December 1999 Edition
BUYOUTS
Corporate America spent a staggering $24 billion (U.S.) to complete 181 mergers and acquisitions of Canadian companies during the first nine months of 1999. This is up dramatically from the same period last year when U.S.-based businesses spent $12 billion buying Canadian companies in 138 transactions. The numbers represent a reversal of a three year trend. Historically, Canadian companies have been the net buyers in cross border M&A's. Overall, foreign buyers spent $28 billion on 227 deals involving Canadian companies by the end of September.
OPEN SKIES
There has been a two-thirds increase in the number of flights between Canada and the U.S. over the past five years. This year, the number of scheduled commercial flights will be 193,427 from the U.S. to Canada, more than the total for Asia and Europe combined. Air Canada has tripled its U.S. destinations to 45 and across the U.S., 24 cities have begun direct flights to Canada. As a result, Canada now equals Britain as the favoured destination for Americans. Last year, about 8.4 million Americans boarded flights for each country.
POWER
Passenger cars, according to U.S. figures, average 5.05 horsepower per 100 pounds, up from 3.68 in 1978. At the same time, their average weight has fallen to 3,075 pounds from 3,349 pounds.
NEWFOUNDLAND
After lagging behind the national average for several years, Newfoundland's economy led the provinces in 1998 as strength in the new oil sector propelled growth to 6.2%. Oil has flowed from the Hibernia offshore platform since late 1997, and crude oil accounted for the bulk of Newfoundland's stellar export growth in the platform's first full year of operation. Corporate profits took off, rising more than 30% on top of large gains in 1997.
PUMPS
Get ready for commercials while pumping gas. A Kitchener, Ontario, company is testing an advertising device that sits on top of a pump and delivers commercials with full-motion video and audio to captive viewers. Soon, gas stations will even be able to tailor their pitches to specific types of vehicles, ads for diapers or amusement parks to drivers of minivans for instance. Vehicles will be identified by a camera high above the pumps.
CREDIT CARDS
The first multi-use credit card, a Diners Card, was issued in 1950. Only five hundred cards were in circulation, and they were accepted in twenty-seven locations. Forty years later, 492 million cards had been issued, and 247 territories accepted credit cards.
eCOMMERCE
An Internet survey conducted by consumer protection agencies in 14 countries has found most eCommerce sites fail to provide basic consumer information. The survey covered 700 eCommerce sites, examining them against 10 key consumer protection principles. Most sites failed to provide consumers adequate information on subjects such as the security of on-line payments systems and how they handle consumers' personal details. Only 44 per cent of sites disclosed information on the security of on-line payments, while 25 per cent disclosed their privacy policy. Only 10 per cent of sites examined carried a statement of laws applicable to transactions and only one in five sites had information about lodging a complaint.
MAGAZINES
In the last 14 years, U.S. magazines have more than doubled in number from 2,500 titles in 1985 to nearly 6,000 today. Currently, 1,000 U.S. magazines come on the market every year and about 950 magazines fail.
DUST
A new breed of dust-sized computers is being developed in the U.S. So called "smart dust" will pack sensors, communicators and computing power into silicon "motes" light enough to float on air. They could be used to observe weather patterns, monitor battlefield conditions or even spy. Currently, the motes are about the size of Aspirins but researchers hope to reduce them to the size of grains of sand. A tiny onboard computer will help store the motes' readings and sort out what data is worth reporting.
THE FUTURE
Genetic engineers want to craft a Christmas tree that would grow its own lights, an invention that would spell the end to the seasonal frustrations of fiddling with faulty bulbs and cables. The plan, put forward by students at the University of Hertfordshire in England, would be to take a Douglas fir tree and add two genes, from fluorescent jellyfish and fireflies, that would make it grow luminous needles.
PIRACY
Global music executives have singled out Hong Kong as the centre of a $4.5 billion (U.S.) piracy business and have pressed demands for shutting down illicit manufacturers. Hong Kong has 84 licensed compact disk factories that can make two billion disks a year, while legitimate local demand is estimated at 300 million CDs. Since mid-1998, about 20 million CDs were seized en route from Hong Kong and South East Asia to Latin America. Most were destined for Brazil, the world's sixth largest music market.
RUBBISH
NCR Corp. has added a new product to its kitchen range--a "smart" rubbish bin. It recognizes the type of waste as it hovers above the bin, reads bar codes and swallows junk into one of its four compartments where bottles, paper and food waste are tucked away separately--making it easy to recycle. The bin also records consumer habits printing regular shopping lists at the touch of a button, showing what groceries the house is running out of.
