Saturday, July 01, 2006

July 2006 Economic Digest - Importing and Exporting

July 2006 Edition


SERVICE
 
Customer service at U.S. airlines during the first quarter of this year was the worst it has been in five years according to a University of Michigan index that ranks customer satisfaction. Only cable television, satellite services and newspapers ranked lower than the airlines. The survey also examined industries such as utilities, health care, telecommunications and food service. The largest U.S. airlines have been shedding staff as they try to stem US$40-billion in losses since 2000.

DEVICES

The still, standard equipment for any moonshiner, has a shot at becoming the must-have accessory of penny pinching motorists. An upstart Tennessee business is marketing stills that can be set up as private distilleries to make ethanol out of fermented starchy crops such as corn, apples or sugar cane. The company claims the still's output can reduce fuel costs by nearly a third from the pump price of gasoline.

GO FIGURE

A major Japanese software-services company intends to hire 2,500 people in India in the next two years as demand for its services increases. Meanwhile, the leading Indian software exporter announced it will hire as many as 10,000 people in China in the next three years to make up for shortages in talent in India.

GAMES

Video games are transforming technology, education and the U.S. economy. A new study has concluded that the multi-billion dollar industry is growing fast and stimulating innovation in areas ranging from medicine to anti-terrorism technology. It is predicted that U.S. video games software sales will reach US$15-billion and the industry will support more than 250,000 high-skilled jobs by 2010.

WEEDS

Researchers at the University of Guelph have found that the roots of a weed known as garlic mustard are poisoning plants and even trees in Ontario, Quebec and the Maritime provinces. Most plants generate fungi from their roots that act as nutrients. Garlic mustard, on the other hand, produces chemicals that act as fungicides that linger in the soil long after the weed has been removed killing off the fungi that provide critical food to neighbouring plants and trees.

WATCHES

Tourists checking onto hotels in Naples this year are to receive an unusual gift as part of an innovative scheme to protect visitors from watch-snatchers. Each guest will find a cheap plastic watch by their beds emblazoned with a motif of either a pizza or Mount Vesuvius with a request to leave expensive watches in hotel safes.

COPPER

As international markets register all-time high prices for copper, the scrap value of coins could now be worth 50 per cent more than their face value. In Britain, a ton of two pence coins (145,000) has a face value of around US$5,800. The metal at current prices on the open market could turn a handsome profit of at least $3,000, though it is an offence to deface a coin. The U.S. mint estimates it now costs 1.23 (US) cents to make a 1-cent coin and 5.73 cents to produce a nickel. Canada uses a cheaper manufacturing process and a penny is still economical at eight-tenths of a Canadian cent to make and nickels cost a mere one cent.

TECHNOLOGY

A dragonfly was recently fitted with a tiny transmitter and chased by a planeload of scientists as it flew up to 100 miles a day along the east coast of the U.S. managing an overall migration of around 500 miles seeking warmer temperatures. The study showed that the insects use remarkably similar navigation methods to those of birds, specifically kestrels, which may have learned migration patters by following, and eating, dragonflies. The transmitters used weighed only one third of a gram.

FLOWERS

Imports of cut flowers to Britain produce emissions of at least 110,000 tonnes of carbon dioxide according to new research. This is raising a new issue called "flower miles", the term for carbon dioxide emissions released by planes bringing in thousands of tonnes of cut flowers to the country. Between 2001 and 2005, the volume of cut flowers imported from Kenya, which supplies more than a third of Britain's cut flowers, increased to 18,700 tonnes from 10,000 tonnes.

BARRIERS

In a pact that has been in the works since 2003, Alberta and British Columbia have signed a deal aimed at slashing trade barriers and bureaucratic red tape and increasing labour mobility between the two Western provinces. It will be phased in starting next April and will harmonize regulations and licensing procedures and reduce costly paperwork between the two jurisdictions to create the country's second largest economic trade zone behind Ontario.

DRUGS

Canadians spent almost C$25-billion on prescription and non-prescription drugs in 2005, an 11-per-cent jump from the previous year. In 1986, prescription drug spending was C$3-billion in Canada; today, it is C$20.6-billion and by 2010 it is expected to reach C$30-billion.

CHEESE

British stores are set to launch a cheddar cheese that claims to actually reduce artery clogging fat. The cheese is enhanced with an ingredient called Ruducol, made by a Vancouver, B.C. laboratory which contains plant extracts that have been shown to help people lower their cholesterol in clinical trials. The cheese has a low fat content of 12 per cent. A typical cheddar is usually between 30 per cent and 40 per cent fat.

