August 2002 Economic Digest - Importing and Exporting

August 2002 Edition

COFFEE

 
Officials in Colombia say that coffee producers are facing a crisis that will affect 25 million families worldwide. In 1997, consumers around the world spent US$30-billion on coffee, of which producers received US$12-billion, or 40 per cent. This year, consumers will spend a predicted US$60-billion, but coffee growers will only receive US$5.5-billion, slightly less than 10 per cent. Earlier in the year, Colombian coffee prices were at their lowest in 100 years.

ENERGY

Britain's first cowpat-fired power station will begin producing electricity within a month. The plant will use 146,000 tonnes of liquid slurry a year. As well as generating an estimated 1.4 megawatts, the plant will provide hot water to heat local public buildings. Twenty-seven farmers have signed up to supply 450 tonnes of liquid slurry a day. It will be heated to encourage gas-producing bacteria and the residue returned to farmers as concentrated organic fertilizer. It is hoped to establish 100 such plants across Britain.

NAKED

Animal rights campaigners are angered by a new breed of "naked" chicken created by scientists searching for tastier, healthier poultry. Despite it's bizarre appearance, the red skinned broiler could become a supermarket success because it is designed to grow faster, and contain less fat than normal chickens. It will also be cheaper to produce since its lack of feathers means there is no reason to pluck it before it hits the shelves.

LABOUR

The economic rebound could create a shortage of skilled labour in Ontario's information technology (IT) sector this year. A recent study suggests that as many as 38,000 new IT jobs will be added in 2002. Of those, as many as 9,900 could go unfilled because of a shortage of qualified workers.

PIRATES

Attacks by pirates surged worldwide in the first three months of 2002, with Africa rivalling Southeast Asia for the first time as a high-risk region. Indonesian waters remained the world's most pirate-infested, with 22 of 87 attacks reported in this period. But African countries had 32 attacks. Guinea, the Ivory Coast, Nigeria, Somalia, Tanzania and the Red Sea were the worst-hit areas. The global figure was up 28 per cent from the 68 actual and attempted attacks in the same period last year.

SHOPPING

An ACNielson study says that US consumers are shopping less frequently in traditional grocery stores while increasing their trips to supercentres and dollar stores. These are showing gains both in percentage of households who shop in those channels and in the number of trips consumers take to them each year.

BIOENGINEERING

A new study says that U.S. farmers are getting major benefits, both actual and potential, from bioengineered crops. In 2001, the eight modified plants that have been adopted by U.S. farmers--the most biotech receptive farmers in the world--increased production by 1.8 billion kilograms, saved US$1.2 billion in production costs and decreased pesticide use by about 21 million kilograms.

INTERNET

A recent Statistics Canada report says that almost a quarter million Canadian homes have dropped off the Internet. A little more than 232,000 Canadian households that had used Internet regularly, said they no longer did so. The most common reason given for dropping out of the on-line community was that people found they had "no need" for the Internet, a factor cited by 30 per cent of respondents. The results may also indicate lack of time for on-line activity or difficulty finding what they were searching for.

CRUSTS

In what is being billed as a time-saver for parents too busy to slice the crusts off their children's sandwiches, a U.S. food retailer has launched a line of crustless bread. The innovation is the latest in a string of food-marketing ploys designed to appease the fussy palates of children who obviously hold considerable sway over their parents' purchasing decisions. In past months the market has welcomed such kid-friendly products as sliced peanut butter, blue-coloured french fries and squeezable ketchup in purple, green, pink and orange.

CRIME

A new British study claims that feeding young prisoners cabbages, carrots and other fresh vegetables can help reduce the number of offenses they commit by more than a quarter. By adding vitamins, minerals and other nutritional elements, their anti-social behaviour was remarkably reduced. Researchers believe the findings might help prevent crime.

SCANNING

Canada's top retail groups are banding together to ensure that consumers are compensated when they catch an error at checkout price scanners. The groups are to unveil a code of conduct putting the onus on retailers to give shoppers money back if mistakes are made by scanners. A federal study of 83 stores across Canada, showed that some retailers were overcharging customers ten per cent of the time.

SINKING

A team of British experts has been called in to try and save Venice suffering increasing inundation from flooding. A controversial plan to build a Thames barrier-type structure with 79 gates, each weighing 300 tonnes, has been approved. Once built, the barrier will be raised when a high tide threatens to engulf the city. Last year, St. Mark's Square flooded more than 90 times. The population of the old city has halved to 70,000 in the last 50 years and the numbers continue to fall.

CHINA

A report by the World Trade Organization indicates that China has, for the first time, overtaken Canada to become the world's fourth largest trading economy after the European Union, the U.S. and Japan. China's exports reached US$266 billion in 2001, up 7 per cent from the previous year, while its imports rose 8 per cent year-on-year to reach US$244 billion.

WARMING

Over the last 50 years, a glacier on Everest has retreated three miles up the mountain due to global warming. A United Nations team has reported that the impact of rising temperatures was everywhere to be seen. The landscape bears the scars of sudden glacial retreat while glacial lakes are swollen by melted ice. The team reported that more than 40 Himalayan glacial lakes are dangerously close to bursting, threatening the lives of thousands of people.

BRITAIN

British cheese has suddenly become a fashionable delicacy for the Japanese and contributed to a ten per cent increase in British exports to Japan last year. Japan now features in the top ten list of buyers of British produce. It spent over half a billion Canadian dollars last year, 20 per cent of that on cheese. The total value of British food sold abroad was over C$17 billion.

AUTOS

Industry experts are forecasting that auto makers in North America will come out with 250 new or redesigned vehicles by 2007, a staggering number that represents almost a complete overhaul of everything they sell now. They will offer 100 new models and more than 150 redesigned vehicles resulting from the competitive pressure of the industry.

GROWING

It looks like a North Atlantic salmon but grows seven times faster and it's much more attractive to the opposite sex than a normal salmon. It's a transgenic fish, the first genetically engineered animal under review for the U.S. food supply. Embedded in every cell of its body are genes from the Chinook salmon that make it grow more quickly.

GRASS

The Public Utilities Commission in San Francisco has hired a herd of 400 goats to eat dense brush and weeds from the slopes of its rights-of-way. The animals are rented from Goats-R-Us and consume about an acre a day.

RADIO

Radio is making a comeback in Canada after several difficult years in the late 1980s and most of the 1990s, thanks mainly to FM broadcasting. The industry's profits represented 16.3 per cent of revenues in 2001, up from 13.6 per cent in 1998. The FM segment is one of the most profitable in broadcasting. The profit margin of FM stations has surpassed 25 per cent for the past three years, while AM stations have incurred losses. In 2001, 64 per cent of FM stations realized a profit, compared with only 41 per cent of AM stations.

FRUSTRATION

A Nova Scotia inventor claims to have the answer to what he believes to be one of life's greatest frustrations--waiting in a coffee shop lineup. He has been awarded a provisional patent on an automated coffee-refill system, in which customers are issued reusable mugs with personalized barcodes detailing their favourite type of coffee. A computer scans the barcode and tells the machine what sort of coffee to pour.

SUPPORT

The Canadian Agriculture Minister has announced that Canada will spend $175-million over the next six years to increase export markets for agricultural products. This will approximately double the amount the federal government normally spends to support Canadian agricultural products. The announcement was made the day after the World Trade Organization ruled that Canada's subsidies for some dairy products violate international trade rules.

GAINS

Because of the slumping economy and sagging stock markets, millionaires and billionaires had a hard time making money last year. Millionaires in North America, including about 165,000 in Canada, saw their total assets grow a mere 1.7 per cent last year to US$7.6-trillion. By contrast, the value of millionaires' assets jumped 18 per cent between 1999 and 2000.

TASTE

With little left in the ocean to catch, the fishing industry in Gloucester, Mass., has found a new commodity to market; the slime eel, which feeds off dead and dying fish. Fisheries are now selling seven million pounds a year of the pinkish-grey eels to South Korea. The South Koreans say the eels taste like clams.

TRENDS

A hard hat for building workers that allows employers to see what they are doing is now on trial on British construction sites. The "hatcam" is fitted with a camera and radio transmitter.

PRESCRIPTIONS

New data shows that Canadians spend an average of $500 each on drugs annually. All told, Canadians spent an estimated $15.5 billion on prescriptions and over-the-counter medications last year. In 1985, Canadians spent $3.8 billion on drugs. They now spend more than four times as much.

MISSING

The Bank of England has suspended issuing its new five-pound note after tests unveiled an apparent printing fault that allows the serial number to be rubbed of in some cases. 10 million of the new notes have been distributed. About 200 million of the old five-pound notes are in circulation.

TRIVIA

There are 21 amusement parks in Canada. They have an annual attendance of 12.6 million and revenues of C$336 million.

