(2)

The next morning,Mr.Wu refuses,in a polite way,to take up Mr.DuPont’s proposal that we apply to the National Import and Export Bank,Paris,for a long-term loan.We insist on “payment by installments”.Then,DuPont says that in that case some kind of guarantee given by the Bank of China will be necessary and presents his suggestion.It is accepted by Mr.Wu.

W:Hello,Mr.DuPont,we meet again.Let’s come straight to the point.Do you agree?

D:Certainly.That’s the way we should work.What can I expect from you,Mr.Wu,as to the proposal I gave you yesterday?

W:You proposed that we apply to the National Import and Export Bank,Paris,for a long-term loan.But you see,in that case,it would involve another party—the banker—in the tube mill project,which not only increases the cost of the project,but also results in a lot of unnecessary work,because both parties would have to deal through the bank.Don’t you think it would be rather more complicated than “payment by installments” which only involves us two parties? Besides,as I said yesterday,your company would have no problem at all in financing a project like our tube mill.

D:You may say that.But as exporters of a complete plant,we would like to have our investments returned as early and safely as possible.

W:I can understand that.But you may rest assured that the payment is guaranteed.

D:I see.Well,your country enjoys an excellent reputation the world over,and your corporation always faithfully implements all contract stipulations with both buyers and sellers abroad.Had the sums involved in the present transaction not been so large,I wouldn’t have come here.So let us try to come to an agreement one way or another and settle the payment problem.

W:All right.Then let me hear your proposition about the terms of payment?

D:All right,Mr.Wu.You see,the total value of the machines amounts to 2,000,000 euros and the machines will be shipped to China in five different batches within five years.

W:This is surely an advantageous investment on your part.

D:Mind you,investors want a quick return on their money.Your payment will be spread over five installments,which is really too long a period for us to finance.

W:What’s your proposal then?

D:To help us make this transaction possible,I suggest issuing a time draft against you for 400,000 euros covering the value of the first partial shipment,the maturity date of this time draft will be 22nd September,2021.You should show your acceptance of this draft by signing on the back and it should be countersigned by the Bank of China,Beijing,certifying that your signature is true and valid.This time draft represents the first installment and should be given to us upon the signing of the contract.With this time draft accepted by you in our possession,we’ll be in a position to arrange for a loan from our state bank,the National Import and Export Bank,Paris.

W:All right.This is quite acceptable to us.It is,of course,understood that we’ll honor our draft when it comes due only if all contract stipulations have been duly implemented by you.

D:Certainly,we’ll fulfill all the contract stipulations.You may rest assured of our full cooperation and reliable service.

W:Very good.As we have complete confidence in you we shall count on you to execute the order to our entire satisfaction.

D:I consider the terms of payment as settled now.The time draft will be sent to you for your acceptance within a couple of days.

W:That’s for the first installment.

D:Yes,and with regard to the remaining four installments,we confirm that when the first lot of machines are completed by us,we’ll notify you of the date of shipment well in advance.In the meantime we’ll send you another time draft covering the value of the next shipment,i.e.the second shipment,for your acceptance.This same method applies to all the other three shipments.

W:Right.Another thing is that the respective dates of shipments and details of installments are to be explicitly mentioned in the contract.These will be binding on both of us.However,to enable us to make necessary arrangements well in advance,please email us at least one month prior to your shipment for each lot.

D:We’ll do that.

W:As we mentioned during our last discussion,we’ll produce a Letter of Guarantee issued by our bank,the Bank of China,Beijing,guaranteeing our payment of the installments when the accepted time drafts become due,on the condition that the quality and specifications of the machines to be delivered by you are strictly in conformity with contract stipulations.

D:On our part,I presume it’s the same thing we have to do.

W:Yes,in the meantime you should produce a similar Letter of Guarantee signed by two reliable banks jointly and severally guaranteeing your due execution of contract stipulations and guaranteeing that you would reimburse us from the installments paid,should you fail to deliver the machines according to the contract.These specimen letters of guarantee will serve as an annex to the contract.

D:I’ve already made arrangement with our bankers about the letter of guarantee and we can produce it at any time.So please get your contract prepared and I’ll come and sign it when it is ready.

W:That’s very good.Now everything is settled and we expect to have the contract ready for signature within a day or so.Meanwhile,you may send in your time draft covering the first installment for our acceptance.Mr.DuPont,let’s make it,say,10 o’clock the day after tomorrow.Will that be convenient for you?

D:Quite.

Q:Now I’m glad we have at long last settled the terms of payment to our mutual satisfaction.I hope this transaction will pave the way for further business relations between us two countries.

D:So do I.Thank you very much for your valuable cooperation,Mr.Wu.I’ll see you again the day after tomorrow at 10 sharp.Good-bye,Mr.Wu,for now.

W:Good-bye,Mr.DuPont.Thank you for coming to Beijing.