COFFEE

So many of China's middle classes have begun drinking cappuccino and caffe latte that the country's labour ministry has declared an official skills shortage. About 10,000 trained coffee makers and servers are needed in Beijing and Shanghai alone according to a government survey. There is no lack of barmen and waiters looking for good jobs but most of them have never made a cup of coffee in their lives as China has traditionally been a tea-drinking country.

SAVINGS

The Canadian Forces have started applying for federal excise-tax rebates for all the domestic fuel its warships burn when they are beyond the country's offshore territorial limit of 12 nautical miles. The new tax break, which requires detailed computer tracking, is expected to save the military about C$1.2-million in fuel costs each year. The Canadian Forces are keen to shave any amount they can from a massive annual bill of between C$400- and $500-million for fuels and lubricants.

DISPUTES

Iceland has the most fractious industrial relations in the OECD. Its strike rate, the number of days lost to labour disputes per 1,000 employees, averaged 581 days a year from 1995-2004. In 1995, its worst year, Iceland lost almost two days to strikes for every worker in the economy. The OECD strike rate of 39 in 2004 was higher than the year before but lower than its average over the preceding decade.

INCOME

While China is a big economy, it is still a poor one. It ranked only 108th in income per head in 2004 according to the World Bank.

CHOPSTICKS

China has slapped a 5-per-cent tax on chopsticks over concerns of deforestation. The move is hitting hard at the Japanese who go through a tremendous 25 billion sets of wooden chopsticks a year, about 200 pairs per person. Some 97 per cent of them come from China. Chinese chopstick exporters have responded to the tax increase and a rise in other costs by slapping a 30-per-cent hike on chopstick prices, with a planned additional 20-per-cent increase pending. The price hike has sent Japanese restaurants scrambling to find alternative sources.

WORK

In Britain, more than one in 10 workers, 13 per cent, say they don't arrive on time at the office at least once a week and 24 per cent admitted to failing punctuality at least once a month. The biggest reason for tardiness for 27 per cent of the 2,500 respondents, was traffic. 11 per cent blame falling back asleep and 10 per cent cited getting their children ready for school.

ACCESS

Kenyan officials have complained that African Internet users pay on average 50 times what U.S. surfers pay which makes it hard for the poorest continent to become competitive in a global economy. U.S. users pay about US$20 for a gigabyte of data a month, but Africans pay about $1,800 for the same amount.

OIL

Canada's crude oil production is expected to nearly double over the next 15 years with the vast majority of new oil coming from Alberta's oil sands. Total oil production will grow from 2.5 million barrels a day in 2005 to 4.6 million by 2015 and as high as 4.9 million by 2020. However, lack of skilled workers, machinery and refinery capacity could prevent these figures from being reached.

HEALTH

The Economist reports that America's medical system has long seemed a poor bargain. Americans spend far more on health care than the inhabitants of other rich countries, but their life expectancy is below the wealthy world's average. Annual medical costs in the U.S. are US$5,635 per person compared with $2,231 in Britain. Yet an American's life expectancy at birth is 77.2 years compared with 78.5 in Britain.

BUSINESS

The personal services industry that provides services ranging from haircuts and facials to laundry and funerals in Canada is growing. In 2004, firms providing personal services earned an estimated C$8.6-billion,up from C$7.6-billion in 2002. Personal care providers, which include hair and esthetic salons, spas and the like accounted for 46 per cent of the industry's total income with earnings of C$3.9-billion in 2004 while laundry and dry cleaning services earned nearly C$1.9-billion.

BAMBOO

Once only considered useful as a panda fuel, bamboo is now a trendy raw material used in everything from textiles to flooring. Consumers can now buy bamboo T-shirts, linens, jewellery and furniture, plus the usual cutting boards and salad bowls. Manufacturers call bamboo the new silicone and the new plywood. Textiles made from it are more absorbent than cotton and naturally anti-microbial. Bamboo is softer and lighter than cotton and breathes well making it an excellent material for bed linens.

AGING

The number of children in Japan has been falling for 25 straight years. Children and babies now make up 13.7 per cent of the population. This is even lower than other aging societies, including Italy (14.2 per cent) and Germany and Spain (both 14.5 per cent). Countries with relatively high 14-and-under- ratios include the Philippines with 34.7 per cent and Colombia with 31.7 per cent.

ACCOMMODATION

A California retiree has been persuaded by her architect to buy a junked jumbo jet and turn it into a mountainside house. The wings of the 747 will be made into a roof, the nose into a meditation temple and the remaining scrap will be turned into six more buildings including a guesthouse, yoga studio and caretaker's cottage.

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