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

July 2002 Economic Digest - Importing and Exporting

July 2002 Edition

ANNIVERSARY

With this issue of the Economic Digest, we complete ten years of publication. Originally designed as a hard copy to be read with a cup of coffee and passed on, the majority of copies are now distributed electronically. We have published 120 editions, with 2,400 separate items and 210,000 words proving that almost anything has an economic impact to someone, somewhere. As the world of economics has moved along, so has A&A Contract Customs Brokers. Ten years ago, we were a mid-sized western customs broker with a staff of around 50 in five locations in the Lower Mainland of British Columbia concentrating on brokerage. Now, we have a staff of 120 and branches in Manitoba, Ontario, Quebec, Washington State and Pennsylvania. We have also added freight forwarding and warehousing to the services we offer clients. It will be interesting to see what the next ten years will bring.

ECONOMIES

If the Pacific NorthWest Economic Region were a nation, it would rank 11th among the world's leading industrial economies, with a combined population of more than 18 million and an annual gross regional product of over US$350 billion.

SPENDING

Canadian households spent an average of $55,830 in 2000 on everything from shelter to travel, allocating more to vehicle purchases and energy costs than in previous years. On average, households spent about 4 per cent more in 2000, a year of strong economic growth. Personal taxes accounted for an estimated 22 per cent of the household budget, shelter costs claimed about 19 per cent, and food, 11 per cent. These proportions were virtually unchanged from 1999. Transportation took up 14 per cent of the household budget, continuing the slight increase seen in 1999.

PORK

One of the most significant increases shown by the recent Canadian agricultural census was a 26 per cent jump in hog numbers since 1996, while the number of farms reporting hogs fell by nearly 27 per cent. International demand, particularly from the U.S. and Japan as well as new markets such as Mexico, was partly responsible for the increase. A number of tariff reductions, combined with the relatively low Canadian dollar and plentiful supplies of feed grain, have made Canadian pork increasingly attractive to international markets.

LAWN

Though not yet ready commercially, genetically altered grass is being developed which will inch up more slowly than regular grass so it requires less cutting and watering.

FUNDS

British Columbia is about to get C$12 million in federal money to organize and innovate business in the province. C$5.4 million will go to developing a single identification number for firms to deal with a range of federal and provincial government departments. This is considered a key to cutting through a lot of regulatory red tape to get access to services quickly. Another C$5.6 million will be put into an innovation investment program to help diversify B.C.'s economy.

FRUIT

Grapes, a relatively small commodity in terms of area farmed, have made a large impact since the industry was transformed by the Canada United States FTA in 1988. Since 1996, grape area has increased 41 per cent, the largest relative increase in area of the top five fruits grown in Canada.

TRIVIA

The London Observer reports that the Arctic ice cover is shrinking by an area the size of the Netherlands every year.

FEES

The costs of legal work by private firms for the Canadian government have increased on average 15 per cent per year over the past three years. Last year, the fees were a record C$63 million. The largest fee was C$10.9 million to a U.S. law firm mostly to act on its behalf in the battle over softwood lumber. Most of the increases are for legal work on international trade disputes for the Department of Foreign Affairs and International Trade. That ministry paid out C$13.7 million for legal representation, more than triple the C$4 million the previous year.

WASTE

As consumers acquire new models, old cellphones are making their way into incinerators and landfills. According to a new study, toxicants from the devices, such as lead and arsenic, become airborne or leach into the soil and groundwater. By 2005, as many as 130 million still-functioning cellphones could be heading for the garbage, representing 65,000 tons of hazardous waste each year.

FLOATING

Dangerous marine organisms are hitching rides across the world's oceans on an ever expanding flotilla of trash. Barnacles, worms, mollusca and other organisms previously limited to logs or ships or coconuts now have more travel opportunities than ever. Plastic has proved especially attractive because it is easy to grip, it doesn't rot and it moves more slowly than a ship.

CHECKOUT

Units of self-checkout equipment to retail grocery stores in the U.S. increased 142 per cent in 2001. This market should crack $1-billion in annual sales by 2003. Now that consumers are accepting it, twenty-five per cent of U.S. grocery retailers have self-checkout equipment installed.

FILMS

A recent study confirms that business is booming in Hollywood North. The amount of money spent to produce films in the U.S. dropped 17 per cent from 1998 to 2001. Meanwhile, the amount spent on production in Canada grew by 144 per cent. About US$750 million was spent last year in Canada to produce 29 films with budgets from $10- million to $50-million. In 1998, US$309-million was spent in Canada to produce 15 films in the same range.

SHEEP

Australian scientists have developed a hands-free way to harvest sheep. Instead of shearing sheep with instruments, farmers inject the animals with a naturally-occurring protein that causes a break in the wool. Farmers attach a net to their sheep and about a week later, they have a net full of fleece, and nearly-bald sheep. This has already been used on a quarter of a million Australian sheep. The Australian wool export industry is worth US$2.3-billion a year.

MAGAZINES

Reader's Digest is still the most widely read English-language magazine in Canada with eight million readers. Canadian Geographic is the nearest competitor with around five million readers. A recent study indicates that the readership of business magazines has dropped across the board.

WASTE

An ocean advocacy group describes the growing cruise industry as a floating environmental menace, with luxury ships free to dump millions of gallons of untreated waste and toxic chemicals into the oceans. The industry generates more than 400 million pounds of waste annually. Some larger cruise ships produce 37,000 gallons of oily bilge daily, 30,000 gallons of sewage, 255,000 gallons of wastewater from showers and sinks and 15 gallons of toxic chemicals from dry cleaning and photo processing.

TAMPERING

The USDA has prepared six pages of food safety guidelines telling plants how they should manage their security, production, workers, transportation and storage. The department is urging U.S. meat, poultry and egg plants to seal shipments and take other steps to protect the food supply from deliberate contamination.

MEXICO

This year, Mexico holds the rotating presidency of the Asia-Pacific Economic Cooperation trade group (APEC) and hopes to become a bridge for trade between Asia and the west. The free trade agreements Mexico has signed with 32 countries, make it the common element linking the leading markets in Europe and North America. The APEC region is the world's most dynamic and fastest growing and is home to half the world's total trade and production.

DEATHS

The International Labour Organization (ILO), reports that two million workers die each year because of accidents and illness in the workplace where they are exposed to hazards including chemicals, stress and passive smoking. The annual toll includes 12,000 children according to the report.

GREAT LAKES

Delegates to a National Marine Conference have been urged to explore new concepts of transportation to boost traffic on the Great Lakes and St. Lawrence Seaway system. Several proposals have been advanced which would also help relieve road congestion and protect the North American environment. These include the development of trans-Lake or inter-Lake roll-on-roll-off and ferry systems. In Europe and Japan such truck/trailer ferry systems are common and economically sound.

EXPANSION

The Wall Street Journal reports that the McDonald's Corp is exploring how to use its restaurant locations to sell items other than food. The company is about two years away from any sort of launch, but will be trying several experiments. There is little space to display merchandise or to store inventory. Clothes are probably out because of the odours from the food but some speculate that items such as stamps, videos and even watches are being considered.

FISHING

The headquarters of the European Union has announced plans for a radical overhaul of Europe's fishing industry. It calls for cuts of up to 60 per cent of its fishing fleets despite tough opposition from member nations. The plan would result in the withdrawal of some 8,600 boats from Europe's main fishing areas. New rules also propose changes in the shape and size of nets to prevent landings of small fish.

CASINOS

Israel has approved specially fitted planes that will give gamblers a four-hour flight. By leaving Israeli airspace, the planes will get around Israel's gambling ban. The service will start in 2003 and will be run by an airline from Iceland with three flights a day. The project is expected to generate about US$50-million a year in revenue for Israel.

READING

English research shows that newspapers have taken over from the novel as the most popular form of reading matter. On average, people devote 17 minutes a day to the press, compared with only 11 minutes reading fiction. Magazines follow closely attracting on average five minutes' reading time each day. Two minutes are spent on reference books. The study shows that people spend six hours a week reading compared with 23.5 hours a week watching television.

ORGANIC

A U.S. consumer group claims that nearly a quarter of organic fruits and vegetables contain pesticides. Organic crops are a small percentage of the North American market, less than five per cent, but the industry is growing rapidly. Sales of organic food are expected to grow by 20 to 30 per cent this year.

CUSTARD

A recent science festival was told that spraying ironing starch over a bowl of custard dramatically improves its flavour and texture. Also, non-perfumed starches makes sauces and purees richer without adding calories.

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

June 2002 Economic Digest - Importing and Exporting

June 2002 Edition

WATER

 
The volume of bottled water sold in the U.S. swelled to more than 5.4 billion gallons in 2001. This is an increase of 10.6 per cent over 2000. Wholesale dollars increased even more dramatically, advancing by 11.5 per cent to nearly US$6.5 billion in 2001. One year earlier, sales grew by 9.3 per cent, down from 13.9 per cent in 1999. In 1991, the U.S. absorbed the equivalent of 9.3 gallons for each resident. By 2001, per capita water consumption approached 20 gallons.

