December 1997 Economic Digest - Importing and Exporting

December 1997 Edition

DRUG RESEARCH

Last year, pharmaceutical companies in Canada pumped $665 million into drug development research. Nearly $400 million of that money funded clinical trials, in which new drugs and therapies are tested on patients prior to their formal approval. There are now twice as many Canadians enrolled in clinical trials as there were seven years ago. Last year clinical trials involving nearly 35,000 patients investigated 140 drugs across Canada. But, increasingly, there are countries where it is more cost-effective to conduct clinical trials. Eastern Europe is now attracting clinical research dollars because of the much cheaper costs of running trials there.

CELL PHONES

Canada's cellular telephone industry continued to record strong growth in 1996. There were 3,420,318 cell phone subscribers in Canada on December 31, 1996, up 32.1 per cent over the 1995 year-end figure of 2,589,780. Cell phone service providers reported annual revenues of $2.84 billion in 1996, an increase of 24.5 per cent compared with 1995 revenues.

PORTUGAL

Trade between Portugal and Canada is undergoing a transformation. In the past two years, sales of Canadian goods and services to Portugal have increased by nearly 300 per cent. In 1996, Canadian exports to Portugal totaled $99 million, while imports from Portugal reached $179 million. A co-operation agreement was signed recently between the Industrial Association of Portugal (AIP) and the Alliance of Manufacturers & Exporters Canada (AMEC). This agreement allows for much closer ties between these two major manufacturing associations and seeks to boost the competitiveness of their respective countries and to promote both exports and investment. Canadians can increasingly see Portugal as a gateway to the major European market. The Portuguese economy has the strongest growth rate of any European country in 1997, with GDP increasing by 2.5 per cent.

GROWTH

Since 1986, the home-computer market in the U.S. has grown from a $3-billion (U.S.) annual industry to more than $16-billion. Growth is fuelled by owners being accustomed to replacing their systems, on average, every 2.5 years. By contrast, people who buy a TV or VCR might not replace it for 11 years. It is suggested that adopting the economics of the personal-computer industry is the only way the consumer electronics industry can survive.

GENETICS

Two U.S. patents were granted recently for a process that puts vaccines directly into vegetables. But even before the patents were approved, the first clinical trials for edible vaccines received approval from the U.S. Food and Drug Administration. Volunteers in Maryland will be fed raw potatoes that have been genetically engineered to trigger an immune reaction to the E. coli bacteria, a major cause of stomach upsets. A group in Mexico is putting the E. coli gene into bananas.

RETAIL

Despite increased consumer spending, a Consumer PulseCheck Survey states that Canadian retailers are losing sales because of high prices, out-of-stock items and slack service. While 32 per cent of consumers head out to a store with a specific purchase in mind, only 11 per cent actually find and buy what they want. Would-be buyers cite such hassles as high price (33 per cent of respondents), not finding the item (26 per cent), item not in stock, (16 per cent) and couldn't get service (7 per cent). A startling 20 per cent of consumers said they could not think of anything they liked about shopping.

RELAXATION

The Llama Therapeutic Group has opened North America's first llama retreat centre in B.C. Burnt-out business people are being invited to spend time without faxes, TVs or pagers. According to the founder, within 20 minutes of feeding, grooming and outfitting a llama for a trek, executive worry lines start to disappear, the tone of their voice changes and their breathing relaxes. Only $1,600 a time.

PROFITS

A new study by Gistics Inc. states that last year, 94 per cent of all CD-ROM publishers in the world failed to make a profit. The consulting firm gives two reasons: customers can't preview the expensive products before buying and the failure rate of CD-ROMs is high; Windows computers, it claims, have a 40 to 50 per cent failure rate when trying to run them.

INCOME

In 1996, spending from abroad on post-secondary education brought $1 billion into Canada in the form of tuition fees and living expenses. At the same time, spending by Canadian residents at universities and colleges abroad amounted to over $600 million. Sales abroad of legal services by law firms in Canada amounted to over $260 million including registration of patents and trademarks. The purchase of legal services from abroad approached $210 million. International management consulting produced some $215 million in revenues for Canadian providers. The estimate includes work funded by CIDA.

SITES

Two more sites are available on Strategis, Industry Canada's Web site, which are designed to give small businesses the tools they need to innovate, grow and create jobs. For growth-oriented firms, there's a page providing tips on how to get risk capital at strategis.ic.gc.ca/growth. Another specializes in steps to competitiveness and may be found at strategis.ic.gc.ca/steps.

LABOUR FORCE

So far this decade, there has been extraordinary growth in the number of Canadians who are self-employed. Between 1989 and 1996, the self-employed accounted for over three-quarters of job growth. The number of people who became their own boss surged 25% during this period, while the number of paid employees increased only 1%. As a result, the self-employed now account for 18% of all workers, up from 14% in 1989 and 12% in 1976. While the likelihood of being self-employed has grown considerably over the last 20 years for both sexes, the rate of growth has been stronger for women. While men represented about 74% of the self-employed in 1976, they now represent about two-thirds.

FACILITIES

In the U.S. national park at Delaware Gap, Pa., Washington has built a two-hole outhouse for $333,000 (U.S.). Although critics have attacked its cost, supporters note the state-of-the-art structure was the work of more than a dozen designers, architects and engineers and it is earthquake-proof.

STANDARDS

Canadian businesses can now check out thousands of Canadian and international standards on the Internet. The Standards Council of Canada has teamed up with the Open Text Corp of Waterloo, Ont., to provide quick on-line information such as manufacturing specifications for companies interested in exporting their products. Canadian businesses can also provide comment and recommendations on new standards. The council's Web site is www.scc.ca.

PROFITABILITY

Among Canada's larger enterprises, the most profitable goods producers in 1996 were firms engaged in the production of chemical fertilizers (excluding potash), and explosives. The median rate of return was 17.3%. In second place in the 1996 rankings were motor vehicle parts and accessories manufacturers (14.7%). The least profitable goods producers were pulp and paper manufacturers (0.9%) and fish and other seafood processors (1.9%). Among financial institutions, the most profitable in 1996 were independent investment dealers (26.5%) and investment dealers that are subsidiaries of banks (15.7%).

FEATHERS

A U.S. federal researcher, pondering new ways to use chicken feathers--a poultry rendering plant can process half a million pounds a week--has suggested using the absorbent material to make disposable diapers. Currently, ground-up chicken feathers are used to grow mushrooms or are fed back to chickens as a protein supplement.

WATER

U.S. companies selling bottled water may legally use the terms "Mountain fresh" and "Glacier pure" even if their product has been nowhere near a mountain or a glacier.

CLEAN-UP

Opportunities exist for Canadian companies in the area of environmental clean-up. The sharp resurgence in Gulf of Mexico oil and gas activity has been accompanied by the challenge of disposing of a large number of less economically viable, older-generation wells. More than 3,000 platforms currently dot the U.S. federal waters in the Gulf, and the looming cost of removing the platforms, plugging and abandoning the wells and cleaning up the ocean floor has been estimated by the U.S. Department of Environment at about $US5 billion -- $US2.9 billion for platform renewal, US$1.4 billion for plugging and abandoning, and $US600 million for site clearance.