ORGANIC
Organic foods are now a $4 billion business in the United States, growing at roughly a 20 per cent rate, while food sales in general are crawling along at three per cent.
WORLD TRADE
The Director General of the World Trade Organization has issued an Overview of Developments in the International Trading Environment in which he pleads for special attention to the needs of the less-developed countries. He notes that it should be a matter of enormous concern that together, the 48 least-developed countries hold a share of only one-half of an one percent of world trade.
FRUIT
The international market in fresh fruits has moved on to the Internet with the launch of FruitXchange, a website where produce can be traded electronically. Fruit is the latest commodity to jump on to the e-Commerce bandwagon. Already, traders can buy chemicals, metals, coffee, sugar and livestock in cyberspace.
ONLINE
A recent study by eMarketer's indicates that the number of U.S. adults online will increase 26%, from 58 million in 1999 to 88 million in 2002. This number is outweighed by the growth rate of the teen segment, which will grow 38%, to 11.1 million during the same period. The report also stated that 30% of the U.S. population will be online by the end of this year. The study also found that:
-the median income for online households is 57 percent higher than the average U.S. household.
-teenagers spend 27 percent more time online per week than the average user and 87 percent of college students are online.
-seniors will be spending $16.7 billion online by 2002.
CHILE
Canada and Chile have signed an agreement to speed up the elimination of tariffs related to the Canada-Chile Free Trade Agreement. As part of this agreement, scheduled to come into force on January 1, 2000, trade in a number of products will become duty free between two and seven years earlier than planned. The value in future bilateral trade in these goods is estimated to be $25 million annually. Two-way trade between the two countries was $683 million in 1998.
AGRICULTURE
All 34 countries of the Americas will form a common front against agricultural subsidies, especially in Europe. To win the support of all the countries, the larger agricultural exporters promised to give the small ones more leeway and more help in their role in creating a free-trade agreement for all of North, South and Central America. According to the U.S., eighty-five per cent of the export subsidies that are distorting trade in agriculture are captured in the common agricultural policy of Europe.
INVESTING
A Yucca plant in Stockholm has become the most unusual investor on the stock exchange. A Swedish artist has attached electrodes to the plant's leaves that link their movements to a computer program tracking the 16 most active stocks. When the Yucca's stock recommendations perform better than the general index, it is given water and light. If the plant fails to deliver profits, it stays dry and in the dark
COURIERS
Couriers and messenger services of all kinds are big business in Canada. In 1997, 11,417 couriers and messengers services generated total revenue of just over $3.8 billion, according to Statistics Canada. Ontario is home to 40 per cent of courier establishments, generating just over $1.9 billion. Local messengers claim 14 per cent of delivery revenue and 59 per cent use surface transport.
REPAIRS
* Fifty years ago there were 75,000 shoe-repair shops in Canada. Now there are about 10,000 and the number is declining.
* Because so few Americans make or mend clothes any more, the U.S Bureau of Statistics in 1998 moved sewing machines from the "apparel and upkeep" category of consumer spending to "recreation."
STARTUPS
Based on surveys with 10,000 people, one in 12 Americans is trying to found a new business. In contrast, just one in 30 Britons, one in 45 Germans and one in 67 Finns want to be entrepreneurs.
MEASURING
The U.S. National Institute of Standards and Technology (NIST) and Japan's Agency of Industrial Science and Technology have agreed to undertake joint efforts to demonstrate the equivalence of measurement capabilities in both organizations. In 1998, the value of merchandise traded between the United States and Japan totalled $180 billion. Regulatory and voluntary standards unique to one country or the other may compel exporters to submit their products for additional testing so that they can demonstrate compliance with the requirements of the importing nation adding to the cost of imported goods.
TRENDS
The Associated Press reports that a major soft-drink company is studying wireless technology that could allow bottlers to raise or lower prices by remote control at certain times; during hot weather for instance. Lower prices during periods of slower sales would presumably bring in more business. The company is testing a machine that can automatically raise prices for its drinks during hot weather. A company spokesman said that the desire for a cold drink increases during the summer heat, so it is fair that it should be more expensive. The machine will simply make the process automatic.
TRIVIA
Golf was banned in England in 1457 because it was considered a distraction from the serious pursuit of archery.
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.