INFORMATION

A fraud expert wanted to find out just how long it takes for stolen credit card details to find their way around the world. He posted fake credit card data online and put links to the information in a few Internet chat rooms. Within 15 minutes, 74 people in 31 countries seeking credit card information had viewed the page. After one weekend, more than 1,600 potential thieves from 71 countries had viewed the page

MARKETS

The European Union is planning to open trade talks with its former colonies later this year. The aim of the negotiations, with 76 African, Caribbean and Pacific nations, is to bring the existing US$12.7 billion aid-and-trade pact in line with world trade rules. The European countries have for years allowed preferential trade terms for their former colonies. About 40 ACP countries are among the world's poorest and are expected to keep some barriers to protect their fledgling industries from global competition.

TEXTILES

China, the world's largest textile exporter, is aiming to become one of the strongest players in the industry. One group is planning to invest US$117 million in Thailand to build four factories. These will consist of a cotton yarn mill, a spinning mill, a household textile plant and a citric acid unit. Most of the output will be exported. Up to now, China's textile industry lagged behind those in Italy and France, leaders in production technology.

SPACE

U.S. businesses vacated 26.4 million square feet of office space in the first quarter. This so-called negative absorbtion, coupled with 13.5 million square feet of new development, pushed the national vacancy rate up to 14.7 per cent from 13.6 per cent at the end of 2001. The current vacancy rate is the highest since the end of 1994.

JAMMING

A priest in Spain has installed a jamming device in his church to counter the beeps, tunes and digital noise emitted by today's omnipresent cell phones. The device transmits a low-powered radio signal that severs communications between cellular handsets and cellular based systems. Commercial jamming systems are illegal in the U.S., Canada and Britain.

CHIPS

A fall in demand for semiconductors in the past year has left idle 30 per cent of Taiwan's silicon wafer-making capacity, representing about US$10 billion in investment. Meanwhile, China's market for chips is predicted to be worth around US$15 billion this year, growing to $41 billion by 2005. About 95 per cent of this demand has to be met with imports. Officials in Beijing are almost begging Taiwanese semiconductor manufacturers to set up in China.

MUSIC

Global sales of recorded music fell five per cent to US$33.7 billion in 2001 because of a sluggish world economy and increased consumer piracy. CD sales fell by four per cent to 2.4 billion units while sales of singles fell by 16 per cent. Sales in North America, the largest market, fell by 4.7 per cent to US$14 billion. Europe declined by 0.8 per cent while sales in Japan, the second-largest national market fell by 9.4 per cent. Two markets that bucked the downward trend were the U.K. and France.

VEHICLES

A total of 18.1 million road motor vehicles were registered in Canada in 2001. Of this total, 17.1 million, or 94%, were passenger cars and light vehicles such as pickup trucks and minivans. The remainder consisted of 74,000 buses, 318,300 motorcycles and mopeds, and almost 654,500 truck tractors and trucks (weighing at least 4,500 kilograms). In addition to these road motor vehicles, 4.0 million trailers and 1.3 million off road, construction and farm vehicles were also registered.

EDUCATION

Garbage trucks in the south Taiwan city of Tainan will soon broadcast English lessons from loudspeakers to educate citizens as they haul away the rubbish. The English-speaking trucks are scheduled to hit the streets later this year. Currently, Taiwan's garbage trucks call people out to the curb with their rubbish by playing classical music.

SENIORS

According to Statistics Canada, one out of every 13 seniors aged 65 and over was still at work according to the 1996 Census, a ratio that is likely to increase as the 9.8 million baby boomers in Canada get closer to retirement age. An estimated 255,200 seniors aged 65 and over were employed in 1996, and an additional 15,700 reported being unemployed, for a total labour force of 271,000. The majority (68 per cent) of people employed in this age group were men, even though they accounted for only 43 per cent of the population aged 65 and over.

CALIFORNIA

If California was an independent country, it would have the world's fifth-biggest economy, with a gross state product in 2000 of $1.3 trillion. Last year, 140 million tonnes were loaded on and off ships at Long Beach-Los Angeles, the largest port in the U.S., and a further 20 million tonnes at Oakland.

GLASS

Canadian greenhouse expansion has become a success story, and a full 18 square kilometres in Canada, most of it in southwestern Ontario, is now under some sort of cover. This is more than double the area in 1991. Since 1996, B.C.'s hothouse industry put another 1.7 million square metres of land under glass, enough to cover 210 football fields. This has been driven by demand for B.C. tomatoes, bell peppers and cucumbers.

FRUIT

Grapes, a relatively small commodity in terms of area, have made a large impact since the industry was transformed by the Canada United States FTA in 1988. Since 1996, grape area has increased 41 per cent, the largest relative increase in area of the top five fruits grown in Canada.

TREES

China is embarking on a US$10 billion, 10-year program to plant 170,000 square miles of trees, an area roughly the size of California. This is needed after decades of logging that has left large swatches of the country looking like a desert wasteland. Only a few per cent of the country's original forests still stand. One problem facing the government is finding enough trees even though China has a thriving tree-farming industry.

EXPORTERS

The top merchandise exporters in 2001 were, in US dollars: the United States, $725 billion; Germany, $560 billion; Japan, $400 billion; France, $300 billion and Britain, $275 billion. Canada was seventh, behind China with $260 billion.

BUMPS

The British government is to introduce new speed restrictions in poor neighbourhoods after research showed that children living there were five times more likely to be hit by a car than those in affluent areas. Drivers will be forced to slow down by road bumps, chicanes and other forms of speed reduction. Research also showed that introducing and enforcing a 20mph zone reduced the child casualty rate by 70 per cent.

ART

More than 60 major works of art worth over US$1.5 billion have been destroyed in Europe. The paintings were cut into pieces and then put through a sink disposal unit along with potato peelings. They were trashed by the mother of a major art thief who was angry that her son had been arrested.

CARROTS

Experts believe that Dutch breeders developed the orange carrot in the 16th century using a yellow mutant seed. As long ago as 2000BC, temple drawings in Egypt show carrots to be purple. In Roman times, they were purple or white. By the 10th century, purple carrots were grown in Afghanistan, Pakistan and Iran. Purple, white and yellow carrots were imported to southern Europe in the 14th century. Dutch breeders have recently studied the health qualities of purple carrots and believe they give extra protection against various forms of cancer and heart disease.

RAIL

Work has begun on a rail link between Alice Springs and Darwin in Australia's Northern Territory. The US$700 million project will establish an important new transport corridor serving both domestic and international markets. This project has been in the planning stage for more than a century. It will create a link between Asia and the southern markets of Australia. Each train will be 1.6 kilometres long and carry 250 double-stacked containers. Australia does about US$200 billion in trade with Asia annually

BORDERS

The economies of Alberta and B.C. are drifting further away from Saskatchewan and Manitoba, and forging stronger links with the U.S. Pacific Northwest. The Canada West Foundation released a study recently on how the four western provinces as a whole have fewer economic ties with Central and Atlantic Canada than in the past. Whether it's oil, lumber, natural gas, wheat, beef or hogs, the West's top customers are in the U.S.

SPENDING

According to CPG Online, consumer packaged goods (CPG) companies, which are among the world's leading advertisers in terms of both budgets and marketing expertise, account for a remarkably small portion of overall internet advertising. CPG companies spent US$12.4 billion across all measured media in 2000 and $11.9 billion in 2001. However, it is estimated that CPG companies spent just US$134 million on online advertising in 2000.

GOLD

In the first quarter of this year gold imports to Japan rose almost six-fold over a year earlier to some 41,000 kilos. People are walking into precious metals dealers with wads of cash and walking out with gold bars. Gold has become a safe haven for investors who are concerned about Japan's economy. Gold futures are doing brisk business and trading volumes so far this year are three times greater than last year.

TAXES

The U.S. is reported to be upset at the news that the European Union plans to introduce a new tax on products downloaded from the Internet--including software, videos and music. This is being done to help Europe's web-based business compete with the U.S. The U.S. giants of the industry levy no taxes from online customers which gives a tax loophole to European buyers who find cheaper-priced goods on U.S.-based sites.

ADDICTION

A man in England addicted to munching his way through 50 ballpoint pens a week has been cured through hypnotherapy. He began spending $100 a month on his habit after he was banned from using pens at work because none of his colleagues could find anything to write with. He has been chewing pens for about five years but it started to get worse when he was stressed.

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

May 2002 Economic Digest - Importing and Exporting

May 2002 Edition

RECOVERY

 
The World Bank is expecting recovery in the developing world to be led by East Asia, which is forecast to grow by 5.2 per cent in 2002 and by 6.9 per cent in 2003. By contrast, it expects Latin America and the Caribbean to grow by only 0.5 per cent this year. The Middle East and Africa will be the slowest-growing developing regions in 2003 and 2004.