SMALL BUSINESS

According to the Business Development Bank of Canada, small businesses now employ half of Canada's private sector workers. They also generate almost 43 per cent of the private sector output and create 90 per cent of the new jobs.

HARDWARE

Canadian hardware manufacturers are highly export-oriented. In recent years, foreign shipments have been equivalent to as much as 73% of factory shipments. At the same time, imports of information technology products are substantially greater than domestic production. Canada incurred a trade deficit of $18.6 billion in these products in 1995. Few countries - not even the U.S. - consistently maintain a trade surplus in information technology products. Moreover, information technology imports reflect investment in cutting edge technologies by Canadian corporations to maintain their competitiveness in international markets.

TEACHING

Though retirements and burnout will open up new teaching jobs after the year 2000, there will be a lot of competition for these jobs according to a Statscan study. Teachers specializing in mathematics, the sciences and certain technical subjects have the best prospects, even in the current tight job market. Assuming a retirement age of 60, about 61 per cent of Canadian elementary and secondary school teachers--or 211,000 out of 347,000 teachers--will retire between now and 2015. There are currently more than 35,000 teachers available for full-time work.

FLOWERS

After the Princess of Wales died, Colombia's flower industry saw a 20 per cent leap in the sales of its blooms to Europe.

INFORMATION

Across North America, long-distance directory assistance is handing out bad information with increasing frequency. The problem, according to the Washington Post, is that as local phone companies begin to compete against long-distance carriers and each other, many are refusing to share updated lists of customers' phone numbers.

MEMORY

Researchers at British Telecom and MIT are working on "intelligent glasses." When confronted by a familiar but nameless face, the spectacles will automatically print the name above the person's head in a way only the wearer can see, or whisper it into an ear.

QUOTES

"Why, sir, there is every possibility that you will soon be able to tax it."--British scientist Michael Faraday (1791-1867) when asked by a politician about the usefulness of electricity.

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November 1997 Economic Digest - Importing and Exporting

November 1997 Edition

INNOVATION

 
Statscan reports that small- and medium-sized manufacturing firms are less likely to introduce new products and processes than large firms. While over 63% of large firms introduced a new product or process between 1989 and 1991, only 40% of small firms did so. In addition, of those firms that did innovate, smaller firms were less likely to introduce world-first changes and were relatively more likely to introduce Canadian-first innovations. Although innovation occurred somewhat less frequently in small firms, there were 10 times the number of small firms. Therefore, small firms produced a much larger number of innovations in total than did large firms.

HOPEFUL

A survey of 1,400 small and medium sized businesses across North America shows they are pretty optimistic about economic prospects in the next year. Half of both Canadian and U.S. businesses said they expect revenue growth, while a third on each side of the border expect to hire more employees. But Canadian companies rely more heavily on markets and suppliers outside their local areas or provincial borders. Twenty-seven per cent of those surveyed do business globally, compared with 19 per cent of their U.S. counterparts. And 47 per cent do business nationally, compared with 39 per cent in the U.S.

HELP

A new initiative, HorizonsPlus, was launched recently by Industry Canada and the Alliance of Manufacturers & Exporters Canada to increase the number of exporters and to help small businesses build sales abroad. HorizonsPlus matches companies seeking new overseas markets with young graduates who are trained and interested in careers in exporting. A Web site, www.the-alliance.org/horizonsplus, is available for those who need information.

LOCATION

One of the latest trends for franchises is co-branding or cutting costs by sharing premises with a compatible business, says the International Franchise Association. Another way to promote growth is to move into non-traditional locations. For example, postal and package service provider Mail Boxes Etc., whose outlets are usually set up inside drug or grocery stores, has moved into hotels, convention centres, high-rise offices and college campuses to meet market demand.

ETHICS

Because it is voluntary, the federal government endorses but won't require its Crown operations to use a new code of international business practices and ethics drafted by a group of Canadian companies and associations with foreign operations. The government sponsored the discussions among business and human rights groups leading up to the code. Among the code's provisions are promises to: Promote human rights where companies have influence; Refrain from paying bribes; Protect worker health and safety; Shun child labour; Involve local communities in company activities and, Protect the environment.

ART

The art auction market continues to recover from the slump of the early 1990s. During the 1995-96 season, worldwide turnover topped $1.7 billion, the highest 12-month total since the peak of more than $4 billion in 1989-90. The U.S. was the busiest market with sales of $761 million followed by Britain with sales of $501 million.

ECONOMIES

Developing countries will double their share of global Gross Domestic Product, says the World Bank in its annual report, to account for nearly a third of global output by 2020. The big five developing countries, China, India, Brazil, Indonesia and Russia, will grab an even larger chunk of exports, rising from 9% in 1992 to 22% in 2020. In East Asia, the Bank forecasts real GDP growth slowing to 7.6% over the next ten years from 9.2% in 1987-96.

INDUSTRIAL CAPACITY

Industries increased their use of capacity to 84.8% in the second quarter of 1997, just half a percentage point below the most recent peak of 85.3% recorded in the fourth quarter of 1994. This increase marks a full year of steadily rising rates. The upsurge in household spending and strong business investment in plant and equipment were the major contributing factors to increased production and the resulting rise in rates of capacity use in the second quarter. In response, industries in the manufacturing and construction sectors stepped up production. The strength in manufacturing is likely to continue, according to the latest Business Conditions Survey.

PENSION FUNDS

The total value of the world's pension assets grew by 58 per cent, from $5.4 trillion to $8.5 trillion, between 1991 and 1996, according to InterSec, a research company. The firm predicts a similar rise, to $13.5 trillion, by 2001. The fastest growing pension funds have been in Latin America. Last year they were worth $113 billion, almost four times as much as in 1991. Predictably, the U.S. has the largest stock of pension assets with $4.4 trillion-worth in 1996, almost two-thirds of it in private funds.

TRANSIT

Despite the emphasis on taking public transit, Canadians are using it less and less. In 1996, each Canadian took an average of about 46 trips on some form of urban transit, the lowest level since 1970 when the average fell to 43 trips per person. In contrast, Canadians were using mass transit at three times that rate at the end of the Second World War. The popularity of urban transportation plunged rapidly between 1950 and 1970 with the boom in automobiles and the growth of suburbs. It rebounded slightly during the 1980s when the energy crisis, the travel needs of persons without access to a car, and environmental awareness encouraged governments to turn more and more to mass transit.

CASH

A lack of cash in Russia has caused some unusual methods of payment. In January, some Siberian workers were paid off in coffins while workers at another Volgograd factory were paid in bras. A movie theatre in Altai, Siberia, allowed customers to pay two eggs for a ticket and when eggs ran short locally the price of entry was empty bottles. On a larger scale, officials say that in the fuel and energy sectors, only 20 per cent of transactions are settled in money. The balance comes, if at all, in barter. Faced with companies protesting a lack of cash to pay taxes, local governments are allowing factories to settle their debts with cans of paint and newly-assembled trucks.

WORTH

The average Canadian's worth advanced $2,100 in 1996, as national net worth rose almost 4% to $2.6 trillion. This was the combined result of an increase in national wealth and a small decline in Canada's net foreign indebtedness: what we owe to non-residents less what they owe to us. Net worth grew at a slightly faster pace than the previous year, reflecting the strength in domestic economic activity and the slowing in debt accumulation.