Past issues of the A&A Economic News Digest can be found at http://www.aacb.com/publications/ed/index.asp
Corporate America spent a staggering $24 billion (U.S.) to complete 181 mergers and acquisitions of Canadian companies during the first nine months of 1999. This is up dramatically from the same period last year when U.S.-based businesses spent $12 billion buying Canadian companies in 138 transactions. The numbers represent a reversal of a three year trend. Historically, Canadian companies have been the net buyers in cross border M&A's. Overall, foreign buyers spent $28 billion on 227 deals involving Canadian companies by the end of September.
OPEN SKIES
There has been a two-thirds increase in the number of flights between Canada and the U.S. over the past five years. This year, the number of scheduled commercial flights will be 193,427 from the U.S. to Canada, more than the total for Asia and Europe combined. Air Canada has tripled its U.S. destinations to 45 and across the U.S., 24 cities have begun direct flights to Canada. As a result, Canada now equals Britain as the favoured destination for Americans. Last year, about 8.4 million Americans boarded flights for each country.
POWER
Passenger cars, according to U.S. figures, average 5.05 horsepower per 100 pounds, up from 3.68 in 1978. At the same time, their average weight has fallen to 3,075 pounds from 3,349 pounds.
NEWFOUNDLAND
After lagging behind the national average for several years, Newfoundland's economy led the provinces in 1998 as strength in the new oil sector propelled growth to 6.2%. Oil has flowed from the Hibernia offshore platform since late 1997, and crude oil accounted for the bulk of Newfoundland's stellar export growth in the platform's first full year of operation. Corporate profits took off, rising more than 30% on top of large gains in 1997.
PUMPS
Get ready for commercials while pumping gas. A Kitchener, Ontario, company is testing an advertising device that sits on top of a pump and delivers commercials with full-motion video and audio to captive viewers. Soon, gas stations will even be able to tailor their pitches to specific types of vehicles, ads for diapers or amusement parks to drivers of minivans for instance. Vehicles will be identified by a camera high above the pumps.
CREDIT CARDS
The first multi-use credit card, a Diners Card, was issued in 1950. Only five hundred cards were in circulation, and they were accepted in twenty-seven locations. Forty years later, 492 million cards had been issued, and 247 territories accepted credit cards.
eCOMMERCE
An Internet survey conducted by consumer protection agencies in 14 countries has found most eCommerce sites fail to provide basic consumer information. The survey covered 700 eCommerce sites, examining them against 10 key consumer protection principles. Most sites failed to provide consumers adequate information on subjects such as the security of on-line payments systems and how they handle consumers' personal details. Only 44 per cent of sites disclosed information on the security of on-line payments, while 25 per cent disclosed their privacy policy. Only 10 per cent of sites examined carried a statement of laws applicable to transactions and only one in five sites had information about lodging a complaint.
MAGAZINES
In the last 14 years, U.S. magazines have more than doubled in number from 2,500 titles in 1985 to nearly 6,000 today. Currently, 1,000 U.S. magazines come on the market every year and about 950 magazines fail.
DUST
A new breed of dust-sized computers is being developed in the U.S. So called "smart dust" will pack sensors, communicators and computing power into silicon "motes" light enough to float on air. They could be used to observe weather patterns, monitor battlefield conditions or even spy. Currently, the motes are about the size of Aspirins but researchers hope to reduce them to the size of grains of sand. A tiny onboard computer will help store the motes' readings and sort out what data is worth reporting.
THE FUTURE
Genetic engineers want to craft a Christmas tree that would grow its own lights, an invention that would spell the end to the seasonal frustrations of fiddling with faulty bulbs and cables. The plan, put forward by students at the University of Hertfordshire in England, would be to take a Douglas fir tree and add two genes, from fluorescent jellyfish and fireflies, that would make it grow luminous needles.
PIRACY
Global music executives have singled out Hong Kong as the centre of a $4.5 billion (U.S.) piracy business and have pressed demands for shutting down illicit manufacturers. Hong Kong has 84 licensed compact disk factories that can make two billion disks a year, while legitimate local demand is estimated at 300 million CDs. Since mid-1998, about 20 million CDs were seized en route from Hong Kong and South East Asia to Latin America. Most were destined for Brazil, the world's sixth largest music market.
RUBBISH
NCR Corp. has added a new product to its kitchen range--a "smart" rubbish bin. It recognizes the type of waste as it hovers above the bin, reads bar codes and swallows junk into one of its four compartments where bottles, paper and food waste are tucked away separately--making it easy to recycle. The bin also records consumer habits printing regular shopping lists at the touch of a button, showing what groceries the house is running out of.