SPAM

The company that manufactures the infamous luncheon meat expects to make their 6 billionth can of Spam in April. Worldwide, 3.1 cans of Spam are consumed every second. In the U.S., more Spam is eaten in Hawaii than in any other state, about 4.3 cans per resident per year. Other states with big Spam consumption are Alaska, Arkansas, Texas and Alabama. In England, Spam has a 2,000 member Spam fan club. The name Spam is registered in 111 countries.

AGE

The world's oldest known photograph--a French picture photographed in 1825--was recently sold to France's national library for US$625,000. The picture, a facsimile of a 17th century Flemish print, would have sold for more but the market was restricted by a French government order making it a national treasure which required it to stay in France.

TECHNOLOGY

The world's first talking washing machine is about to go on sale in India developed for the growing middle class who are no longer able to afford servants. Equipped with a vocabulary of more than 90 English and Hindi phrases, the Electrolux Kelvinator was developed after Indian customers said they wanted a washer that told them what to do. It uses simple phrases such as "Drop the detergent, close the lid and relax" and "Getting ready--please wait" accompanied by tinkling piano keys or a trumpet fanfare.

FILMS

Led by revenues from foreign movies, film distributors and videocassette wholesalers posted a record C$2.5 billion in total revenue in 1999/2000, easily eclipsing the C$2.3 billion mark reached in 1998/99. Revenue growth of 20.7 per cent in the pay television market and 14.0 per cent in the home video market contributed significantly to the record total. But with expenses growing faster than revenues, profits fell for the second year in a row, ( 17.6 per cent to C$271.5 million).

SELECTION

Scientists think they have figured out what goes on in the brain when a shopper browsing decides to buy something. The minds "shopping centre" --the part that becomes active when we select one brand of cola or ketchup over another--has been pinpointed in the right parietal cortex, a region of the brain just above and at the back of the right ear. In the not-too-distant-future, manufacturers of cereals, soft drinks and ketchup could be screening customers' brains to find out why one brand sells better than another.

EDUCATION

Among the Masai in Africa, the brightest children are sent off with the goats. School is for those less smart. The Masai contend that it takes brains to identify each animal, find water and ward off rustlers. Herders rely on their children's labour, so many feel that time spent with books is wasted. Barely one Masai in ten can read.

TRADE

Despite having signed a trade agreement with the U.S. in 2000, Vietnam's trade with China is growing faster than with any other country. Official trade has grown from US$955 million in 1998 to US$3 billion in 2001. In the north of the country, many Chinese goods are smuggled across the border into Vietnam including: knock-off clothes, complete with "Made in Italy" labels, cooking pots, suitcases, car parts, stationery, toys, mobile phones, plastic plants and even foods.

E-COMMERCE

Business-to-business transactions dominated U.S. electronic commerce in 2000 according to the Census Bureau. Such sales make up 94 per cent of e-commerce transactions. The manufacturing industry led all sectors surveyed with total e-commerce shipments of US$777 billion. Results came from surveys covering a total of 125,000 businesses in the manufacturing, wholesale, services and retail sectors.

WATER

The United Nations is warning that 2.7 billion people will face severe water shortages by the year 2025 if the world continues consuming water at the same rate. Another 2.5 billion people will live in areas where it will be difficult to find sufficient fresh water to meet their needs. The areas most at risk are in the semi-arid regions of sub-Saharan Africa and Asia. However, at least 120 million people living in Europe--one in seven of the population--still do not have access to clean water and sanitation.

LABELS

The U.S. Food and Drug Administration (FDA) has said that companies must do more testing before they label food as free of genetically engineered ingredients. Critics of biotechnology pressed the previous administration to label gene-altered ingredients as such, but the FDA instead has proposed the labelling rules for foods that are biotech free. The agency would likely allow genetically modified ingredients to make up no more than about one per cent of officially biotech-free foods.

CITIES

According to a recent Merrill Lynch of New York survey, Toronto and Calgary are the only healthy office markets in North America. And Montreal and Vancouver are two of only seven North American cities or markets that the financial management company considers to be stable. The study showed that the four Canadian cities are in far better shape than their U.S. counterparts. The study looked at 75 markets in 40 U.S. cities and four Canadian cities.

PRIVATIZATION

Two of Russia's top oil companies, a telecommunications giant and a major airline are among the hundreds of companies that the Russian government is planning to sell its stakes in this year. The privatization plan includes over 600 agricultural, defense, automobile enterprises, mass media companies and banks.

MEASUREMENTS

Britain's euro-sceptics are incensed that the European Union plans to produce a list of standard garment sizes for the 15-nation community--in metric. There are now various sizing systems in Europe.: a British size 12 equals a size 38 in Germany and the Netherlands, a C38 in Norway, Sweden and Finland, a 40 in Belgium, a 44 in Italy and a 44\46 in Portugal and Spain. In the U.S. this would be a 10. Under the new system 74 centimetres would mean just that from Athens to Zeebrugge. A draft standard will be available at the end of this year.

GROWTH

Scientists have managed to make chunks of fish grow by soaking them in a broth of nutrients. This suggests that meat could be manufactured. Chunks of goldfish muscle grew 14 per cent after a week immersed in a nutrient-enriched liquid extracted from the blood of unborn calves.

EMISSIONS

Sports Utility Vehicles (SUV's) in Canada are to be re-classified as cars in order to lower their emissions. SUV's have evaded the regulations that were put in place for passenger vehicles. By placing SUV's in the same category as cars, manufacturers will be forced to produce vehicles that conform to higher emission standards. New SUV's will emit one-twentieth of the pollution of current models.

CAMERAS

Digital camera penetration of U.S. Internet households reached 33 per cent in 2001. A new survey indicates that penetration could reach as high as 60 per cent by the end of 2002. Only 20 per cent of U.S. Internet-connected households have not considered purchasing a digital camera. 19 per cent of digital camera users say they no longer use film, up from 10 per cent of camera users in 2000.

TRENDS

Employment agencies in Britain have spotted a growing trend for companies to appeal to the vanity of employees by offering them fancy titles--while keeping their pay rates firmly down. The trend is so common it is now referred to as "uptitling." In a survey of 1,700 workers across the country it was found that many large companies have taken to uptitling in a bid to keep staff happy without handing out raises.

JAPAN

A key government panel in Japan has concluded that the country needs to pursue bilateral free-trade agreements to survive increased global competition. Japan has just signed its first FTA with Singapore. The pact removes tariffs on 94 per cent of Singapore's exports to Japan. Singapore in turn will scrap tariffs on goods imported from Japan. Japan is studying similar agreements with South Korea and Mexico.

MAKEOVER

In Britain, Mars bars are to be given a less macho image in a bid to make it more appealing to women. In a US$10 million dollar makeover, the biggest in 70 years, the snack will be given a fluffier filling and new packaging in a bid to boost sales.

DAYLIGHT

Pakistan has become the first South Asian country to observe daylight savings time. The country is now six hours ahead of GMT. The government says the move is an experiment and will save electricity by reducing the time people need lights in the evening.

INVESTMENT

The U.S. is still by far the largest direct investor in Canada, according to statistics Canada. And in turn, the U.S. was the primary destination for Canadian investment abroad. With investments of $215 billion in 2001, the U.S. accounted for 67 per cent of direct investment in Canada, up from 63 per cent in 2000. In contrast, Canadians made 51 per cent of their direct investments abroad--worth a total of $198 billion--in the U.S.

UNFAIR

Japan, the European Union and China came in for the heaviest criticism by the U.S. administration in a report spotlighting trade barriers against U.S. exporters. In all, the report cited 52 countries and three trading blocks. Canada is cited for provincial timber-cutting regimes and the Canadian Wheat Board's export monopoly. The report devotes much more space to Japan, followed by the 15-country European Union and China, which for the past two years has had the largest surplus of trade with the U.S.

LIFESTYLE

According to a book released by a U.S.-based environmental group, British Columbians live longer, consume less energy and live in better-managed cities than their counterparts elsewhere in the Pacific Northwest. Greater Vancouver is doing a better job of containing population sprawl than Seattle or Portland and residents can expect an extra two years to enjoy their surroundings. The study looks at 10 quality of life indicators ranging from health and population to energy consumption and salmon productivity.

WINNING

A Thai street hawker briefly became a winner by answering all 16 straight questions correctly in the Thai version of "Who Wants to be a Millionaire." Organizers apologised when it was learned that a technician had accidentally plugged the wrong cable into the contestant's computer monitor feeding her the correct answers.

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

April 2002 Economic Digest - Importing and Exporting

April 2002 Edition

RICE

 
In a dispute at the US Patent and Trademark Office (USPTO) between a Texas based company and the Indian government, India lost its battle against the US patenting of the world famous Basmati (fragrant earth) rice when the USPTO granted patents to three hybrid strains developed in the US. India provided evidence that not only the grain, but also the seeds and plants which produce the grain, have been bred and cultivated in India and Pakistan. The US company may now label its product as a "superior basmati rice".