URBANIZATION

The World Watch Institute says that land use for grain production totalled 0.3 acres a person last year, down from 0.57 in 1950. The spread of roads, buildings and industrial parks eats up some of the most productive remaining land. At least 5 per cent of China's cropland was lost between 1950-1992 due in part to urban expansion and industrialization.

POLAND

Opportunities exist for Canadian environmental companies looking for new clients and potential partners in this dynamic market. Poland is a large environmental market given its high level of municipal and industrial pollution. Last year's spending in this sector exceeded US$1 billion. By the year 2000, Poland plans to spend over US$6 billion in order to meet European Union environmental standards.

SECURITY

New technology that identifies people using the eye is being developed for use with automated teller machines and for other electronic transactions. As a person walks up to an ATM, three standard video cameras zoom in. First they identify the approaching form as a person. From almost a metre away, they take an image of a person's eye and match the iris with an image already digitally encoded and kept in an electronic file. The system works even when the customer is wearing glasses, sunglasses or contact lenses and in many cases where the person is blind. There is no way to copy someone else's iris pattern using a contact lens.

CABLE

The Canadian cable television industry reported revenues of $2.7 billion in 1996, up 5.8 per cent over 1995. Total revenue from basic cable television operations increased by 3.1 per cent to $1.9 billion from $1.85 billion. Revenue from discretionary and other services advanced by 13 per cent to $775 million from $686 million. There were 7.9 million subscribers (direct and indirect) in 1996, 74 per cent of which subscribed to discretionary services compared with 71 per cent in 1995.

HONG KONG

Hong Kong's chief executive pledged to spend $11.4 billion (U.S.) over the next five years improving housing, infrastructure and services in the former British colony, now part of China. Also announced is a plan to build a science park.

SERVICE

A study of 10,000 Canadians by the National Quality Institute, funded by Industry Canada, reports that pharmacies are best and the government worst when it comes to customer service. Pharmacies received a 93 per cent customer service approval rating while the government got 40 per cent. Telephone companies, trust companies and credit unions were ranked as the most improved.

EL NINO

The warming effect of El Nino in the South Pacific could help business and consumers in Canada shave more than nine per cent off their gas bills this winter. In 1982-83 when the last El Nino occurred, gas prices fell 13.75 per cent from a year earlier. El Nino is a mass of warm water the size of Europe which usually remains in the Pacific but trade winds can change the current and the world's weather patterns.

PROGRESS

According to the New Scientist, a new digital video disk that self-destructs after two days could end the trek back to the video store to return videos. A U.S. consortium wants to replace the familiar videotape with its limited-life disks which would cost about $5. Because of movie industry fears about piracy, films would be scrambled and a special code needed to access them.

PEACE

Technical engineers at Chiltern Railways in Britain have developed a train window covered in metallic microfilm that mobile-phone signals cannot penetrate. The aim is to offer commuters "no-phoning" rail cars, similar to "non-smoking" cars.

TECHNOLOGY

After years of planning, a "virtual record shop" will open shortly in London. The promoters claim Cerberus will eventually be able to stock every piece of music ever made. If the plan succeeds, music lovers will no longer need to buy albums. If they have computers, they will simply download songs; if they don't, they will visit computerized kiosks to choose their own compilations, which will be pressed into CDs while they wait.

GAMES

To stop American public servants playing at work, Congress is considering legislation to outlaw games on computers used by federal agencies.

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October 1997 Economic Digest - Importing and Exporting

October 1997 Edition

 
GLOBAL ECONOMY

 
The most recent forecast by the International Monetary Fund (IMF), states that Canada will lead the industrial world in growth both this year and next. The current boom in the global economy is being powered by Canada, the U.S. and Britain. This boom will likely continue into the next decade with projected growth of 4 per cent continuing until at least 2002. But while North American and European economies surge, Asian economies are faltering. On the eve of what has been dubbed the Pacific Century, several of Asia's best economic hopes are mired in stagnation and financial crisis. Only China remains a bright hope among Asian nations.

INDIA

Of India's 100 top companies, 70 are family businesses, and until recently they controlled about 15 per cent of the economy. This changed in 1991 when, in the face of financial crisis, the government opened up the economy to competition and foreign investment. The reforms sparked a consumer boom and surge in private investment. They also exposed just how bloated, inefficient and consumer-hostile many of India's top companies had become. For most of India's independence, socialist governments controlled the private sector with licences that told companies what they could produce, how much and when. This resulted in shortages and high prices for uncompetitive junk, as well as slow economic growth.

AGRICULTURE

Canada's agricultural and agrifood sector has reached a goal in export sales four years ahead of schedule. Agriculture Canada says export sales in 1996 reached $20 billion, a figure the federal government had hoped to see by the year 2000. The $20 billion represents a 50 per cent increase from exports in 1993, the year the target was set by the industry.

CUBES AND CAVES

In office design, open plan offices are called cubes, whereas an enclosed office is referred to as a cave. According to surveys by the International Facility Management Association, the cubist ranks are growing. An estimated 40 million Americans, nearly 60 per cent of the white-collar workforce, now work in cubes. And offices of all kinds are shrinking. Research shows that personal work space has shrunk 25- to 50 per cent over the last decade at 72 big, trend-setting companies studied.

CHINA

To help its attempts to become a member of the World Trade Organisation, China is cutting tariff rates by an average of six percentage points, from 23% to 17%, on nearly 5,000 items.

TUNNELS

Engineers are preparing to build the world's first floating tunnel, a 1.6 kilometre concrete tube moored 25 metres below the surface and 120 metres above the seabed, near Stavanger, Norway. It will contain two traffic lanes and a bicycle path. If the structure is successful, tunnels through the middle of lakes, fjords and estuaries are likely to be built in other countries. Proponents say floating tunnels are cheaper than bridges, or tunnels through the earth, and are more environmentally friendly.

EARNINGS

The number of women who earned more than their male partners increased in 1995, resuming a long-standing upward trend after a decline in 1994. In 1995, 983,000 females earned more than their male partners, up from 916,000 in 1994. Since 1967, this number has increased almost sevenfold, from 143,000.

NEW POWER

Daimler-Benz, maker of Mercedes cars, and Ballard Power Systems, a Canadian company developing fuel-cell technology, have launched a joint venture to develop an alternative to the internal-combustion engine. Together the companies are investing over $300 million to develop vehicles powered by fuel-cell engines. A bus, running on hydrogen and with zero exhaust emissions, is being tested on the streets of Chicago and Vancouver, and a specimen fuel-cell car was unveiled at the Frankfurt Motor Show. Mass marketing of such cars could begin within eight years.

LATIN AMERICA

The majority of Latin American countries have made progress in the fight against inflation during the past two years. Since 1995, only three countries in the region have had a rate of inflation above 25 per cent. The most striking change was in Brazil where, following the introduction of a new currency in 1994, inflation tumbled from 277 per cent to 4.8 per cent in July of this year. Chile's inflation has remained in single digits and has declined from 8.2 per cent in 1995 to 5.6 per cent this year. Argentina's inflation has been the lowest, even experiencing slight deflation.

