Saturday, February 27, 2010
Friday, February 26, 2010
Cavernous trade deficits and high unemployment are an unhappy combination, for governments and for open trade. When unemployment rates are high, as they are now - around 10 percent in the United States, and higher in some parts of Europe - politicians wishing not to join the ranks of the jobless find it harder to argue that what domestic demand there is should support jobs elsewhere. Thus, when times are good, deep trade deficits - and their inevitable counterpart, large surpluses in other countries - tend to be the subject of largely ignored warnings about global imbalances. But during recessions, they become politically explosive.
During the early 1980s, trade tensions pitted the United States against Japan and Germany, both of which were running substantial trade surpluses with the US. Today, it is the US and China, a relatively new export powerhouse, that have come to epitomise global financial imbalances (though they are hardly the only countries with significant surpluses or deficits).
A country’s balance of trade depends on a wide range of factors, such as domestic savings and investment. But in times of crisis, countries with deficits seeking a quick fix for imbalances often single out exchange rates as the main culprit. Key surplus countries’ currencies are too weak, they argue, making their exports unfairly cheap and imports unduly expensive.
In the first half of the 1980s, Washington pushed for the revaluation of the yen and the deutsche mark. Today, it is the Chinese renminbi that stands accused of being artificially weak.
Part of the contention over China’s exchange rate arises from the fact that its currency has been effectively re-pegged to the dollar since July 2008, making it the only major economy without a floating exchange rate. Read more here.
Canada's current account deficit narrowed in the fourth quarter of 2009 as the country's surplus in goods trade with the United States expanded for the first time in six quarters, Statistics Canada said on Friday.
The current account gap shrank less than expected to C$9.77 billion ($9.22 billion) from C$13.80 billion in the previous quarter. It was the fifth straight deficit after a decade of surpluses and was bigger than market expectations of an C$8.50 billion shortfall due to widening deficits in services trade and investment income.
The current account results add to growing evidence of a gradual economic recovery in Canada and come as the government is under pressure to map out a strategy to pay down its record-large fiscal deficit.
Related: U.S. Economic Growth Revised Upward (AP/CBC)
Congress and the administration squared off in the latest round of a two-year-old sparring match over100 percent cargo scanning, when Secretary Janet Napolitano on Thursday testified before the House Homeland Security Committee about the 2011 Department of Homeland Security budget.
Napolitano fended off questions from Chairman Bennie G. Thompson, D-Miss., who wanted to know when DHS would meet a congressional requirement for 100 percent scanning of all containers at foreign ports before they’re loaded aboard U.S.-bound ships. In 2007 Congress set a 2012 deadline for scanning all containers, but gave DHS the opportunity to extend the deadline if 100 percent scanning wasn’t feasible. Since then officials of the Bush and Obama administrations, including Napolitano, have testified that Customs and Border Protection could not meet the 2012 deadline.
Thompson noted that the proposed 2011 DHS budget includes a 48 percent reduction in money for the Secure Freight Initiative, the pilot program that tested the100 percent scanning idea. Customs cut $16.6 million from SFI, and said the pilot would stop at three of the five SFI ports. Read more here.
Thursday, February 25, 2010
Canadian General Freight Index sees slight monthly cost increase in December Canadian trucking costs appear to be stabilizing, but at a level nearly 10 percent lower than a year ago, according to an index based on less-than-truckload and truckload rates.
Overall freight costs rose 0.2 percent in December from the previous month, said the Canadian General Freight Index published by Nulogx, a transportation management company that processes more than $750 million in freight transactions a year. Read more here.
A meeting of transportation and logistics professionals was held here (Regina) yesterday to flush out a vision of establishing the region as a global transportation hub. The Global Transportation Hub Authority (GTHA) Board of Directors held its first meeting yesterday.
"We have assembled a diverse group of men and women with impeccable credentials in transportation logistics and international trade," GTHA Chair Wayne Elhard said. "With people whose names are instantly recognized in the international business community, the Global Transportation Hub (GTH) vision will quickly become a reality." Read more here.
Export Development Canada (EDC) today announced total business volume of $82.8 billion with a record 8,469 Canadian companies, despite a 24 per cent decline in Canadian exports in 2009.
"The recession and credit crunch constrained the capacity of financial institutions to fully support Canadian companies, triggering an increase in demand for our financial products in the last quarter of 2008 and throughout 2009," said Eric Siegel, President and CEO of EDC.
