July 2003 Edition
BEER
Heineken, the first foreign beer drunk by Americans after the end of Prohibition, is trying to regain its cachet as America's favourite international brew. The Dutch brewer, which grew to become the No. 1 U.S. import after the first crate arrived in New York Harbour in 1894, has slipped to second place behind Corona of Mexico. Heineken has been trying to catch up spending on average US$51-million annually on marketing. Corona spends about US$35-million annually to promote Corona in the U.S. and has 29 per cent of the market compared to 19 per cent for Heineken.
OLYMPICS
Moscow has officially entered the battle to host the 2012 Olympics, joining Paris, London, New York, Madrid, Havana and Leipzig. Brazil is considering nominating Rio de Janeiro or San Paulo. It is estimated that these games will cost US$7-billion to stage. The 2004 games are in Athens and Beijing will host the event in 2008.
DIAMONDS
Canada's burgeoning diamond industry is suffering from a lack of labour. Diamond mines across the country are scrambling to find everything from skilled mine operators to trained diamond cutters and polishers. Without tradespeople to turn the diamonds into jewellery, the industry stands to lose a lot of money. Immigrants from Armenia, the Ukraine and Mauritius are bailing the industry out for now. But with the certification program for sorting, cutting and polishing in Yellowknife taking three years to complete, the shortage is going to linger on.
RAIN
President Putin ordered fine weather for the St Petersburg summit and its 300th anniversary festivities recently. Ten aircraft took to the skies, equipped with cloud-seeding agents in an attempt to induce rain away from the city allowing tourists and visiting heads of state to enjoy dry weather below.
GM
The United States (with Argentina, Canada and Egypt) is to challenge the European Union's moratorium on genetically modified food at the World Trade Organisation. It contends that blocking imports of American crops has no scientific basis. The move came soon after the EU said that it would impose trade sanctions over America's tax treatment of exporting firms.
NOISE
Restaurants have become a new battlefield in the noise wars. In San Francisco, restaurant critics carrying meters that measure decibels and noise ratings are getting a very positive feedback. Would-be diners are avoiding places where you have to raise your voice to talk.
BEAUTY
It is estimated that the global beauty industry, encompassing make-up, skin and hair care, fragrances, cosmetic surgery and diet pills, is worth US$160-billion annually. Analysts estimate that skin care is worth US$24 billion annually; make-up, $18-billion; $38 billion of hair care products; and $15-billion of perfumes and that the market is growing at 7 per cent a year. This growth is being driven by richer, aging baby-boomers, increased discretionary income in the West and by the growing middle-classes in developing countries.
WATER
India's ruling party has launched a campaign to gather public support for one of India's most ambitious projects, the linking of rivers across the country. The project aims to connect nearly 30 rivers in the country and it is estimated that it will cost over US$100-billion. It envisages diverting water from surplus river basins to water deficient areas.
CALL CENTRES
North American businesses have long outsourced some operations to cut costs. Recently, the technology industry has increasingly outsourced tasks, call-centres included. Low-wage workers are the key draw. An entry-level programmer in China cost 30 to 50 per cent less than one in Tokyo, London or Chicago. Experts estimate that the number of computer jobs moving overseas will grow from just over 27,000 in 2000 to a cumulative total of 473,000 by 2015.
CANADIAN FARMS
Net cash income, the difference between a farmer's cash receipts and operating expenses, tumbled 10.6 per cent to C$7.7-billion in 2002 after setting a record high in 2001. Cash receipts fell for the first time since 1998 in the wake of back to back droughts, while higher feed grain costs drove up operating expenses. Western farmers experienced one of the poorest growing seasons in the past quarter century in 2002. The situation for some growers in Alberta and Saskatchewan was worse than in the depression of the 1930s.
TRIVIA
According to a U.S. menswear industry observer, the average man changes his suit size every three years.
TEXTILES
China Daily reports China's exports of textiles are being "torn to shreds" as foreign buyers concerned about the SARS epidemic shift their orders to Pakistan, India, and Turkey. Face to face contact is required to finalize most orders, but visits from American and European buyers have dropped significantly. Recent travel warnings issued by the US State Department have resulted in a decrease in travel to Southeast Asia, especially to Mainland China and Hong Kong.
DRONES
Pilotless planes, more commonly known as drones, which the U.S. used in Iraq, will be tested in Ohio to see whether they can battle a more down-to-earth hazard: traffic jams. Transportation officials believe that they hold promise as a way of keeping an eye on traffic, route trucks and fix stoplights so traffic flows better. Data on traffic flow now comes from detectors embedded in the pavement or the black pneumatic tubes stretched across roads. Another possibility includes the use of cameras in tethered balloons.