MILLENNIUM

Australia's Prime Minister has announced that his country will celebrate the new millennium beginning Jan, 1, 2001--a year after the rest of the world, but mathematically correct.

HOUSES

According to an international study conducted by the Washington, D.C.-based National Association of Home Builders, Canadians have the best housing in the world by nearly any measure. The study, which compared Canadian and U.S. houses with those in other industrialized countries, showed that, based on the average number of persons per home, Canadians have the least crowded housing. On top of that, Canadian homes are only slightly smaller, on average, than U.S. houses which are the biggest in the world. The average Canadian home is 122 square metres while the U.S. average is 125 square metres. In the condominium category however, Canada is tops in size. The average apartment\townhome is 102 square metres compared to a U.S. average of 79 square metres.

EUROPE

Taxes and social-security contributions consumed a record 42.4% of the European Union's GDP last year, said the EU's statistical agency, Eurostat. Three Nordic countries imposed the heaviest burdens on their economies, with Sweden taking 55.2%. Ireland, Spain and Britain taxed less than 36%.

SPEED

Teraflops is a computer at the Sandia National Laboratories in New Mexico. It gets its quasi-acronym name because last year it hit a speed of 1.8 trillion calculations a second. It is 10,000 times faster than a Pentium MMX system. Somebody operating a hand-held computer would need about 57,000 years to calculate a problem that Teraflops could calculate in one second.

FRANCHISES

A new franchised business opens somewhere in the U.S. every eight minutes, according to the International Franchise Association. While restaurants such as McDonalds are the most visible examples, there are 65 categories of industry offering franchises. Nearly 600,000 franchised businesses operate in the U.S., generating sales of almost $1.4 trillion each year--close to half of all retail sales. Franchises are more likely to thrive than are independently owned businesses, with 92 per cent surviving after five years compared with 23 per cent of independents, according to the U.S. Commerce Department.

COMPLAINTS

According to a survey of 10,600 by the International Facility Management Association, the biggest complaint people have about the place where they work is that it's too cold. The second biggest complaint? It's too hot. Other complaints in the top five included not enough conference rooms, poor janitorial services and not enough storage space.

SCAMS

The Washington-based National Consumers League is posting Web pages warning Internet users of the top on-line scams. League officials say the most common signs of fraud are: extravagant promises of profit, guarantees of credit regardless of bad credit history, suspiciously low prices, or prizes that require up-front payments. They may be checked out at http://www.fraud.org/ifw.

WHOLESALERS

According to Statscan, the wholesaling industry is in constant transformation. Increased competition has pushed wholesalers to diversify in order to remain competitive. In addition to their main activity of selling to retailers, industrial clients and farmers, wholesalers provide services such as supply management, provision of information on new technologies and bulk breaking. They also sell a certain proportion of their products directly to household consumers. Sales to households by wholesalers are estimated to be about $1 billion a month, approximately 4% of total wholesale sales. Half of the sales made directly to households by wholesalers are coming from building materials (40%) and computers and packaged software (10%).

E-MAIL

Canadian Tire Corp. Ltd. says it is breaking new ground by introducing an electronic flyer that will allow consumers to receive selective promotional information at their individual E-mail address. The electronic flyers will not replace the regular flyers that are dropped off at homes but will allow people to request information on deals in selective categories and avoid having to get material about categories they are not interested in. The company claims this marketing scheme will help them better predict high-demand merchandise and which products to stock in the stores. However, consumers will not be able to purchase products directly on-line.

2000

A U.S. retailer is bringing the world's first lawsuit over the millennium timebomb--a problem in which computers are unable to work with dates after the turn of the century. The Michigan supermarket is taking the supplier of its cash registers to court for the equipment's failure to recognize the year 2000 as an expiry date for credit cards. Whenever a card with the 2000 expiry date is swiped at the supermarket, it brings up an "invalid date" warning, quickly followed by the shutdown of the entire network. The case has been hailed as the beginning of a deluge which will occur over the next few years.

FINANCING

Industry Canada has launched an Internet site that will help small businesses and entrepreneurs find financing. Sources of Financing will provide owners with a broad range of Canadian sources of capital. It is available at http://strategis.ic.gc.ca/sources.

JOB SHARING

About 171,000 individuals, or 8% of all part-time paid workers, shared a job with someone in 1995, according to first-time national data on job sharing. Compared with regular part-time employees, people who shared jobs were more likely to be women, to be college- or university-educated, to hold professional occupations and to have children at home. The 1995 Survey of Work Arrangements (sponsored by Human Resources Development Canada) revealed that women held 72% of part-time jobs. But they occupied an even larger majority of shared jobs (84%). Almost 1 in 10 women working part time shared a job, compared with just 1 in 20 men who worked part time.

EMUS

The market for emus has collapsed in Louisiana reports the Associated Press. Pairs of breeding birds that sold for $50,000 in 1993 now change hands for $100 or less. The headache of unwanted emus is so acute that some people have set their birds free, causing traffic hazards and other problems.

QUALITY

A poll of international travel writers concluded that England and Russia tied for having the worst toilet paper in the world.

Thank you for reading the A & A Economic News Digest. For more information visit our website www.aacb.com or contact A & A Contract Customs Brokers Ltd. at strehler@aacb.com.

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September 1997 Economic Digest - Importing and Exporting

September 1997 Edition

 TEXTILES

The Clinton administration has issued a report which says that, since the NAFTA came into effect in 1994, it has prompted a shift in the growth of textile and apparel trade from Asia to the NAFTA countries. U.S. imports of all textile products from Asia's four biggest suppliers declined in quantity by 13 per cent while equivalent imports from Canada and Mexico more than doubled. For U.S. fabric producers, imports from Mexico are also job-savers since nearly two-thirds of these shipments are made out of U.S.-supplied yarns.

RENOVATIONS

Canadian homeowners spent $11.9 billion repairing and renovating their dwellings in 1996, an amount virtually unchanged from the previous year. However, the average expenditure for this type of work reached its lowest level since 1987, when the data were first collected. On average, homeowners spent approximately $1,600 to improve and maintain their homes. This figure is considerably below the peak of approximately $2,200 that homeowners spent on average in 1989.

MOONLIGHTING

Growth in moonlighting over the past two decades has been much stronger than the increase in employment in general. Between 1976 and 1996, the number of workers holding a second job more than tripled, from 208,000 to 699,000, compared with overall employment growth of 40%. In 1996, 1 in 20 workers, or 5%, held more than one job. Twenty years ago the rate was 1 in 50. On the whole, moonlighting means more work hours. While the average work week for all workers in 1996 was 37.1 hours, the average for moonlighters was 46.2.

MALAYSIA

This country boasts an eight per cent annual economic growth, a strong industrial base, a rising middle class, shopping malls and skyscrapers. Just as it emulated Japan to move beyond rubber and palm oil production into cars and electronic components, its new strategy is to jump into software, high-speed networks and digital entertainment. The centrepiece is a giant project costing $8- to $15 billion (U.S.) of public and private money and named the Multimedia Super Corridor. A 1.6 kilometre by 48 kilometre tract, it will be a multibillion dollar test-bed, wired with the latest technology where Malaysians and foreigners can try out new ideas. Also under construction is a new government centre, with a paperless bureaucracy designed to usher in an era of electronic government.