HEALTH

The World Health Organization predicts that, by the year 2020, depression will be the second greatest cause of premature death and disability worldwide for all ages and both sexes. It currently affects about 121 million people.

CONSTRUCTION

In its continued battle with Quebec over worker access, Ontario is about to ban Quebec workers and companies from Ontario's construction and trucking industries. Ontario claims it is making no progress in negotiations with Quebec about restrictions on workers from Ontario working in Quebec. It is claimed that as many as 7,000 Quebec workers depend on construction jobs in Ottawa alone. Ironically, Toronto home builders are importing 500 skilled tradesmen from overseas because they can't attract enough workers in Canada. These tradespeople are coming from Ukraine, Russia, the Philippines and Chile under a pilot program with the federal government.

COMPENSATION

Last year, major U.S. corporate executives pocketed smaller pay packages than at any time since 1989. Salaries and bonuses of surveyed CEO's dropped a median of 2.9 per cent. That is largely because many companies slashed or omitted their leaders' bonuses which are often linked to profitability. Corporate profits sank a median of 13 per cent.

BAKING

For 53 years, the Pillsbury company has held an annual bake-off. This year's winner, an accountant who won US$1 million, was among 100 finalists. The winning dish? Chicken Florentine Panini...the first winning sandwich. It was made with refrigerated pizza crust, sauteed chicken breasts, spinach and garlic-flavoured mayonnaise.

PROFIT

In 1999, Canadian government business enterprises earned profits of $15.5 billion, $1.5 billion more than in 1998. This was on total revenues of $99 billion. Provincial and territorial government business enterprises posted profits of $10.1 billion on revenues of $66 billion, accounting for more than 65% of all government enterprise profits in 1999. Federal enterprises earned $5 billion and local government enterprises, $0.4 billion. Provincial and territorial lotteries, gaming, and liquor enterprises generated after tax profits of slightly more than $8 billion in 1999, which is approximately 1.5 times the profits of all chartered banks in Canada in that year.

POULTRY

Russia has stopped issuing import licences for U.S. poultry and has placed a temporary ban on poultry imports. This is a move to pressure U.S. producers to divulge what antibiotics, preservatives and other substances are used. U.S producers sent Russia about 1 million tons of poultry, mostly chicken and turkey, worth about US$700 million annually. Russia produced only 564,000 tons of poultry last year.

PROGRESS

The Doomsday Book is the earliest public record of England. Commissioned by William the Conqueror, it details the land holdings and resources of England twenty years after the Norman conquest. Sixteen years ago, in a $5.6 million project to showcase England's electronic prowess, a computer-based multimedia version of the Doomsday Book was developed. Now, the special computers developed to play the 12-inch videodiscs of text, photographs, maps and archival footage of British life are obsolete and unreadable. Meanwhile, the original, nine-hundred year old Doomsday Book is still in fine condition and readable at the Public Records Office.

DIAMONDS

Every day of the year, 328,000 carats of diamonds are mined, many controlled by De Beers who spend US$200 million a year on advertising. The company's millennium advertising campaign increased sales in the first half of the year 2000 by 44 per cent from the previous year. Sales went from US$2.4 billion to US$3.5 billion. De Beers sells US$500 million worth of diamonds every five weeks.

HEATING

For three weeks in February, the heating on the campus of the University of Georgia, and all its hot water, was generated by burning 300,000 gallons of chicken fat and yellow restaurant grease. The experiment, which required the retrofit of one of the campus's steam boilers, worked well burning very cleanly with very low sulphur. Nationally, about 11 billion pounds of waste fat are produced each year in the U.S.

CELLPHONES

For the first time, worldwide sales of new cellphones dipped last year as wireless carriers reduced subsidies for new phones and many consumers held off on upgrades. The decline was 3.2 per cent, from 413 million handsets in 2000 to 400 million in 2001. This is a sharp break from the growth rates between 1996 and 2000, when each year saw a sales increase of 60 per cent.

AID

Canada is contributing C$1.3 million to the World Trade Organization (WTO) for trade-related technical assistance for developing countries. The aim of the assistance is to help those countries that decide to join the WTO but do not have the expertise or resources that would help them reap the full benefits of membership.

RAGE

A new study funded by Hewlett-Packard (Canada) states that photocopiers are a hotbed of stress and anxiety for Canadian workers. Some people are driven to fits of violence by copiers that don't cooperate. The poll found that 12 per cent of Canadians that have used a copier at work have become so frustrated that they have actually kicked or hit it. Another three in 10 said they seriously wished to do so but retrained themselves. People with a university education are the most likely to attack a copier.

WATER

A government analysis shows U.S. waterways are awash in traces of chemicals used in beauty aids, medications, cleaners and foods. Among the substances: caffeine, contraceptives, pain killers, insect repellent, perfumes and nicotine. Scientists say that the problem is that these substances largely escape regulation and defy municipal wastewater treatment. Hydrologists with the U.S. Geological Survey tested water samples in 30 states for 95 common compounds, an emerging class of contaminants known as pharmaceutical and personal care pollutants.

COSTS

On an annual basis, U.S. productivity continued to grow more quickly than did Canada's in 2001. However, Canada maintained an advantage in unit labour costs. In 2001, labour productivity grew 1.2 per cent in Canada and 1.9 per cent in the U. S. This 0.7 per cent difference in favour of American businesses is in line with the average 0.9 per cent gap per year measured since 1995. Despite Canada's softer productivity performance, lower growth in compensation paid by Canadian businesses more than offset this productivity gap.

ATMs

The Canadian Office of Consumer Affairs is warning Canadians about the spread of no-name automated teller machines that can cost users up to $3.00 per transaction. About 13,000 so-called "white label" ATMs--generic machines not operated by Canada's big banks--have sprung up across Canada in the past six years and now make up more than one third of the country's 35,000 banking machines. A recent poll suggests that 35 per cent of Canadians each month withdraw cash from no-name ATMs.

THE DOLLAR

The leading U.S. manufacturers' trade group is calling for a change in U.S. foreign exchange policy which it says undermines U.S. exports. The group claims that the dollar's 30 per cent rise since 1997 amounts to a 30 per cent tariff on U.S. exports of manufactured goods and a consequent loss of manufacturing jobs. The export of U.S. manufactured goods has dropped 20 per cent over the past two years and is expected to drop a further 7 per cent in 2002.

SOFTWARE

India's software exports are likely to grow by over 30 per cent this year and are expected to be worth over US$7.6 billion. This compares with US$6.2 during 2000-01. The number of persons working in the IT industry nearly doubled to 430,000 in 2000-01 over 220,000 in the sector in 1998-99.

LEEKS

The Welsh are upset that the European Union is interfering with one of the national symbols of Wales, the common garden leek. The EU intends that Welsh leeks should conform to international standards. There will be two classes of leeks. Leeks in class one must be of good quality with the white to greenish part of the leek representing at least one third of the total length. Size will be determined by their diameter measured at right angles to the longitudinal axis above the swelling at the neck. The minimum diameter is fixed at 8mm for early leeks and 10mm for other leeks!

TAXES

Tiger Woods paid more tax than anyone last year in the southern Chinese city of Shenzhen--after just one weekend of work. Woods was paid US$2 million for two exhibition rounds and paid US$777,000 in taxes. China's per capita net income for urban households was US$1,218. Golf enthusiasts from Hong Kong reportedly paid as much as US$18,000 to play a hole against him.

PLASTIC BAGS

The Irish government has begun collecting a 13 cent environmental tax on plastic bags used in supermarkets, convenience stores and other shops. The tax is intended to encourage shoppers to use tougher reusable bags and cut down on the use of throwaway bags. The government hopes the new charge will raise $160 million annually to be used on Ireland's deteriorating environment.

DESERTIFICATION

According to the Institute of Desert Research, land degradation in China costs the nation US$6.7 billion a year and affects the lives of 400 million people. Current estimates say that 950 square miles of land becomes desert every year a 58 per cent increase since the 1950s much of it land that formally supported crops and livestock. In a nation of over one billion people, all of whom have adequate amounts of food but many of whom need better nutrition, such enormous losses are potentially devastating.

TRENDS

Some restaurants in Britain are forcing customers who like their meat rare to sign a disclaimer form before eating due to fears of the risk of E-coli and salmonella poisoning. The restaurants are prepared to serve rare hamburgers, sausages or minced beef only if diners complete forms giving up rights to take legal action.

TRIVIA

A motorist in Hong Kong sued a would-be suicide who jumped out of a window and landed on his car. The women who jumped argued however, that she should not pay as his car was illegally parked.