Last year, the Government of Canada asked EDC to increase the availability of domestic credit to Canadian businesses during the credit crunch. Working closely with private Canadian banks, Business Development Bank of Canada (BDC), credit insurers and sureties, EDC increased its capacity to serve Canadian businesses during the downturn, adding $2.5 billion in credit to the Canadian domestic market when it was needed most.
EDC's domestic activities directly helped 208 companies with their trade-related business in Canada during 2009. EDC will continue to support domestic transactions for the duration of its domestic powers. In addition, EDC increased the amount of business volume conducted in partnership with Canadian banks, BDC, sureties and other financial institutions both in Canada and internationally by 20 per cent, reaching $16.9 billion.
EDC's emerging market business volumes reached $18.7 billion, a decline of 15 per cent compared to 2008 but less than the overall decline in Canadian exports. Similarly, EDC's business volume for Canadian Direct Investment Abroad was $4 billion, a decline of 15 per cent compared to 2008. Read more here.
Wednesday, February 24, 2010
The 2010 federal budget will be presented on March 4, 2010, and KPMG invites you to attend a post-budget webcast that same day to quickly find out how tax changes in the budget may affect you and your business.
Senior KPMG Tax professionals will share their first impressions and insights on the budget’s tax changes shortly after they are released from the government’s advance briefing lock-up in Ottawa. The webcast will also feature two keynote speakers:
• The Globe & Mail political correspondent Jeffrey Simpson will comment on the budget’s political implications.
• Economist Jock Finlayson, Executive Vice President – Policy, Business Council of British Columbia, will comment on the budget’s economic implications.
Click here for more information.
Carriers may not be able to cope after August deadline for 100% screening of US-bound cargo
Delays are likely to affect the air freight industry with the introduction in August of 100% screening of cargo carried on passenger aircraft to and from the U.S., carriers have warned. Unless cargo is pre-screened under the U.S.’s Certified Cargo Screening Programme (CCSP), airlines may be unable to cope with initial volumes.
Dave Brooks, president and CEO of American Airlines Cargo, said: “It is simply not possible for carriers to screen all cargo, which would seriously compromise the value proposition of air freight.
“We may have to delay shipments that are not screened, and some customers with unscreened freight who haven’t engaged with us may be inconvenienced.”
While the airlines have been working hard to ensure customers understand the importance of pre-screening under the CCSP, carriers are ultimately responsible for the process. But the amount of cargo that will arrive at airports unscreened is still unknown.
“It’s hard to say what proportion of cargo will be pre-screened,” admitted Dwayne Baird, from the Office of Strategic Communications and Public Affairs at the US Transportation Security Administration. “But it’s the airlines’ primary responsibility, and I can’t speculate.”
A new protectionist American stimulus bill that could be signed into law soon has prompted fresh accusations from the opposition that the government has severely mishandled the recent Buy American deal. However, the trade minister says the new Canada – U.S. agreement, while not perfect, will in fact give Canadian businesses a competitive advantage.
The US “Jobs for Main Street Act, 2010,” colloquially known as Stimulus II, or the Jobs Bill, has billions in construction projects that will be covered by another Buy American provision. A version of Stimulus II has already been passed by both the U.S. House and the U.S. Senate, and the two versions are currently being reconciled. On Monday, the Senate took steps to avoid a Republican filibuster. U.S. President Barack Obama is intent on signing the bill into law, demanding in his recent State of the Union Address to see the bill on his desk “without delay.”
On Feb. 5, the Canadian government announced it had reached a deal with the U.S. exempting Canadian businesses from Buy American requirements in the original federal stimulus spending program, known as Stimulus I. This deal had three parts. One is access to seven U.S. stimulus projects, which had to be ready to proceed to construction within 12 months of February 2008.
Critics have said this provided very little time for Canadian companies to compete. In exchange, all provinces and territories signed on to the World Trade Organization’s General Procurement Agreement, allowing American companies to bid on provincial and municipal procurement contracts. The third part of the deal is an agreement to enter into negotiations within the year to set up a permanent procurement deal.
Because the U.S. - Canada deal only covers Stimulus I, if the U.S. passes Stimulus II before a permanent agreement is reached – a situation that is almost certain – Canada will have to negotiate again to receive exemptions. Read more here.