MINING

This is B.C.'s second biggest resource industry and provides its almost 10,000 employees with wages averaging $73,000 a year. But profits have been steadily eroding over the past 10 years to the point that even though mining generated $3.87 billion in revenues, its net income in 1996 was only $208 million--a 59 per cent decline from 1995. Mining ranks third in terms of economic value to the province, behind forestry and tourism.

TRENDS

In 1992, 32 million Americans, 12 per cent of the population, lived in gated communities, condominiums, elderly only communities and residential country clubs that are privately owned and have their own security guards. Today there are 50 million.

DIET

Per capita meat consumption fell to its lowest level in 20 years in 1996 as Canadians continued a long-term trend of including more low-fat milk, yogurt, cheese, poultry, rice and nuts in their diet. Canadians have shifted away from red meat, whole milk and alcoholic beverages. Last year each Canadian ate less than 90 kilograms of meat - beef, pork and poultry - down 2 kilograms per person from five years ago. While per capita cheese consumption has held more or less steady over the past five years, the 10.7 kg consumed per person in 1996 was 56% higher than two decades ago.

GIFTWARE

Industry Canada estimates that the giftware industry in Canada is worth $600 million and employs 45,000 manufacturers, artists and artisans. Currently, export sales for the industry are up 22 per cent, with most shipments being sent to the United States, Western Europe and Japan.

HONG KONG

This territory is the fourth-largest source of foreign investment in the world. The gross domestic product, with 6.3 million people, comes to more than 20 per cent of China's total GDP based on a population of 1.2 billion and more than 60 per cent of external investment in China comes from Hong Kong.

TRANSFERS

Proximity to family is playing a greater role in an employee's decision to relocate and remains the No. 1 reason for declining a transfer. Seventy-five per cent of employees who rejected transfers last year did so because of a desire to remain near their families. The Atlas Van Lines annual survey of 165 U.S. and Canadian companies found that spousal employment has also become a major consideration for employees considering changing cities for their job, moving ahead of living costs as the No. 2 determinant.

FLOWERS

With total annual sales of more than $1 billion, the Ontario floriculture industry is growing at 4 per cent a year, faster than the Canadian economy.

AIRLINES

Air Canada is winning the battle for airline business between Canada and the U.S. despite competition from some of the largest and most aggressive airlines in the world. Air Canada continues to expand while heavyweights such as American Airlines, United Airlines and Delta are pulling back following the open skies treaty of February 1995. Air Canada is flying 88,000 seats to and from the U.S. every week this summer compared with Canadian Airline's 26,000. American Airlines has 36,000 seats, followed by Northwest and Delta with 30,000 each.

INVESTMENT

Canadian business and government plan to invest a record $110.9 billion in plant and equipment in 1997, an 11% increase from 1996. This is the fourth consecutive gain and the largest annual increase in investment since 1993. The growth is evident in many sectors of the economy, most notably the service producing industries which account for 54% of the increase. This latest survey shows much stronger investment for 1997 with an increase of $6.6 billion from what was originally planned earlier this year. Revised spending intentions are based on a sample survey of 23,000 businesses, governments and institutions which had a 77 per cent response rate.

ASSETS

By the end of 1997, there will be $1.8 trillion in structures and equipment being used to produce goods and services in the economy. This amounts to more than $125,000 of capital resources per person at work. This capital endowment of employees has increased by about 60% since the mid-1970s. The strong increase in assets has been especially notable in machinery and equipment, indicating that the economy has been incorporating the latest technological innovations at a rapid rate. The drive by industries to become more productive and competitive in the global economy lies behind this rapid build-up of assets.

TREASURE

Prospectors have moored a barge in the Ottawa River at the end of a sewer pipe hoping to salvage gold and silver in the mud from the Royal Canadian Mint. They are hoping to scoop one million ounces of gold, which at current prices would be worth around $420 million. Stories about flushed minerals began in the early 1900s. With a waste rate of 2 or 3 per cent, compared with less than one per cent today, a lot of gold went out of the pipes at the mint into about 25 metres of water in the bay.

LAWNS

5.5 million power mowers are sold annually in the U.S. But the hot product this summer has been the push-powered lawn mower. Apparently, fit-conscious, noise-conscious and environmentally conscious people are anxious to get back to basics. The American Lawn Mower Co. sold 250,000 of them last year, up nearly 150 per cent over five years ago. Sales are predicted to hit 300,00 this year and keep climbing at 20 per cent to 30 per cent annually. They are selling faster now than they did during the 1940s and 1950s when there were no alternatives.

SIZE

Two American car makers became the world's biggest companies in 1996 (ranked by sales), displacing the three Japanese trading giants that had topped the list for the previous two years. General Motors tops the Fortune 500 list with sales of $168 billion. Ford came second at $147 billion. Of the world's 15 biggest companies, the only one that was neither Japanese nor American was Royal Dutch Shell, a European oil company.

GREEN

A growing demand in China for organically grown foods will shortly be worth $2.5 billion a year. According to a recent survey, more than 70 per cent of Shanghai residents are dissatisfied with current availability and variety and the city is one of the first areas to produce green food.

FOOTWEAR

Canadian manufacturers produced 4,811,354 pairs of footwear in the second quarter of 1997, an increase of 12.5% from the 4,275,303 pairs produced in the same quarter a year earlier. Year-to-date production totalled 8,716,155 (revised) pairs of footwear, up 4.7% from the 8,323,801 pairs produced during the same period in 1996.

RUBBER

According to Fortune magazine, plantations along the South China Sea are the source of 93 per cent of the world's natural rubber. If the South American leaf blight somehow crossed the Pacific, it could wipe them out. At least a third of the rubber in every tire comes from a tree. Without natural rubber, airplanes could not land safely and the trucking industry would be crippled. Doctors and hospital administrators have also learned that they depend on natural rubber for a host of crucial products.

WEATHER

Newly analyzed data from 5,400 weather stations around the world indicates global warming is happening mostly at night and mostly in winter at high latitudes. Warmer evenings could mean longer growing seasons, between frosts, in Canada and Siberia. At the same time, fewer hard midwinter freezes might allow more soil-dwelling agricultural pests to survive the cold months. No one is yet certain if farmers would come out ahead or not.

GAS

Surging natural gas demand is set to make Asia the biggest global energy user by 2010. Huge projects with a combined price tag of $60 billion (U.S.) are moving ahead. Gas consumption in Asia will more than double in the next 13 years as its share in overall energy use, now only 6 per cent, rises closer to the 30 per cent share that gas holds in U.S. consumption. Japan forecasts that total Asian energy demand will reach 3.3 billion tons of oil equivalent in 2010, 10 per cent more than in North America, today's top-ranking energy consumer.

JAPAN

-Japanese comic books are $1 billion dollar industry that account for a third of the country's publishing output.
-When the Fukui Chamber of Commerce in Japan did a survey to discover what people considered to be a long line-up, the average answer was 274 people.
-Japan's squid fleet is so huge that when it switches on all its lights in the North Pacific at night to draw squid to its nets, it can be seen by orbiting astronauts.