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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March 2002 Economic Digest - Importing and Exporting

March 2002 Edition

DENMARK

 
The recently elected Danish government has indicated that it is ready to lift its ban on beer and soft drinks sold in cans. In a court case initiated by the EC, Denmark faced charges for breach of the EU's packaging directives. Currently, Denmark allows beer and soft drinks in recyclable bottles. Some speculate that the removal of the ban will make it easier for foreign brewers to enter the Danish beer market, where the Carlsberg brewery currently holds a 70 percent market share.

SAFETY

European Union farm ministers officially passed laws to set up a new European Food Safety Authority. It is designed to bolster declining public confidence in food safety in the wake of alerts such as mad cow disease and dioxin poisoning. The body will employ up to 250 people with a budget of 40 million euros and will provide scientific advice to policy makers and give the public information on potential risks in the food chain.

EMPLOYMENT

Nearly one Canadian worker out of six was self employed in 2000, and most of these individuals became and remained self employed by choice, according to the first results from the Survey of Self employment. According to the survey, nearly 2.3 million individuals were self employed in December 2001. For almost 80 per cent of individuals, the transition to self employment was made voluntarily, The remainder, slightly more than 20 per cent, reported that they became self employed because of a lack of suitable paid employment opportunities.

SMALL

Researchers in Japan have created a thermometer 10 times shorter than the width of a human hair. The "nanothermometer" is the latest application for carbon nanotubes, structures built from a honeycomb pattern of carbon atoms and wrapped into a tube shape that's only 75 billionths of a meter in diameter.

BUILDING

Canadian builders took out an estimated $39.9 billion in building permits in 2001, just shy of the all time high set in 1989. Construction intentions for housing broke an annual record, and non residential permits hit a 12 year peak. The $39.9 billion annual total is an 8.1% increase from 2000, and just short of the best annual performance on record, $40.0 billion. Advances in both the residential and non residential sectors contributed to this strong showing.

ROADKILL

A space-age camera system is to be used on the roads of British Columbia to make them safer for wildlife. A prototype infrared camera is to be installed which will take continuous live video pictures of a stretch of road several kilometres long. The camera can see 25 metres on either side of the road. Before a bear, deer, moose or sheep decides to try its luck against the traffic, the camera will relay the animal's image to a computer that will convey information about the animal to a brightly lit digital sign posted on the highway. Wildlife accidents cost around $19 million in accident costs and highway cleanup costs.

WATER

The Great Lakes are at their lowest point in 35 years and water levels may drop even more because of the warm winter. Without the usual ice cover, millions of gallons of water are evaporating from the lakes. Last year, cargo ships were forced to lighten their loads and many boat ramps became inaccessible as water levels on the Great Lakes fell to their lowest point since 1966. For every inch of water that Lake Michigan loses, a cargo ship must reduce its load by 90 to 115 metric tons which mean losses of between US$22,000 and US$28,000.

LABELS

The US has sharply criticised the European Commission's proposals for labelling and traceability of genetically modified (GM) products which US officials say could cost US companies up to US$ 4 billion a year in export earnings. US officials have described the proposed rules as "trade disruptive and discriminatory". For instance, the regulations would require soybean oil to be labelled as a GM product, while European cheeses and wine made with biotechnology enzymes would not be covered.

CHINA

A study by the U.S. Conference Board concludes that the productivity of state-owned companies in China still lags that of private and foreign-owned Chinese companies by a wide margin. Among Chinese companies with some state ownership, those under local rather than state administration, are noticeably more efficient. However, the study which surveyed 23,000 companies operating in China, reports that as foreign companies venture deeper into the Chinese domestic economy, the advantages they enjoy will dissipate.

CONVENIENCE

The U.S. convenience store industry grew four per cent in 2001, increasing to a record 124,516 stores. This follows a 0.3 per cent increase in 2000 and a 5 per cent increase in 1999. 10 years ago the official industry store count stood at 103,400 and 20 years ago there were 71,400 stores. Overall, 14,385 convenience stores opened in 2001 offsetting the 9,000 stores that closed.

COLLECTIBLES

According to TIAS.com, a leading U.S. online catalogue of antiques and collectibles, the hottest items to collect in 2001 included china, cookie jars, furniture, lamps, books plates, Depression glass and Roseville pottery.

SECURITY

Many businesses that depend on the Internet have a false sense of security about the reliability of their computer systems and their ability to avert trouble, according to an Ernst & Young study. A sampling of 80 large Canadian companies found that computer system failure was sited as one of the biggest risks businesses face. 34 per cent of companies surveyed said it was their biggest risk. However, about one-quarter didn't have a business continuity plan or a computer disaster recovery plan while 41 per cent didn't have an overall management plan for any serious crisis.

BABIES

For the first time since 1971, women in the U.S. are bearing enough children to offset deaths. 4,058,814 births were reported in 2000, up 2.5 per cent from 1999. It was the first time since 1993 that births topped four million. Researchers believe that the roaring economy of the 1990s probably fed the baby craze with parents more comfortable about supporting a family. Teen births dropped 22 per cent in the decade.

CONTAINERS

A Richmond, B.C. company has developed a weapon to counter theft from shipping containers and trucks which costs the insurance industry US$10 billion annually in North America. Now being distributed throughout Canada and the U.S., the system has the backing of a major U.S. insurance broker and a Canadian company that manufacturers satellite tracking equipment. If a container is tampered with, the driver is alerted by pager within 10 seconds. Through GPS, the location of a container can be located to within 30 metres anywhere in North America.

SPORTS FISHING

Some scientists are warning that Canada's sports fishery, worth between $4.4 billion and $7 billion, is collapsing so rapidly it may soon suffer the same fate as the commercial cod and salmon fisheries on the East and West coasts. Virtually all sports fishery stocks are depressed. The situation is worst in the provinces of Alberta, B.C. and Ontario.

COLOUR

Nineteen per cent of North American new-car buyers purchased silver vehicles last year. Silver replaced white as the most popular colour. 16 per cent were white, 15 per cent were red, 11 per cent were blue and 10 per cent were green. Green was the most popular colour between 1994 and 1998 when more than one in five owners chose that colour.

TASTE

Italy's highway robbers have been preying on trucks delivering an unusual luxury product: dried cod. Their passion for the flaky white substance has turned the roads of southern Italy into a no-go area for Norwegian fish trucks, putting at risk trade worth US$180 million a year. Thefts of Arctic cod are so frequent that insurance companies have with- drawn their coverage for trucks hauling cod to Italy.

CANOLA

China's new restrictive regulations against genetically modified crops require all modified crops to be approved by the Chinese Ministry of Agriculture. This may leave Canadian canola farmers without one of their most significant customers next year. The new regulations have caused major problems for U.S. soybean farmers who sell US$1 billion worth of their crop to China--70 per cent of which contains genetically modified organisms. 60 per cent of Canada's canola crop is genetically modified and exports are worth C$2 billion. Some suggest that this is just a non-tariff barrier.

NEW

Food manufacturers are churning out a record number of new products to satisfy every craving imaginable. Roughly 32,000 packaged goods were launched last year in Canada and the U.S., more than half--16,977--were foods or beverages. The number of new food products keeps expanding each year. Last year's total was 23 per cent higher than in 1997 when 13,840 new foods and beverages were introduced.

TRENDS

When fluoride was added to the water supply, the incidence of dental cavities declined. But since so many people began drinking--and giving their children--bottled water, there has been a resurgence of cavities

E-BUSINESS

A study by the E-Commerce Times says that more than 600 million people worldwide will have access to the Web by the end of the year, and they will spend more than $1 trillion shopping online. The study also finds that e-commerce grew to $600 billion in 2001, a 68 per cent increase over 2000. Business-to-business (B2B) makes up by far the largest share of Web sales and is expected to account for 83 per cent of online sales in 2002 and 88 per cent in 2006.

SPRAWL

The world's airports are getting to be as large as cities. Stockholm covers 140 square kilometres; Denver International Airport covers 138 sq.km. Kuala Lumpur International Airport spreads out over 101 sq.km. and the city of Miami 94 sq.km.

DRUGS

Spending on direct-to-consumer drug advertising in the U.S. has more than tripled between 1996 and 2000 as manufacturers of prescription drugs increasingly aimed their sales pitches past doctors to potential consumers. Drug makers spent US$2.5 billion in 2000 to promote their drugs to U.S. consumers, up from US$791 million in 1996.

POWER

A company in Israel has developed a battery that can be printed directly onto paper, plastic or other flexible material. The battery produces electrical energy much like ordinary alkaline batteries. Two electrodes, or terminals, separate an electrolyte--a chemical compound that generates negative ions. Connecting the battery's two terminals--say, with a light bulb or a motor--completes the circuit, allowing the electricity to flow and power whatever is attached.

TRIVIA

Canada produced six billion bottles of beer last year resulting in annual revenue, including taxes, of C$11 billion.

