Thursday, January 01, 2015

January 2015 Economic Digest - Importing and Exporting

January 2015 Edition


CORRUPTION

Canada is rated second among countries with the lowest business bribery risk in a new survey of 197 nations. Out of a maximum of 100, the higher the score the higher the risk, Canada got 22. Ireland is first with 20 while the US is in 10th place with 27. Other countries in the top ten are New Zealand, Hong Kong and Sweden all with 23, Finland, 24, Singapore and Japan 26 and Germany with 27. Nigeria is the worst rated country with 97. India was far down the list in 185th spot with a score of 80 with Brazil in 149th position with 69. China’s score was 66 and the Russian Federation 65.

CYCLING

Florida has been America’s deadliest state for bicycle riders for many years. In 2012, some 120 cyclists were killed in traffic accidents, three times the national average. The poor design of roads and cities is largely to blame. An official said that a fairer comparison would be to compare annual deaths relative to miles traveled which is done with automobiles but not bicycles. Deaths in Florida are far more than in California which has double the population.

SECURITY

Acknowledging security gaps that could leave airliners vulnerable to attack, the Canadian government is moving ahead with a new system that would allow shippers to screen cargo before it gets to the airport. Transport Canada says the system would bring air cargo screening up to the standards of key trading partners and result in a net benefit to Canadians of C$202-million over 10 years. In Canada, about half of all cargo is carried on passenger flights totaling more than 400-milion kilograms annually.

FUEL

Canada has roughly 173-billion barrels of oil reserves, of which 167-billion barrels are in the controversial oil sands. Exports of oil bring more than $C220-million a day in revenue. Oil and gas are a key part of Canada’s economy creating 550,000 direct and indirect jobs in 2013 and paying about $18-billion annually to all levels of government.

NAVAJO

The US government has agreed to pay US$554-million to the Native American Navajo tribe to settle a legal dispute. This is the largest payment ever made by the government to a single tribe. The Navajos are the largest Native American tribe with more than 300,000 members. About 14-million acres of Navajo land is leased out for purposes including farming, oil and gas production and mining. In 2012, the US reached a similar settlement with 41 tribes, agreeing to pay out about $1-billion.

MYOPIA

In 1970, fewer than a third of 16- to 18-year-olds in China were deemed to be short-sighted, now, nearly four-fifths are. The fastest increase is among primary school children, over 40 per cent of whom are shortsighted, double the rate in 2000. That compares with less than 10 per cent of this age group in the US or Germany. The incidence of myopia is high across East Asia, afflicting 80-90-per cent of urban 18-year-olds in Singapore, South Korea and Taiwan. The problem is social rather than genetic. The biggest factor in shortsightedness is a lack of time spent outdoors.

LOCOMOTIVES

As railways try to keep pace with soaring freight volumes, they are facing a shortage of locomotives. One of the two US manufacturers is out of the market for two years until it can meet tougher emission standards in the US. The shortage is hampering efforts of railways to clear congested tracks and move the growing amounts of grain, oil and other goods. It is also spurring rail companies to repair and overhaul older equipment. GE has seen locomotive demand rise by 134 per cent in 2013 and has received orders for 1,000 of the lower-emission engines which cost as much as US$3-million each.

TRAFFIC

In general, video and audio streaming continues to eat up the greatest traffic on virtually every network. In North America, during the prime-time hours of 6pm to 10pm, Netflix and YouTube account for half of all internet traffic. By contrast, Amazon Instant Video garnered just 1.61 per cent of the traffic.

SALT

According the UN, about 2,000 hectares of fertile land are lost each day to damage caused by salt. The total area now affected is equivalent to the size of France, 62-million hectares, which has increased from 45-million 20 years ago. Salt degradation occurs in areas of dry irrigated land with little rainfall and where there is no natural drainage. The report suggests that tree planting, deep ploughing and the production of salt-tolerant crops and digging drains or ditches around the affected areas would help. The measures would be expensive, around US$23-billion, but the cost of inaction will be worse. In the Colorado River Basin, damage from salt could cost up to $750-million annually.

GMO

A majority of US packaged foods labeled as “natural” and tested by Consumer Reports actually contained a substantial level of genetically modified ingredients. Consumers Reports says that consumers are being misled by the “natural” label. They conducted a survey of 80 different processed foods containing corn or soy, the two most widely grown genetically engineered crops in the United States, to determine whether labeling claims for GMO presence were accurate.

DATING

In its first law enforcement action against an online dating service, the US Federal Trade Commission has reached a settlement that prohibits an England-based dating service from using fake, computer-generated profiles to trick users into upgrading to paid memberships and charging these members a recurring monthly fee without their consent. The settlement also requires the defendant to pay US$616,165 in redress.