(Embassy – Lee Berthiaume)
Canada Post, provincial liquor boards across the country and Ontario’s new Green Energy Act are all being targeted by the European Union in its trade talks with Canada, confidential EU briefing notes show. While none are considered deal breakers, several touch on long-standing irritants between the two sides and go a long way to revealing just how far-reaching a deal negotiations are hoping for.
Last May, the Ontario government passed the Green Energy Act. The intent was to lay the foundation for a new renewable energy industry in the province. One of the key aspects was feed-in tariffs, in which the government pays individuals, communities and businesses that generate electricity from renewable sources like solar or wind. The idea is to offset the cost of implementing such projects.
However, in order to take advantage of the feed-in tariff program, or FIT program, a certain percentage of the project must include provincially-made goods and labour. […]
“The idea behind the domestic content regulations is to encourage investment, green manufacturing and construction and installation jobs in Ontario,” reads one of the EU documents. A second document (neither are dated) reads that the EU’s objective is “to convince the governments of Ontario and Canada to abandon the requirement to use domestically produced equipment to produce renewable electricity in order to benefit from high feed-in tariffs.” It goes on to state that the medium-term objective is to avoid the Ontario initiative becoming a precedent for other provinces. Read more here.
Monday, February 22, 2010
This Air Freight in Canada industry profile is an essential resource for top-level data and analysis covering the Air Freight industry. It includes detailed data on market size and segmentation, plus textual and graphical analysis of the key trends and competitive landscape, leading companies and demographic information.
• Detailed information is included on market size, measured by value and/or volume
• Five forces scorecards provide an accessible yet in depth view of the market’s competitive landscape
View the Air Freight in Canadareport here.
The U.S. Agriculture Department continues to review sugar supply and demand forecasts to evaluate food industry requests to boost sugar imports, a top official said Monday.
Sugar supplies in the United States are currently adequate, but there is much uncertainty in forecasts for the rest of the year, said Jim Miller, undersecretary charged with trade policy, in remarks prepared for the International Sweeteners Colloquium in Miami.
"We are carefully watching the global market for sugar due to the significant tightening of supplies throughout the world," Miller said.
Raw sugar prices have more than doubled in the past year, with futures SBc1 hitting a 29-year high of 30.40 cents per pound on Feb. 1. Under the U.S. sugar program, the government balances sugar use with domestic supplies and imports to ensure a minimum price to farmers at no cost to taxpayers. Sugar from Mexico can enter the United States without restrictions under the North American Free Trade Agreement. Food companies have urged the USDA to boost imports from other sources. Read more here.
Trans-Canada Series: March 29 – April
Locations: Moncton, Montreal, Markham, Cambridge, Winnipeg, Edmonton, Vancouver
In June 2010, the Canada Border Services Agency (CBSA) will begin accepting electronic manifests containing cargo and conveyance data from highway carriers. Unprecedented cooperation amongst all parties in the supply chain will be critical to ensuring that the right information gets to the right place at the right time to avoid delays crossing the border.
I.E.Canada, the Canadian Trucking Alliance and provincial trucking associations are partnering in this series of hands on workshops across Canada. Led by Oryst Dydynsky of The Descartes Systems Group Inc., an industry leader and Co-Chair of I.E.Canada’s Customs and Legislation Committee, and Jason Proceviat of CBSA, each workshop will include an overview of the eManifest highway initiative and the new requirements, as well as an interactive walk-through exercise to highlight the process changes that will be required of carriers, freight forwarders, importers and their brokers.
For further details or to register contact: Jesse Arsenault, 416-595-5333 ext. 37
Meet with premiers; Gathering hailed as ‘huge step forward’
Canadian politicians have long complained about the challenges of getting their voices heard in U.S. halls of power. But for seven Canadian premiers, there’s no longer any reason to complain.
Armed with arguments and statistics in favour of free trade, and employing a bit of Canuck charm, Canada’s provincial leaders got an enthusiastic welcome this weekend from U.S. state governors who generally endorsed calls for stronger cross-border ties and commerce.
By the end of the premiers’ first-ever meeting on Saturday with the National Governors Association, Pennsylvania Governor Ed Rendell was singing a gravelly voiced rendition of O Canada. Mississippi Governor Haley Barbour proclaimed the Canada-U.S. relationship as “breathtaking” and unique to the world. Read more here.
Infineon AG, Europe’s second-largest chipmaker, filed a patent-infringement complaint that seeks to block U.S. imports of computer-memory chips by Japan’s Elpida Memory Inc.