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August 1997 Economic Digest - Importing and Exporting

August 1997 Edition

BRAINS

In 1975, more than a fifth of the 10 million people in the labour force had no high school education. Today, barely 750,000 of Canada's more than 15 million workers have such little education and their numbers are shrinking. Almost as startling is the increase in workers with university degrees or other postsecondary certificates or diplomas. There were only 2 million in 1975; these people now number 7.3 million, nearly half the labour force.

CONNECTED

Canada's small businesses are quickly embracing the Internet. A new study shows that about a quarter of the country's 2.3 million self-employed workers are using the information highway. The survey of 6,761 members of the Canadian Federation of Independent Business found that the proportion of Internet users among these small and medium-sized business in the first quarter of 1997 was almost double the level from a year earlier. The largest concentration is in B.C. where 43 per cent of small and medium-sized businesses are on-line.

BUSINESS PLANS

A new Internet-based planning tool will take entrepreneurs through the step-by-step preparation of a bank-ready business plan. The Interactive Business Planner (www.sb.gov.bc.ca), is the Canada\British Columbia Business Service Centre's newest Web tool and is designed to make number crunching easier. When the financial data is entered, the IBP automatically generates an income statement, cash-flow statements and balance sheet. The planner is linked to other information sources on the Internet.

WORRIES

In a new survey of 725 Canadian small businesses, with annual sales under $10 million, 35 per cent put higher sales at the top of their list of worries. Only four per cent see lack of skilled labour as a problem. A weak economy was mentioned by 19 per cent; taxes by 18 per cent; controlling costs, 16 per cent and finding equity, 13 per cent. The search for equity was more of a concern for female owners than males.

COUPONS

Canadian consumers redeemed three million more coupons last year than in 1995. This growth reverses the trend in the U.S. where coupon use has dropped. Canadian manufacturers distributed directly to consumers 3.3 billion coupons, eight per cent more than in 1995. Shoppers using cents-off coupons and grocery and personal care products produced savings of $100 million in 1996 which does not include those issued by fast-food chains and other retailers. Canadians also benefited from higher coupon values which rose to a record 70 cents each on average from 68 cents a year earlier.

TENDERIZING

A researcher at the U.S. Department of Agriculture has announced that explosives can be used to tenderize meat. If done right, the meat doesn't fall apart or lose its colour. The technique involves vacuum-packing beef, lamb, pork or poultry in a plastic bag and putting it into a 280-gallon tank of water. An explosion is generated using a small quantity of high explosives in the water at a precise distance from the meat resulting in instant tenderness without exposure to chemical additives. The idea was suggested by a retired nuclear-weapons specialist.

DVD

By the end of the year, the music industry expects to produce the final specification for an audio version of the digital versatile disc (DVD) which could become as popular as cassette tapes and compact discs. A video version of the new disc, which looks like a standard compact disc but has much higher capacity, is already available in North America and Asia. Initial sales of DVD video hardware and software have been strong. Record companies hope DVD audio will revitalize the music market as the launch of CD's did in the 1980s. Global retail sales of recorded music were static in 1996 at US$39.8 billion.

DOCUMENTS

While the percentage of documents stored on paper is shrinking, the total number of documents organizations are generating is increasing at a much faster rate. Paper usage is increasing by 15 per cent a year in the U.S. and Canadian figures are probably comparable. It is estimated that around 15 per cent of a company's revenue is devoted to publishing activity. Companies now spend around 10 per cent of their revenue handling paper documents and office workers spend up to 60 per cent of their time preparing, filing, copying and faxing documents.

QUALITY

A survey by Canadian Foreign Affairs and International Trade of more than 5,000 people in 20 countries attempted to gauge what the rest of the world thinks about Canada. The country is still perceived as a source of natural resource products but there is a growing awareness of the country as a producer of high-quality goods and services. A majority of people from Mexico, Brazil, Chile, Italy, Ukraine, Israel and South Africa say that Canadian products and services are better than those from other developed countries.

WASHING MACHINES

Europeans are fanatical about their washing machines which load from the front claiming they wash better and are far superior to American ones which are traditionally loaded from the top. Front loaders only account for two per cent of the U.S. home market. A key reason is price: European models sell for as much as $3,000 against $500 for the average U.S. top-loader. They cost more to build because their doors must be watertight and need more sensitive suspensions to balance their loads spinning horizontally. Now Maytag is about to introduce European-style front loaders which they say clean better, use less water, detergent and energy, and even slash drying time by whirling more water from a wash load. The price should come in around $1,000 and some California utilities will be offering rebates of $250 to buyers to encourage conservation.

MICROWAVES

Microwaves can be used to fix potholes according to scientists at the Oak Ridge Laboratory in Tennessee. They have developed a technique that heats the area around a pothole and uses the surrounding asphalt to fill the gap. The repairs are seamless and smoother to drive over and are expected to create a stronger patch than the traditional method of compacting hot asphalt into the hole. Repairs can also be made year round.

COPYRIGHT

Corporate Canada could soon face millions of dollars in new copyright fees under a plan by Canada's copyright collective. Cancopy has served notice to the legal and banking industries that it wants them to pay a new license fee for routine photocopying. A similar fee is already being paid by educational institutions and some pharmaceutical, steel and media monitoring companies.

STANDARDS

The European Union has reached deals with Canada and the U.S. on mutual recognition of safety standards covering $45 billion (U.S.) a year in trade. Products tested and approved for sale in Europe will be considered ready for sale in Canada and the U.S. without having to go through certification procedures. Canadian and American products will have the same advantages entering the 15-country EU. The agreement is meant to reduce the time and expense of trade and paves the way for the eventual harmonization of North American and EU standards.It is hoped the treaty will come into effect in January 1998.

TECHNOLOGY

It is reported that Canada Post and the U.S. Postal Service will install wireless technology to measure the flow of mail to and from Europe. The hardware, which fits inside an ordinary letter-size envelope, is used to track how long an international letter spends in a particular country and to divide up the $5.5 billion (U.S.) in annual international stamp revenues. Eighteen European countries already use this technology to measure cross-border mail flows.

CYBERTAX

A high-profile group of business leaders has warned that governments must negotiate global treaties to cover electronic commerce or risk seeing their tax revenues vanish into cyberspace. National laws are no longer adequate to govern transactions made in the electronic ether, where it is difficult to determine where buyer and seller reside or even where the sale took place. They expect merchandising on the Internet to grow from about $500 million (U.S.) today to about $5 billion by 2000. Taxing data transfers, the so-called bit tax, has been rejected as it would slow the growth of electronic commerce and would be difficult to apply.

DUTY-FREE

Duty-free was an Irish invention that began in the late 1940s at Shannon Airport in Ireland where transatlantic flights had to stop for fuel. It is now a global industry worth more than $20 billion (U.S.), half of which takes place in Europe. But the European business will be massively reduced if the European Union goes ahead with plans to end duty-free shopping for people travelling among the 15 member states as of July 1, 1999. The thinking behind the EU decision is that there is no role for duty-free in a single European market, where borders are evaporating and where tax rates are supposed to be harmonized

INSURANCE

World insurance premiums have broken through the $2 trillion (U.S.) mark for the first time according to Swiss Reinsurance Co. of Switzerland. In 1995, premium volume was $2.14 trillion, up 3.7 per cent from the previous year. Life insurance counted for $1.24 trillion of the total, reaching record highs in Japan, South Korea and South Africa.