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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February 2002 Economic Digest - Importing and Exporting

February 2002 Edition

 
CYBERSHOPPING

Canadian on-line shoppers dramatically boosted their spending on websites during the holiday season contradicting experts' predictions. Shoppers spent an estimated C$1.16-billion for on-line gifts in late 2001, a 78 per cent surge from the estimated C$680-million they spent a year earlier. They spent an average of C$324 on on-line gifts, compared with C$228 in 2000 and C$141 in 1999. Studies found that shopping Internet sites enjoyed 25.6 per cent more "unique visitors" and 11.2 per cent more "minutes spent per unique visitor" in December from that month a year previously.

WHALES

A Japanese city is planning to farm whales in a bay 620 miles south-west of Tokyo, to entertain tourists, study breeding behaviour and ultimately, to supply restaurants with meat. The idea, which appals conservationists, involves trapping whales in the open sea and bringing them into a netted area of nearly two miles. Japan has been killing whales in the Antarctic for years despite the global ban on whaling.

ALTERNATIVE HEALTH CARE

In 1998/99, an estimated 3.8 million Canadians, about 17 per cent of the population aged 18 or older, reported having sought the care of alternative health care practitioners in the previous year. Alternative practitioners include chiropractors, massage therapists, acupuncturists, homeopaths and naturopaths. Women were more likely than men to consult an alternative practitioner. In 1998/99, about 2.2 million women aged 18 or older, or about 19 per cent of the female population of this age group, sought their services. The corresponding figures for men were 1.6 million, or about 14 per cent of the male population in this age range.

MERGERS

Worldwide mergers and acquisitions fell to $1.9 trillion, measured by deal value, in 2001, down by 45 per cent from 2000, as a slowing global economy cooled demand for new deals.

HEMP

Its Canadian makers tout the substance as an excellent source of vitamin E, protein and fatty acids that can be added to everything from pretzels to ice cream. The U.S. drug enforcement authorities say it's part of a family of dangerous hallucinogens. A Canadian firm, North America's largest producer of hemp seed, is to file a US$20-million-plus NAFTA lawsuit against the U.S. government arguing that a ban would destroy its growing business in the U.S. A rare private lawsuit, which under Chapter 11 of the NAFTA allows investors to sue governments directly, is just one of a handful of cases filed against the U.S. government by a Canadian company.

AFGHANISTAN

The fledgling government of Afghanistan is likely to receive nearly US$221- million in funds frozen in the U.S. once U.N. sanctions against the country are lifted. In addition, the Montreal-based International Air Transport Association has some $24-million for overflight fees that were withheld while the Taliban were in power. The monies in the U.S. include $196-million in gold reserves and $25- million in cash held by a variety of financial institutions.

CARS

Queen Elizabeth is to become the first British monarch to break with a tradition that Rolls Royce supplies the official royal limousine. Bentley, owned by Germany's Volkswagen, will give her a custom made model as a golden jubilee gift this year. BMW, owners of the Rolls Royce marque, are said not to be amused.

DUMPING

Japan and the European Union plan to ask the World Trade Organization to allow them to enact a law, similar to 1916 U.S. antidumping law, that enables American firms to claim damages from foreign firms accused of dumping in the U.S. market. This is unusual as, in the past, both Japan and the EU have filed separate complaints against the 1916 U.S. antidumping law. Two WTO dispute settlement panels have ruled against the U.S.

WEIGHT

After a long history of famine, the Chinese now have an emerging problem with obesity. Health officials recently released a national health survey which said that more than 10 per cent of boys, and five per cent of girls aged 7 to 18 were obese, roughly double the figures from 1995. Another study released last year said 30 million Chinese over age 20 were overweight. Besides children being spoiled as a result of the one-child policy during the Cultural Revolution, China's consumerism boom is creating a fast-food culture that mirrors that of the West.

FREE TRADE

Japan and Singapore have signed a free trade pact, the first of its kind for Japan, that is expected to remove tariffs on almost all goods traded between the two countries.The agreement eliminates tariffs on goods covering 98.5 per cent of trade between the countries. The pact also provides for cooperation in science and technology, financial services, education, tourism and training. Japan has stated that this will provide a model for Japan's economic relations with Asia.

LOANS

Eighty two percent of small and medium sized enterprises that sought a loan or other type of credit during 2000, were able to obtain it, according to a Statcan survey of 11,000 companies. Larger firms were more likely to have been accepted for financing than were smaller firms. Businesses in knowledge based industries had a lower authorization rate for debt financing. About 70 per cent of these companies were successful in obtaining financing, compared with 93 per cent of companies in agriculture and 88 per cent in the primary sector, which includes companies in forestry and mining.

TOOTHBRUSHES

According to designers, toothbrushes are now in the vanguard of consumer product design, becoming to teeth what athletic shoes have been to feet. The Industrial Designers Institute of America claims there's more design in a toothbrush today than in the first space shuttle.

PAINTING

A British firm has won a 15-month contract to repaint the Eiffel Tower after convincing the French that it is a European company. The Tower is repainted every seven years. 70 tons of paint will be required for the 1,000 foot tall tower.

POTATOES

Canadian Geographic reports that the most popular item on the Canadian menu is fries. 85 per cent of all potatoes grown in North America end up as fries and Canadians eat their own weight in potatoes each year. Canada grows some $600-million worth annually, making potatoes Canada's most valuable vegetable crop.

PETS

The market for pet food continues to grow, thanks to more pet ownership and greater use of premium foods. The top seven firms account for 60 per cent of worldwide dog- and cat-food sales and have combined sales of nearly US$19-billion annually.

VALUE

American consumers believe food offers the best bang for their buck, according to a new survey. Nearly half of those surveyed (48 per cent) say "food offers the best value" outranking clothing (15 per cent), home electronics (10 per cent), home furnishings (nine per cent), automobiles (eight per cent) and non-prescription drugs (seven per cent) for offering the best price, convenience, quality, customer service and choice. The food industry outranks even the federal government in terms of favourability.

FEES

The federal government is dropping fees it charges out-of-country individual performers and small groups visiting Canada. The change takes place in June. Previously, a non-Canadian solo artist with a valid work permit had to pay $150 each time he or she entered the country to perform. Ensembles with 15 members or more never had to pay the fees.

GLOBALIZATION

Canada has jumped three notches to place seventh in a prestigious ranking of the world's most global nations, outscoring the United States and key European rivals. The leader in the 2002 tables was Ireland moving up from sixth place to replace Singapore.

CULTURE

A recent Japanese government survey has revealed that the country's men perform household tasks in only one per cent of homes. This alarming statistic has prompted Tokyo to offer middle-aged men a beginner's guide to such household basics as peeling an apple, making rice, turning on the washing machine and using a duster. However, the program will stop teaching them how to hang out washing or air the futon on the tiny apartment balconies because it recognizes that being spotted by a neighbour would be considered a loss of face.

FRIDGES

Scientists claim to have created the world's first magnetic refrigerator, which someday may save consumers on energy bills and be better for the environment. Researchers have worked for years to develop magnetic refrigeration as an alternative to traditional cooling systems, which emit gases that contribute to global warming. The new refrigerator uses a special metal that heats up when exposed to a magnetic field then cools when the magnetic field is removed.

NUTRACEUTICALS

Baby boomers, who are concerned with their health, are fuelling a sharp rise in demand for functional foods or "nutraceuticals." 204 new nutraceutical products have been launched in major markets in the past 18 months. The biggest single category comprised "probiotic" products that contain beneficial bacteria. It is predicted that vitamin supplements will start to decline in significance as consumers turn increasingly to products that promise cures and prevention of specific ailments

CHARITY

The Vancouver Foundation reports that with $90-billion in annual revenues and $109-billion in assets across Canada, the non-profit sector is comparable in size to the economy of B.C. It accounts for more than 12 per cent of national gross domestic product and employs 1.3 million people. In the face of ongoing government cutbacks, the philanthropic sector will only become more vital to the economic and social wellbeing of the province.

SAUCE

How many lumps are allowed in a sauce before it becomes a vegetable? The question, to be considered by the EU, could affect millions of dollars of trade. While the EU tariff on imported sauce is only 20 per cent, the tariff on an imported vegetable is 228 per cent. Protectionists in the EU fear that vegetables may sneak into Europe disguised as tinned sauces. They argue that if a sauce is more than 20 per cent made up of lumps of fruit or vegetables, it should be considered a vegetable. Most of the multinational companies have shifted production to within the EU to avoid the tariffs.

BUILDING

December 2001 saw Canadian builders have their best month and their best year since 1992. Industry experts expect the momentum to continue in 2002.

FORGERY

Irish counterfeiters have failed in one of their first attempts to cash in on the euro by missing out the "o" on a forged one-euro coin. In addition to the spelling error, the coin also had a smooth, not a serrated edge. It was also faded as if the coin may have been in circulation for 30 or 40 years.