LONGEVITY
The Kongo family knows a thing or two about running a business. The family's construction company in western Japan has been going strong for more than 14 centuries, spanning 40 generations. The company has survived everything from feudal wars to the more recent collapse of the nations's economic bubble. The company began building temples for the Japanese emperor in 578.
INFLUENCE
Children in the U.S. hold massive consumer power in the food and beverage industry. According to the U.S. Market for Kids Foods and Beverages study, children between the ages of 5 and 14 will directly control $10-billion in food and beverage spending this year and will influence the vast majority of purchases made in this category.
LUXURY
The new Rolls-Royce Phantom includes two custom-made umbrellas that stow inside the rear doors. When the car owner (or chauffeur) pushes a silver button, the unbrellas' handles slide out. When one of the full-sized umbrellas is returned to its door compartment, a channel drains the moisture away.
SELF-DESTRUCT
In August, the Disney company will introduce a DVD for rental which will self-destruct in 48 hours. After two days the disc will become unplayable and does not have to be returned. The discs stop working when a process similar to rusting makes them unreadable after exposure to oxygen.
DIRECTIONS
It used to be that only high-priced luxury cars came with satellite navigation systems to help drivers in unfamiliar places. Now, more car makers, including Honda, Nissan and Toyota, are offering optional in-dash navigation systems for around $2,000. The systems are available in more than 60 car models today, up from just seven in 1998. It is estimated that 300,000 cars were sold in the U.S. last year with navigation systems.
FORGERY
Cheap inkjet printers, often given away with personal computers, are being used to forge banknotes that pass for the real thing in pubs and night clubs. Banks and governments have been briefed by De La Rue, a world leader in security printing. Fierce competition in the inkjet market has made digital colour printers so cheap and the print quality so high that a $200 printer can produce fake banknotes that are easily mistaken for genuine currency in dim light.
PEOPLE
The Russian Government has announced plans to resettle up to 600,000 people from the country's remote far north. Inhabitants from such regions as Kamchatka, Yakutia, Chukoyka and Evenkia will be moved to south or central Russia. Many town and villages in the remote regions are based on failing single industries and there is no point in developing infrastructure in the areas. The World Bank is contributing a US$50-million loan to the project.
CLOTHES
For years, department stores' bread and butter was clothes. But now, many retailers are finding that foot traffic is driven by other goods---groceries, furnishings and automotive products are increasing their presence, shoving aside apparel. Apparel sales, including footwear and accessories, fell by two per cent in 2002 to US$220-billion, the second consecutive year of decline. Meanwhile, food sales jumped 8 per cent and electronics rose two per cent. Many stores rely on apparel for nearly 80 per cent of their sales.
IRRADIATION
Banks, insurance companies and other institutional lenders are starting to weigh the cost-benefits of irradiating ground beef, poultry and other foods as part of their due diligence on loans to restaurant chains, food service providers, food processors and food retailers. In 2002, there were 66 recalls in the U.S. for listeria or E.coli-contaminated beef, pork and poultry. The largest recall involved 22 million pounds of product and cost US$81-million, not including litigation costs. It is estimated that irradiation costs 7 cents a pound for ground beef.
MARRIAGE
The number of couples who got married in Canada hit the highest level in five years in 2000. In Quebec, where the trend to common law unions has traditionally been strongest, the number of marriages increased for the first time in 12 years. A total of 24,912 couples went to the altar in Quebec in 2000, up 8.7 per cent from 1999, the strongest gain among the provinces. Nationally, a total of 157,395 couples tied the knot in 2000, up 1.1 per cent from 155,742 in 1999. This was still well below the most recent high of 160,251 in 1995.
AUDITS
Canada's Auditor General is to face an audit by a team of global experts. Canada's spending watchdog employs 575 people and has a budget of C$66-million a year. A Global Working Group, an organization composed of public auditors from 15 countries, met and agreed a plan under which teams made up of their own members would audit each other's operations. Canada will be audited by British, Dutch and Norwegian auditors. The results will be published in 2004. The General Accounting Office of the U.S. will be audited next year.
SENSITIVITY
More than 2,000 employees of a British company were recently fired, not by the usual pink-slip method, but by text messages sent to their cell phones. The messages sent were, "Don't contact the office. Salaries will not be paid," and "If you have not been spoken to, you are therefore being made redundant, with immediate effect."
