1991, a campaign for increased consumption of mango was sponsored, whereas a similar campaign for an increased consumption of tuna was launched in 1992. This type of generic marketing is new to the office and typically involves a collaboration with larger importers. In both cases, a product group was selected that had to fulfill two criteria. First, the prod- uct group had to have a relatively low per capita consumption in Norway. Second, imports of the product group had to come primarily from developing countries. NORIMPOD sponsors the production of brochures, posters and recipes, and reimburses the costs of the personnel organizing demonstrations of the selected products in supermarkets.

Summary and Discussion The findings from a number of studies indicate that increasing exports from developing countries may assist in achieving eco- nomic growth in such countries. Export from a developing to a developed country implies that an exchange relationship is established between a seller located in a developing country (exporter) and a buyer located in a developed country (im- porter). An importer will only engage in such transactions if he perceives a market to exist for the relevant products. Many

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barriers to increasing exports from developing countries are subject to multilateral and bilateral trade negotiations. The fo- cus of this article has been on the need for additional measures at the micro level.

The traditional approach has been to support exporters in various ways, by offering assistance to exporters and would- be exporters in developing countries similar to those that typi- cally are available to potential and actual exporters in industri- alized countries. Three types of institutions are involved in such efforts: export promotion offices in developing countries, the International Trade Center and import promotion offices in a number of developed countries. From a marketing perspective such export promotion may be interpreted as a complex ex- change process. Based upon a model of the complex exchange process involved, it has been argued in this article that the con- ventional approach should be supplemented with import pro- motion assistance in developed countries.

The Norwegian agency, NOR/MPOD, is one example of im- port promotion efforts directed at increasing exports from de- veloping countries. A unique feature of NORIMPOD is that it provides a range of services aimed at importers, and also, al- though to a limited extent, at consumers. Currently, only a limited number of companies have applied for, and received, support. The results from an exploratory study among compa- nies who had received support revealed a general lack of knowl- edge about the marketing support scheme, and efforts are needed to market the support scheme better to potential im- porters.

A characteristic of the various schemes operated by NOR/M- POD that restricts their scope is that only products imported directly from a company located in a developing country are eligible for support. Because a wide range of the products that originate in developing countries are channeled through com- panies based in various industrialized countries, the number of products eligible for support is limited. Thus, it may be ar- gued that the marketing support scheme primarily promotes a particular marketing channel for goods produced in devel- oped countries and not exports from such countries in general. Clearly, activities aimed at increasing imports from developing countries may conflict with the interests of companies with es- tablished market positions. The marketing support scheme in particular, may be looked upon by the business community in general as being a preferential treatment of certain import- ing companies, which in turn leads to unfair competition. The cautious approach taken by NOR/MPOD with regard to provi- sion of information about its services should, to some extent at least, be seen in this context. However, in our opinion provid- ing more rather than less information appears to be the appro- priate approach. The transparency of the system may be a cru- cial factor for the credibility and acceptance of the import support schemes in the business community.

The key to a substantial increase in imports from develop- ing countries probably is the ongoing attempts to further liber- alize international trade. Nevertheless, problems such as per- ceived barriers to export and country-of-origin effects must also

be dealt with. Import promotion programs are important, per- haps even necessary, means to reduce such barriers. Although the scant attention given to import promotion may be inter- preted in the light of the political conditions prevailing in many countries, the potential pay-off of redirecting resources from export promotion in developing countries to import promo- tion in developed countries may be substantial. The theoretical framework put forward suggests that a more balanced approach to promoting trade is needed. However, little knowledge exists on how to design and implement import promotion efforts that really contribute to increased exports from developing coun- tries. The trade and marketing effects of import promotion ac- tivities undertaken by NORIMPOD as well as other IPOs should be assessed in future studies. Future research should also in- vestigate the marketing barriers typically perceived by importers of products from developing countries. While many studies have explored barriers to export, scant attention has been given to perceived import barriers. A mapping of such barriers would benefit the design of effective programs to promote imports from developing countries in the future.

The authors thank professor Luis V. Dominguez, Donald Storrie and two anony- mous reviewers for their helpful comments.

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