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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January 2002 Economic Digest - Importing and Exporting

January 2002 Edition

 JOBS

According to the government, at least one Canadian job in three depends on exports and over 85 per cent of our exports go to our partners in the North American Free Trade Agreement. This is one of the reasons that Canada's unemployment, at 6.9 per cent, is the lowest for 25 years. Free trade is critically important for Canada. We earn nearly half our wealth from international trade-related activity (46 per cent of GDP, up from around 25 per cent before the Canada-U.S. Free Trade Agreement and NAFTA).

FARMERS

China has 328 million farmers. With WTO entry, China's average tariff on agricultural imports will fall to 15 per cent from 22 per cent. Lower tariffs and a relaxation of state quotas and other controls are expected to bring a surge of food imports that will throw 13 million farmers out of work. China's agricultural output was US$300 billion in 2000, roughly as big as South Korea's economy. But public investment in infrastructure and production-related subsidies was just US$14 billion, far less that the 10 per cent allowed by WTO rules.

TRAVEL AGENTS

The Canadian travel arrangement industry, which comprises travel agents and tour operator services, grew 6.0 per cent in 1999 to $6.5 billion. The revenue generated by the travel agents in 1999 fell 2.8 per cent to $1.7 billion, the result of cuts in the commission rate paid by suppliers of travel services, such as airlines. The tour operators industry grew 10.0 per cent in 1999 to $4.7 billion.

CHARITY

Total charitable donations by Canadians in 2000 grew four times as fast as the number of donors. Donations totalled $5.4 billion in 2000, up 9.2 per cent from 1999 after adjustment for inflation. The results for 2000 maintained the upward trend seen since 1991. After declining slightly in 1999, the number of people reporting charitable donations rose from 5.4 million to 5.5 million in 2000, up 2.3 per cent. As in 1999, Manitoba had the highest percentage of taxfilers declaring charitable donations in 2000. At 29 donors per 100 taxfilers, Manitoba ranked just ahead of Ontario (28) and Saskatchewan (27). The national average remained steady at 26 donors per 100 taxfilers.

BEETLES

Billions of dollars of British Columbia's forests are being ravaged by the mountain pine beetle and billions more are at risk of exposure to the voracious insect. Over the past year, the beetle has expanded its range by 75 per cent to encompass about ten per cent of the provincial land base. Last summer, mountain pine beetles had infected 41 million cubic metres of Interior lumber, equal to almost two-thirds of B.C.'s annual timber harvest. Total value of infected timber is estimated to be C$18 billion.

RENTALS

The vacancy rate for rental housing has tightened across Canada to 1.1 per cent last month from 1.6 per cent the previous month. This is the lowest level since rental statistics were first measured in 1987. The lowest rates were in Victoria, Montreal and Ottawa.

CORRECTNESS

The city council in Liverpool, England, has changed the job title of street sweepers to "street scene operatives." An official explained they do more than merely sweep streets: they also cut grass, tend shrubbery and look after street signs.

FRANCE

Hundreds of French bakers have marched through Paris to oppose the national 35-hour working week which they say will threaten their livelihoods and the quality of their traditional baguettes, croissants and pastries. In a bid to create jobs, France has passed legislation reducing the work week to 35 hours. France has around 33,000 artisan bakers, 115,000 bakery workers and 30,000 bakers' partners. They produce approximately 72 per cent of the country's bread and sales are valued at US$7 billion.

ORGANIC

An increasing number of Latin American farmers are producing organic crops, using traditional and natural methods that do not require agro-chemical inputs. Total yields remain limited, but producers have their eye on markets in Western Europe and the U.S. where consumers are prepared to pay extra for organic products. Organic Chilean wine, Mexican coffee and Venezuelan cocoa are just some of the region's initiatives.

CHANGE

A surplus of coins compounded by Americans emptying their change jars in the softening economy has forced the U.S. Mint to begin layoffs. Mint officials now believe they will need only 15 billion new pennies, nickels dimes and quarters this year instead of 23 billion. The mint had already made too many coins during the previous year. Tens of millions of dollars worth of coins are unexpectedly back in circulation after months or years on dresser tops and in shoe boxes.

IT

A recent survey indicates that Canadian Information Technology (IT) spending will see negligible growth this year, rising to C$27.9 billion from C$27.1 billion last year. Modest gains are expected in 2003. The slowdown in Canada mirrors that in the rest of the world. Worldwide spending is expected to have declined by 9 per cent in 2001 and will fall still further in 2001. Software and services remain the long-term bright spots.

FREE TRADE

Canada has launched free trade negotiations with El Salvador, Guatemala, Honduras and Nicaragua aimed at further enhancing Canada's trade relationship with Central America. In 2000, bilateral trade between Canada and these four countries totalled C$617 million. Canadian direct investment in the area is estimated to be C$160 million. Potential exists for Canadian companies in several priority export sectors including telecommunications and environmental equipment and services, processed foods, automotive parts and construction

DIPLOMATS

The diplomatic service is a powerful economic force in Britain. Official statistics estimate that last year overall expenditure by envoys and their families amounted to US$1.5 billion and billions more is spent on goods and services. About 18,000 Britons are directly employed by foreign embassies.

POLLUTION

According to the Commission for Environmental Co-operation, utilities in North America want to build more than 2,000 electricity generating stations, most of them fossil-fuel fired, by 2007. The NAFTA pollution watchdog says that could cause carbon dioxide emissions from power generation in the U.S. to rise 14 to 38 per cent. It added that Mexican emissions of greenhouse gases would likely rise 48 to 76 per cent, and Canadian emissions from 5 to 16 per cent.

MILK

A new report says Canadians are paying $1 billion a year more than Americans for milk products. The Fraser Institute, a Vancouver policy think tank, says Canadians pay between nine and 36 cents more for a litre of whole milk than Americans. The author of the report claims that milk boards boost domestic prices and that Canada's supply management system distorts prices.

AGE

The Chicago Tribune reports that the average car in the U.S. is eight years old, up from 6.5 in 1990. The number of vehicles that are 11 years or older has been growing steadily since 1992 and is now more than 83 million out of 213 million cars on the road in 2000.

TOURS

A Dutch company is offering an adventure holiday package called Live Like a Tramp in London. For $680.00, it will fly tourists to that city and leave them to fend for themselves on the streets. Each person will get a sleeping bag and either a musical instrument or a sketching pad and pencil to earn survival cash. On the last night, those still in the streets will get a meal and a room in a good hotel. British homeless charities are outraged and the police say they will enforce the Vagrancy Act.

FAT

For the fourth consecutive year, American sales of low-fat products are falling. Five years ago, nearly one in three new food products made a low-fat claim. Today, only one in 10 so much as mentions low fat.

GM

Researchers have been baffled as an ancient variety of corn maize has tested positive for modified organisms in an area where no engineered crops are grown. DNA from genetically modified corn has been found in native corn plants growing in remote southern Mexico. The growing of GM crops has been banned in Mexico since 1998 and none was grown closer than 60 miles to the contaminated maize. Corn pollen is heavy and does not travel far on the wind.

TRADE FAIRS

Germany is a leader in implementing global trade fairs. It hosts two thirds of the world's leading fairs and is home to 6 of the world's 10 largest trade fair companies. In 1999 there were a total of 161,000 exhibitors and more than ten million visitors at German shows. Of 77,000 foreign exhibitors, almost 25,000 came from non-European countries. Some 1.8 million of the visitors came from abroad, including 300,000 from outside Europe.

PLENTY

A combination of bumper harvests and high support prices has landed the Food Corp. of India with a growing mountain of grain. It is also forcing the government to review its policy on agricultural subsidies. At hundreds of state-run depots across the country, India's public stock of food is at an all-time high and next spring it will grow still further to 80 million tonnes, four times the amount necessary in an emergency. Storage costs alone are $2 billion a year.

VIETNAM

The U.S. has signed a trade agreement with Vietnam, the last step in normalizing ties between the two countries. Vietnamese goods and services will gain access to the world's largest market with the same low tariffs enjoyed by most nations. In return, Vietnam must open its state-controlled markets to foreign competition and international standards. It's estimated that Vietnam's exports could double from the current $800 million a year.

DUMPING

Canada and the U.S. led the list of countries that launched investigations into the alleged dumping of goods in their markets in the first half of 2001. The U.S. launched 39 investigations, up nine from in the same period last year, while Canada started 23 investigations. A total of 18 WTO countries started 134 anti-dumping investigations against imports from 41 countries in the first half of the year.

TRENDS

The traditional dining room is disappearing from British homes. Eight out of ten homeowners in London no longer have a separate dining room. Nearly 70 per cent said they had converted it to another use during the past two years. People are putting them to use as offices, playrooms or bedrooms. Fewer family meals and more pressure on space have left homeowners reluctant to set aside a room for formal eating.

TRIVIA

British record company Charrm is releasing a single, in a limited edition of 500 copies, of the one-minute silence in Hyde Park after Princess Diana's funeral in 1997.

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