ORGANIC
Organic foods are now a $4 billion business in the United States, growing at roughly a 20 per cent rate, while food sales in general are crawling along at three per cent.
WORLD TRADE
The Director General of the World Trade Organization has issued an Overview of Developments in the International Trading Environment in which he pleads for special attention to the needs of the less-developed countries. He notes that it should be a matter of enormous concern that together, the 48 least-developed countries hold a share of only one-half of an one percent of world trade.
FRUIT
The international market in fresh fruits has moved on to the Internet with the launch of FruitXchange, a website where produce can be traded electronically. Fruit is the latest commodity to jump on to the e-Commerce bandwagon. Already, traders can buy chemicals, metals, coffee, sugar and livestock in cyberspace.
ONLINE
A recent study by eMarketer's indicates that the number of U.S. adults online will increase 26%, from 58 million in 1999 to 88 million in 2002. This number is outweighed by the growth rate of the teen segment, which will grow 38%, to 11.1 million during the same period. The report also stated that 30% of the U.S. population will be online by the end of this year. The study also found that:
-the median income for online households is 57 percent higher than the average U.S. household.
-teenagers spend 27 percent more time online per week than the average user and 87 percent of college students are online.
-seniors will be spending $16.7 billion online by 2002.
CHILE
Canada and Chile have signed an agreement to speed up the elimination of tariffs related to the Canada-Chile Free Trade Agreement. As part of this agreement, scheduled to come into force on January 1, 2000, trade in a number of products will become duty free between two and seven years earlier than planned. The value in future bilateral trade in these goods is estimated to be $25 million annually. Two-way trade between the two countries was $683 million in 1998.
AGRICULTURE
All 34 countries of the Americas will form a common front against agricultural subsidies, especially in Europe. To win the support of all the countries, the larger agricultural exporters promised to give the small ones more leeway and more help in their role in creating a free-trade agreement for all of North, South and Central America. According to the U.S., eighty-five per cent of the export subsidies that are distorting trade in agriculture are captured in the common agricultural policy of Europe.
INVESTING
A Yucca plant in Stockholm has become the most unusual investor on the stock exchange. A Swedish artist has attached electrodes to the plant's leaves that link their movements to a computer program tracking the 16 most active stocks. When the Yucca's stock recommendations perform better than the general index, it is given water and light. If the plant fails to deliver profits, it stays dry and in the dark
COURIERS
Couriers and messenger services of all kinds are big business in Canada. In 1997, 11,417 couriers and messengers services generated total revenue of just over $3.8 billion, according to Statistics Canada. Ontario is home to 40 per cent of courier establishments, generating just over $1.9 billion. Local messengers claim 14 per cent of delivery revenue and 59 per cent use surface transport.
REPAIRS
* Fifty years ago there were 75,000 shoe-repair shops in Canada. Now there are about 10,000 and the number is declining.
* Because so few Americans make or mend clothes any more, the U.S Bureau of Statistics in 1998 moved sewing machines from the "apparel and upkeep" category of consumer spending to "recreation."
STARTUPS
Based on surveys with 10,000 people, one in 12 Americans is trying to found a new business. In contrast, just one in 30 Britons, one in 45 Germans and one in 67 Finns want to be entrepreneurs.
MEASURING
The U.S. National Institute of Standards and Technology (NIST) and Japan's Agency of Industrial Science and Technology have agreed to undertake joint efforts to demonstrate the equivalence of measurement capabilities in both organizations. In 1998, the value of merchandise traded between the United States and Japan totalled $180 billion. Regulatory and voluntary standards unique to one country or the other may compel exporters to submit their products for additional testing so that they can demonstrate compliance with the requirements of the importing nation adding to the cost of imported goods.
TRENDS
The Associated Press reports that a major soft-drink company is studying wireless technology that could allow bottlers to raise or lower prices by remote control at certain times; during hot weather for instance. Lower prices during periods of slower sales would presumably bring in more business. The company is testing a machine that can automatically raise prices for its drinks during hot weather. A company spokesman said that the desire for a cold drink increases during the summer heat, so it is fair that it should be more expensive. The machine will simply make the process automatic.
TRIVIA
Golf was banned in England in 1457 because it was considered a distraction from the serious pursuit of archery.
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.
Past issues of the A&A Economic News Digest can be found at http://www.aacb.com/publications/ed/index.asp
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