Measures the ability of firms to sell abroad and to compete with imports. It is determined by a number of factors, including price, quality, delivery and after-sales service. Such competitiveness will often be affected by the level of the foreign exchange rate, though successful exporting countries can succeed despite high and rising exchange rates. This shows that the price of goods is often not the main determinant of competitiveness. Germany and Japan, for instance, have thrived through well-designed, high-quality products such as BMWs and Sony Playstations, for which consumers are willing to pay a price premium.