ISRAEL

The Canada-Israel Free Trade Agreement saw bilateral trade grow by 38 per cent in the first quarter of 1997. Canadian exports to Israel rose nearly 40 per cent with four industries leading the way--processed foods, chemical products, machinery and electronic equipment and paper products. Exports from Israel to Canada increased 36 per cent with plastics, precious stones and metals, and machinery and electrical equipment leading the way.

SHIPPING

July 1, 1998 is the implementation date for the International Safety management code. While the U.S. says non-compliant vessels will be barred from its ports, Canada has yet to make a decision. Global shipowners have been apathetic in adopting the code and it is estimated that less than 10 per cent of the global fleet has achieved compliance so far. The International Maritime Organization has said there will be no deferral of the target date for enforcing compliance. Shipping executives do not expect the code to be met but maintain that the world fleet will continue operating.

EAST ASIA

This area represents 25 per cent of global economic output, about the same as North America. But over the next decade it will account for half to two-thirds of world economic growth. Canadian exports to Hong Kong, Taiwan, South Korea and Singapore have dropped over the past year but increased to China, Malaysia, Thailand and Indonesia. The World Bank predicts East Asian GDP growth rates of 7 per cent through to 2005 with imports growing by 11 per cent annually. It is estimated that over the next decade, the Asian members of APEC will have to spend $1.5 trillion on transportation systems, electricity plants, water distribution and telecommunications.

ROYALTIES

The Prudential Insurance Co. of America paid $69 million for an issue of Bowie Bonds, based on the future royalties of rock star David Bowie.

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June 1997 Economic Digest - Importing and Exporting

June 1997 Edition

NEW BUSINESSES

A Statscan study shows that four out of five new businesses in Canada go out of business before they are 10 years old. Those that do survive stress high-quality products, customer focus and solid business fundamentals. New firms provide both promise and disappointment. Job creation is their hallmark. They bring new goods and services to the market, while stimulating existing firms to do the same. Although mere survival beyond a decade is a mark of success, most firms do not survive that long. An even more marked sign of success is growth. A sufficient number of the successful new firms grew large enough to ultimately provide almost as many jobs as the entire group (both those that survived and those that went out of business) did when they first started.

VEHICLES

Performing at a record-setting pace, 155,888 trucks were sold in the first quarter of 1997 - the highest number ever registered in a quarter. In total, Canadians purchased 339,894 vehicles (seasonally adjusted) in the first quarter. This was almost 5% higher than the previous quarter, and the highest first quarter sales result since 1990. The largest contributors to the first quarter advance were the Big Three automakers with sales gains of just under 9%.

ENTREPRENEURS

A recent study by Ohio State University found that entrepreneurs tend to breed entrepreneurs. According to the survey, sons were nearly three times as likely to become self-employed if their fathers owned a company. Thirty-two per cent of those with entrepreneurial fathers started a business, compared with only 12 per cent of sons whose fathers were employees. Similarly, 24 per cent of daughters with entrepreneurial mothers started a company, while 13 per cent whose mothers were not self-employed did so.

MARKETS

Eighty-seven per cent of Canada's top entrepreneurs identified the Asia-Pacific region as a target for their international business activities this year according to Ernst & Young's annual survey of 323 Canadian business owners. The United States is a close second at 84 per cent followed by Western Europe at 49 per cent.

CABLE TELEVISION

A Price Waterhouse study indicates that Canadian cable TV subscribers pay a lot less than their U.S. counterparts in major cities--and get better service. Subscribers in major U.S. cities pay up to 60 per cent more per month and receive less quality family programming. Canadian cable customers have as much, or more choice that cable customers in New York or Los Angeles in every category examined. Subscribers in each Canadian city have access to at least 100 more hours of lifestyle programming per week, with Vancouver receiving 50 per cent more than each U.S. city.

IMAGE

In Japan, the image of a sparkling glacial lake and snow-covered Rocky Mountain peaks beneath a Canadian flag can sell almost any Canadian products, from building products and vitamins to bottled water and travel packages. Research indicates that the image of Canada to the Japanese is one of clean, pure and trusting and that consumers are more confident when they know it's a Canadian product.

IDEAS

* The Chicago-based Product Development and Management Association polled 400 developers at trade shows and found that it took seven ideas to generate a new commercial U.S. product in 1995, down from 11 ideas in 1990. In 1967, it took 58 ideas for one new item. The ratio is shrinking in part, say researchers, because companies do more work on the "fuzzy front-end" of the process, such as identifying final users.

* The Wall Street Journal reports that U.S food companies are starving for new ideas. Launches of new foods fell 20 per cent last year, their sharpest decline in two decades.

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MAY 1997 Economic Digest - Importing and Exporting

MAY 1997 Edition

MERCOSUR

            Canada is exploring the possibility of a free-trade agreement with the South American trading bloc Mercosur--a deal that could put pressure on the U.S. to keep its commitment to expanding trade among the Americas. If Canada were to join Mercosur as an associate member, for example, it would give Canadian exporters preference over U.S. businesses in gaining duty-free access for their products in Brazil, Argentina, Uruguay and Paraguay. In 1996, Canada exported $1.6 billion in products to Mercosur countries and imported $1.35 billion.

COMPUTERS

            A survey of 1,320 senior technology officials by Ernst & Young indicates that nearly eight of 10 companies in North America surveyed have lost valuable information in the past two years to computer viruses, hackers, bitter employees, spies or disasters. Most of the losses--63 per cent-- were the result of viruses, but nearly one-third were caused by the malicious acts of insiders. Of the 30 per cent of companies that described their losses, 14 per cent said they lost between $250,000 and $1-million, and 2 per cent said they had lost more than $1-million.

TENDERING

            After studying Ottawa's contracting system for two years, a Commons committee concluded that federal departments bypass the tendering system far too often in giving contracts for goods and services to their own lists of suppliers. Ottawa spent $8.6 billion on contracts in 1994-95, of which $3.1 billion was awarded without tender. MPs also rebuked the Treasury Board for not enforcing its policies, directives and guidelines governing contracts handed out by the departments.

1-900

            According to Strategic Telemedia of New York, psychic hotlines are the anchor of the 1-900 business. It is estimated they take in $300 million a year, one third of the total 1-900 market. The average psychic phone call brings in $40.

EDC

            Export Development Corporation (EDC) supported a record $22 billion of Canadian exports in 1996, serving almost 3,000 customers and increasing business volume by 28 per cent. Over 18,000 other firms benefitted indirectly from EDC activities, when they acted as suppliers to EDC‑financed transactions. In 1996, the proportion of small and medium‑sized exporters assisted by the Corporation rose 23 per cent over the previous year, accounting for over 85 per cent of its customer base. Also, in 1996, the volume of exports by EDC's smaller customers rose 36 per cent to $3.8 billion, while nearly 140 of EDC's smallest customers expanded their export sales to more than $1 million. Responding to strong demand for exports to higher‑risk markets, EDC committed an additional $1.5 billion in financing for these markets in 1996.