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
Heineken, the first foreign beer drunk by Americans after the end of Prohibition, is trying to regain its cachet as America's favourite international brew. The Dutch brewer, which grew to become the No. 1 U.S. import after the first crate arrived in New York Harbour in 1894, has slipped to second place behind Corona of Mexico. Heineken has been trying to catch up spending on average US$51-million annually on marketing. Corona spends about US$35-million annually to promote Corona in the U.S. and has 29 per cent of the market compared to 19 per cent for Heineken.
OLYMPICS
Moscow has officially entered the battle to host the 2012 Olympics, joining Paris, London, New York, Madrid, Havana and Leipzig. Brazil is considering nominating Rio de Janeiro or San Paulo. It is estimated that these games will cost US$7-billion to stage. The 2004 games are in Athens and Beijing will host the event in 2008.
DIAMONDS
Canada's burgeoning diamond industry is suffering from a lack of labour. Diamond mines across the country are scrambling to find everything from skilled mine operators to trained diamond cutters and polishers. Without tradespeople to turn the diamonds into jewellery, the industry stands to lose a lot of money. Immigrants from Armenia, the Ukraine and Mauritius are bailing the industry out for now. But with the certification program for sorting, cutting and polishing in Yellowknife taking three years to complete, the shortage is going to linger on.
RAIN
President Putin ordered fine weather for the St Petersburg summit and its 300th anniversary festivities recently. Ten aircraft took to the skies, equipped with cloud-seeding agents in an attempt to induce rain away from the city allowing tourists and visiting heads of state to enjoy dry weather below.
GM
The United States (with Argentina, Canada and Egypt) is to challenge the European Union's moratorium on genetically modified food at the World Trade Organisation. It contends that blocking imports of American crops has no scientific basis. The move came soon after the EU said that it would impose trade sanctions over America's tax treatment of exporting firms.
NOISE
Restaurants have become a new battlefield in the noise wars. In San Francisco, restaurant critics carrying meters that measure decibels and noise ratings are getting a very positive feedback. Would-be diners are avoiding places where you have to raise your voice to talk.
BEAUTY
It is estimated that the global beauty industry, encompassing make-up, skin and hair care, fragrances, cosmetic surgery and diet pills, is worth US$160-billion annually. Analysts estimate that skin care is worth US$24 billion annually; make-up, $18-billion; $38 billion of hair care products; and $15-billion of perfumes and that the market is growing at 7 per cent a year. This growth is being driven by richer, aging baby-boomers, increased discretionary income in the West and by the growing middle-classes in developing countries.
WATER
India's ruling party has launched a campaign to gather public support for one of India's most ambitious projects, the linking of rivers across the country. The project aims to connect nearly 30 rivers in the country and it is estimated that it will cost over US$100-billion. It envisages diverting water from surplus river basins to water deficient areas.
CALL CENTRES
North American businesses have long outsourced some operations to cut costs. Recently, the technology industry has increasingly outsourced tasks, call-centres included. Low-wage workers are the key draw. An entry-level programmer in China cost 30 to 50 per cent less than one in Tokyo, London or Chicago. Experts estimate that the number of computer jobs moving overseas will grow from just over 27,000 in 2000 to a cumulative total of 473,000 by 2015.
CANADIAN FARMS
Net cash income, the difference between a farmer's cash receipts and operating expenses, tumbled 10.6 per cent to C$7.7-billion in 2002 after setting a record high in 2001. Cash receipts fell for the first time since 1998 in the wake of back to back droughts, while higher feed grain costs drove up operating expenses. Western farmers experienced one of the poorest growing seasons in the past quarter century in 2002. The situation for some growers in Alberta and Saskatchewan was worse than in the depression of the 1930s.
TRIVIA
According to a U.S. menswear industry observer, the average man changes his suit size every three years.
TEXTILES
China Daily reports China's exports of textiles are being "torn to shreds" as foreign buyers concerned about the SARS epidemic shift their orders to Pakistan, India, and Turkey. Face to face contact is required to finalize most orders, but visits from American and European buyers have dropped significantly. Recent travel warnings issued by the US State Department have resulted in a decrease in travel to Southeast Asia, especially to Mainland China and Hong Kong.
DRONES
Pilotless planes, more commonly known as drones, which the U.S. used in Iraq, will be tested in Ohio to see whether they can battle a more down-to-earth hazard: traffic jams. Transportation officials believe that they hold promise as a way of keeping an eye on traffic, route trucks and fix stoplights so traffic flows better. Data on traffic flow now comes from detectors embedded in the pavement or the black pneumatic tubes stretched across roads. Another possibility includes the use of cameras in tethered balloons.