CARE

According to Statistics Canada, in 2013 13 per cent of Canadians (3.7-million) aged 15 and over, reported providing end-of-life or palliative care to a family member or friend at some point in their lives. These caregivers helped the terminally ill with such tasks as personal or medical care, preparing meals, managing finances or providing transportation to and from medical appointments. Providing end-of-life care was most often a reality for those in their 50s and 60s. About one in five of these Canadians reported that they had provided palliative care to a parent, spouse, grandparent, other family member or friend.

SCOTCH

The Scots are famous for their whisky but will be licking their wounds after a Japanese single malt was recently named the best in the world. Yamazaki Single Malt was given the title by the 2015 World Whisky Bible. This year marks the first time in the book’s 12-year history that a Japanese whisky has landed the title. To add insult to injury, not a single Scotch managed to make the final five shortlist.

LABELLING

Serial numbers no longer need to be visible on the surface of devices such as smart phones or wearable technology such as smart watches in Canada, thanks to new electronic labeling technology. Previously, Canadian regulations required information such as serial or model identification numbers, registration numbers for terminal equipment devices and certification numbers for radio equipment to be printed directly on the device or attached with a sticker. This meant that some devices marketed in other parts of the world could not enter Canada. Now, high-tech devices with a non-removable screen can carry the information on an e-label.

BATTERIES

Engineers in the US have produced child-safe batteries with a special coating that stops them causing harm if they are swallowed. Small, button-shaped batteries can be easy to swallow and cause thousands of injuries each year, some fatal. The new coating only conducts electricity when squeezed, such as when a battery is inside its spring-loaded compartment.

DRIVING

Fleets of self-driving trucks could be tested on UK roads this year. The technology allows a convoy of trucks to travel just a few feet from each other, with only the driver at the front in control. The initiative will help cut fuel consumption. The technology still requires a driver to be in each vehicle in the event of an emergency, but for the most part drivers will be able to relax. Each truck will communicate via wi-fi, infrared cameras and laser sensors.

AUCTIONS

International art auction house Sotheby’s and eBay will create a web platform to allow viewers to bid on and buy art. Sotheby’s says the number of lots purchased on line increased 36 per cent in 2013 and online art sales are expected to reach US$13-billion by 2020. The venture will start with live auctions streamed from Sotheby’s New York headquarters which will allow real-time bidding from anywhere in the world. Last year, Amazon announced it would sell works of art on its website.

CONSTRUCTION

The forest industry’s vision of pushing wood-structure buildings higher in Canada is to get a major boost. The federal body that establishes the standards for building codes is preparing to raise the cap on wood-structure heights from four storeys to six storeys. The decision will help vitalize a moribund forestry industry seeking to reach into innovative products and conquer new export markets. The sector’s goal is to build 10-storey structures by 2020 and says 30 floors are not out of the question one day.

DENGUE

Thousands of mosquitoes have been released in Brazil with a dengue blocking bacteria. The hope is they will multiply, breed and become the majority of mosquitoes, thus reducing cases of the disease. The initiative is part of a programme also taking place in Australia, Vietnam and Indonesia. Dengue re-emerged in Brazil in 1981 after an absence of more than 20 years. Over the next 30 years seven million cases were reported and 800 deaths were reported in the 2009 to 2014 period.

SMUGGLING

Venezuela’s western border is a smuggler’s paradise. Everything from rice to cement finds its way over the frontier into Colombia. The most lucrative trade is gasoline. It is estimated that the equivalent of 100,000 barrels of oil a day is smuggled out of the country. Gasoline is so cheap in Venezuela because of state subsidies and price controls, that to fill a 50-litre car tank costs well under US$1.00. Over the border the gasoline is $1.20 a litre. In an attempt to plug the leaks, the Venezuelan government has begun nightly closures of its 2,200 kilometre border with Colombia.

IMMIGRANTS

A new study shows that immigrants to the UK from 10 countries that joined the EU in 2004 contributed more to the UK than they took out in benefits. They added US$8-billion more in taxes in the years to 2011 than they took out in public services. Immigrants who arrived since 2000 were 43 per cent less likely to receive state benefits or tax credits, and seven per cent less likely to live in subsidized housing.

WINDOWS

Momentum continues to grow for the construction of planes without windows. A new design has drawn up plans for the creation of a plane that would feature flexible screens wrapped into the interior of the cabin. The screens would be covered in Organic Light Emitting Diode (OLED) technology which could broadcast film or television footage, be used for video conferencing and presentations or display images of the views surrounding the plane transmitted via cameras on the aircraft’s exterior. Reducing windows on a plane would significantly reduce their weight and improve aerodynamics, resulting in quicker flights, lower fuel costs and cheaper tickets.

CREDIT

Recently, President Obama’s credit card was declined at a New York restaurant. Fraud was expected as the card is rarely used. Fortunately, First Lady Michelle Obama had a card which was used to pay for the meal.
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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