FAST FOOD

            Contrary to popular belief, price isn't the main impetus for U.S. consumers who dine on fast food. A survey of 1,032 consumers by Advo Inc of Connecticut found that a convenient location motivates fast-food fans the most. Fast service and a hankering for a specific food rank second and third in importance. Price, in fact, scores seventh on a list of 10 reasons for choosing one restaurant over another. Other factors include easy access, good value and the influence of dining companions. "Healthy food" ranked last on the list.

PATTERNS

            American spending patterns are changing and they are plowing more of their income into goods or services that they think will help them stay healthy, on the go and in the know: mountain bikes, educational toys, museum memberships, chiropractic sessions, computers and home-entertainment centres. Among the big fluctuations: Commerce Department data show that while total U.S. spending rose 15 per cent to $4.69 trillion over the past seven years, spending on new autos declined 28 per cent to $74 billion. By contrast, home computers are consuming about 12 times the portion of the spending pie they did seven years ago. Americans spent over $22 billion in casinos in 1996, more than twice what they gambled seven years ago and spending on alternative medicine has surged 69 per cent since 1989.

SIGNATURE EXHAUST

            This is the sound a car makes when it is running. The auto industry hires musicians and focus groups surveys to tune its engines. The Mazda Miata is engineered to mimic the sound of vintage British MGs and Triumphs.

CHINA

            China announced a second round of tariff cuts at the recent APEC meeting in the Philippines. It will further reduce import duties 15% to 23% by the year 2000. This follows a reduction of 12.9% a few months ago. European critics claim this is just a ploy to improve China's entry into the World Trade Organization and that the tariff cuts mainly fall in sectors of little interest to most Western exporters, while the tariffs on other products like vehicles remain prohibitively high.

POLICE

            In 1996, there were 54,311 police officers in Canada ‑ a 1.3% drop from 1995. The number of police per 100,000 population (181) decreased for the fifth consecutive year in 1996, to its lowest level in over 25 years. Police strength increased steadily during the 1960s and early 1970s, peaking in 1975. Between 1975 and 1991, police strength remained relatively stable. Manitoba had the most officers per 100,000 population (194) in 1996, followed by Quebec (187) and Saskatchewan (187). Newfoundland (146) and Prince Edward Island (149) had the fewest. The proportion of female officers has been increasing steadily since 1974, with females now accounting for 1 in 10 officers.

DWELLINGS

            The number of occupied private dwellings in Canada continues to grow at a faster rate than the country's population. While the population rose 5.7% over the five‑year census period, the number of occupied private dwellings increased 8.1%. The 1996 Census counted 10,899,427 dwellings, compared to 10,079,442 five years ago. The number of occupied private dwellings in British Columbia rose 14.6% to 1,433,533, the biggest percentage increase among provinces.

GUATEMALA

            With economic reforms and a peaceful end to its 34‑year civil war, Guatemala offers new trade and investment opportunities for Canadian firms. Some of these opportunities stem from the country's ambitious peace‑building effort. The (estimated) $2‑billion program will include construction of physical and social infrastructure and comprehensive institutional and legal reform. Other opportunities flow from deregulation, planned for 1997, of energy and telecommunications services, and from anticipated tenders for proposals to administer the state‑owned railway, airport and ports as private concessions. In addition, Guatemala has announced import tariff reductions on a range of products from primary metals, through intermediate and finished products. The duty on imports of primary metals, for example, was slashed from 5 per cent to 1 per cent effective January 1997.

RETIRING

            According to the ScotiaMcLeod Investment Executive newsletter, on average, men are retiring at 61 and women at 58. Based on current life expectancies, this means that their investments must stretch 17 non-working years for men and 23 years for women.

POPULATION DISTRIBUTION

            The 1996 Census confirmed a trend seen for a number of years showing the distribution of Canada's population shifting from east to west. In 1951, 15% of Canada's population lived in Alberta and British Columbia. By 1996, that had increased to 22%. Similarly, Ontario's share of the population has increased from 33% in 1951 to 37% in 1996.

SERVICE

            Traffic jams in Bangkok are so bad that cab drivers and traffic police are being trained to help women deliver their babies. Women trying to get to hospitals give birth to an estimated 350 babies each year in taxis.

FOREIGN CONTROL

            In 1995, the foreign controlled share of operating revenue in Canada rose 1.3 percentage points to 29.8%. This near‑record rise was caused by a combination of strong revenue growth in the foreign‑controlled sector, weakness in the domestically controlled sector and foreign takeovers. Revenue growth for foreign controlled firms was three times that of Canadian‑controlled firms. This was mainly due to weak revenue growth in small and medium Canadian firms. The pattern of lower growth in small Canadian firms has persisted through the 1990s. Small Canadian companies operate predominantly in the domestic market, which has grown relatively slowly since 1991.

BREATHING SPACE

            After two spectacular years, growth in world trade slowed down in 1996 to register a still‑impressive 4% expansion in volume terms. In contrast, world GDP growth increased  slightly. Japan's exports fell last year; in 1990‑96, Japan saw its imports expand six times faster in volume terms than exports.

DUBAI

            In the Gulf, as well as the Near East, a retail revolution has led to the development of some of the world's largest and most sophisticated shopping malls. Disposable incomes, free from taxation, have lured retail developers into multi‑billion‑dollar investments. Dubai is a regional hub supplying a West Asian market of some 2 billion consumers. Imports into Dubai, which acts as a re‑export centre for the Gulf, North Africa and the Commonwealth of Independent States (CIS) have recorded a year‑over‑year growth of nearly 5 per cent over the past two years, with textile imports among the top 10 trading commodities. Textiles are currently Dubai's second‑largest re‑export category, with a value of almost US$1 billion annually. In the GCC as a whole, the re‑export business has risen from 1982 by some 160 per cent.

NATIONAL WEALTH

            In 1996, national wealth rose roughly 3% to reach $2.9 trillion, in line with the rise in domestic expenditures. The gain was the result of acquisitions and revaluations of tangible assets like automobiles, houses, land, household appliances, trucks, and business machinery and equipment. Individuals accounted for just over 49% of national wealth at the end of 1996, up slightly from 1995. National wealth grew 4.0% in the personal sector, compared with 2.5% in both the corporate and government sectors in 1996.

RETAIL

            Annual department store sales rose for the third consecutive year. This increase came entirely from discount stores. With total sales of $8.5 billion in 1996, discount store sales rose 8.6% from 1995. Their sales have increased every year since 1992. Discount department stores recorded a year‑over‑year increase in every month of 1996. On the other hand, consumers spent $6.56 billion at major department stores in 1996, 0.4% less than in 1995. This was the fourth annual decline in as many years.

PLANTS

            On average, an important new drug has been produced for every 125 plant species studied according to the Herb Research Foundation. The success rate for chemical compounds is one in 10,000.

DETERRENTS

            British farmers have found a novel way to deter hungry foxes: lambs that glow in the dark. Researchers have discovered that coating the lambs with horrible-tasting phosphorescent paint discourages predators.