LONGEVITY
The Kongo family knows a thing or two about running a business. The family's construction company in western Japan has been going strong for more than 14 centuries, spanning 40 generations. The company has survived everything from feudal wars to the more recent collapse of the nations's economic bubble. The company began building temples for the Japanese emperor in 578.
INFLUENCE
Children in the U.S. hold massive consumer power in the food and beverage industry. According to the U.S. Market for Kids Foods and Beverages study, children between the ages of 5 and 14 will directly control $10-billion in food and beverage spending this year and will influence the vast majority of purchases made in this category.
LUXURY
The new Rolls-Royce Phantom includes two custom-made umbrellas that stow inside the rear doors. When the car owner (or chauffeur) pushes a silver button, the unbrellas' handles slide out. When one of the full-sized umbrellas is returned to its door compartment, a channel drains the moisture away.
SELF-DESTRUCT
In August, the Disney company will introduce a DVD for rental which will self-destruct in 48 hours. After two days the disc will become unplayable and does not have to be returned. The discs stop working when a process similar to rusting makes them unreadable after exposure to oxygen.
DIRECTIONS
It used to be that only high-priced luxury cars came with satellite navigation systems to help drivers in unfamiliar places. Now, more car makers, including Honda, Nissan and Toyota, are offering optional in-dash navigation systems for around $2,000. The systems are available in more than 60 car models today, up from just seven in 1998. It is estimated that 300,000 cars were sold in the U.S. last year with navigation systems.
FORGERY
Cheap inkjet printers, often given away with personal computers, are being used to forge banknotes that pass for the real thing in pubs and night clubs. Banks and governments have been briefed by De La Rue, a world leader in security printing. Fierce competition in the inkjet market has made digital colour printers so cheap and the print quality so high that a $200 printer can produce fake banknotes that are easily mistaken for genuine currency in dim light.
PEOPLE
The Russian Government has announced plans to resettle up to 600,000 people from the country's remote far north. Inhabitants from such regions as Kamchatka, Yakutia, Chukoyka and Evenkia will be moved to south or central Russia. Many town and villages in the remote regions are based on failing single industries and there is no point in developing infrastructure in the areas. The World Bank is contributing a US$50-million loan to the project.
CLOTHES
For years, department stores' bread and butter was clothes. But now, many retailers are finding that foot traffic is driven by other goods---groceries, furnishings and automotive products are increasing their presence, shoving aside apparel. Apparel sales, including footwear and accessories, fell by two per cent in 2002 to US$220-billion, the second consecutive year of decline. Meanwhile, food sales jumped 8 per cent and electronics rose two per cent. Many stores rely on apparel for nearly 80 per cent of their sales.
IRRADIATION
Banks, insurance companies and other institutional lenders are starting to weigh the cost-benefits of irradiating ground beef, poultry and other foods as part of their due diligence on loans to restaurant chains, food service providers, food processors and food retailers. In 2002, there were 66 recalls in the U.S. for listeria or E.coli-contaminated beef, pork and poultry. The largest recall involved 22 million pounds of product and cost US$81-million, not including litigation costs. It is estimated that irradiation costs 7 cents a pound for ground beef.
MARRIAGE
The number of couples who got married in Canada hit the highest level in five years in 2000. In Quebec, where the trend to common law unions has traditionally been strongest, the number of marriages increased for the first time in 12 years. A total of 24,912 couples went to the altar in Quebec in 2000, up 8.7 per cent from 1999, the strongest gain among the provinces. Nationally, a total of 157,395 couples tied the knot in 2000, up 1.1 per cent from 155,742 in 1999. This was still well below the most recent high of 160,251 in 1995.
AUDITS
Canada's Auditor General is to face an audit by a team of global experts. Canada's spending watchdog employs 575 people and has a budget of C$66-million a year. A Global Working Group, an organization composed of public auditors from 15 countries, met and agreed a plan under which teams made up of their own members would audit each other's operations. Canada will be audited by British, Dutch and Norwegian auditors. The results will be published in 2004. The General Accounting Office of the U.S. will be audited next year.
SENSITIVITY
More than 2,000 employees of a British company were recently fired, not by the usual pink-slip method, but by text messages sent to their cell phones. The messages sent were, "Don't contact the office. Salaries will not be paid," and "If you have not been spoken to, you are therefore being made redundant, with immediate effect."
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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