In a complaint filed Feb. 19 with the U.S. International Trade Commission in Washington, Infineon claims Elpida infringes four patents related to dynamic random access memory, or DRAM, which acts as the main memory in computers.
“Infineon has always been at the forefront of advanced semiconductor processing technologies,” Hermann Eul, an Infineon management board member, said in a statement. “We will protect our intellectual-property rights, which arise from our commitment to cutting-edge research and development.”
Should it win the case, Infineon might be able to shut Elpida, Japan’s biggest DRAM maker, out of the U.S. market. The global market for DRAM chips is expected to surge by more than 40 percent this year to $31.9 billion as prices rise and demand for personal computers recovers, research firm ISuppli Corp. said last week. Read more here.
Saturday, February 20, 2010
Let’s Talk Exports is an annual, cross-Canada tour designed to provide you with the most up-to-date information available on the global economy and its implications for Canadian trade and investment opportunities. The 27th annual cross-Canada tour will be held in 21 cities between April 27 and June 1, 2010.
Join EDC’s Peter Hall, Vice President and Chief Economist, as well as an impressive cross-section of business professionals at this year’s Let’s Talk Exports event and find out:
• where the risks and opportunities are for businesses in 2010-2011
• what the export outlook is for your industry
• which provinces will fare better in the current environment
• how you can succeed in the global marketplace
Plus, each attendee will get access to EDC’s sought-after Global Export Forecast, 2010 Spring Edition.
Don’t make critical business decisions without attending this event!
Let’s Talk Exports is scheduled in the following cities: Burlington, Calgary, Drummondville, Edmonton, Fredericton, Halifax, Kitchener Waterloo, Moncton, Montréal, Montréal-West Island, Ottawa, Québec, Regina, St. John’s, Sudbury, Surrey, Sydney, Toronto, Vancouver, Vaughan and Winnipeg.
Sign up now to receive notification when event information becomes available for the Spring 2010 tour.
(Health Canada via The Canadian Press)
Health Canada is seeking public input on proposed changes to improve labelling requirements for colouring agents in food products. A consultation forum will be posted on the Health Canada website and open for comments from February 18 until May 4, the federal department said Thursday.
Canadian Food and Drug Regulations currently allow manufacturers to use the general term "colour" to specify one or more food colours. For the majority of prepackaged foods, manufacturers may voluntarily declare individual colours by name at their own discretion.
"However, there is some evidence suggesting a link between consumption of certain food colours and adverse reactions in sensitive individuals," the department said in a release. "More recently, certain food colour mixtures have been associated with behavioural effects in children. For these reasons, Health Canada considers it prudent to improve labelling requirements for food colours."
Proposed changes would eliminate the option of using the general term "colour" and require that individual colours be identified on food ingredient labels, enabling consumers to make informed choices that could reduce adverse reactions.
Health Canada said it will update progress on the issue once the consultation period has ended.
Comments on proposals may be submitted by regular mail to:
Bureau of Chemical Safety
251 Sir Frederick Banting Drive
Health Canada, Tunney's Pasture
Address Locator: 2203B
Ottawa, Ontario K1A 0L2
To comment electronically, email email@example.com, using the words "Food Colour Labelling" in the subject box.
Friday, February 19, 2010
The Honourable Denis Lebel, Minister of State for the Economic Development Agency of Canada for the Regions of Quebec, announced today [Thursday] that the Government of Canada will be investing in a project to optimize infrastructure at the Port of Montreal, which will have a positive impact on the economic development of the region in the short, medium and long terms.
This investment will be used to improve the electrical facilities, control equipment and network management, so as to increase access point capacity along Hydro-Quebec’s network in the Port of Montreal.
The Government of Canada will provide up to $4,648,500 for this project under the Infrastructure Stimulus Fund. The Montreal Port Authority will cover the remaining costs of the project, which is estimated to total $9,297,000.
“With this second Infrastructure Stimulus Fund investment in the Port of Montreal, our Government is investing in the economic futures of Quebec and of Canada,” said Minister Lebel. “As we begin the second phase of Canada’s Economic Action Plan, our priority will be to continue the rapid implementation of projects such as this one. At the same time, we look forward to meeting future challenges, including restoring the fiscal balance once our economy is fully recovered, as well as building a solid foundation for our economic future.”
Thursday, February 18, 2010
Trade issues, relatively neglected in 2009 as a new president and a strengthened Democratic majority in Congress focused on other issues, are set to take on a larger profile in 2010 as policymakers look to trade to help boost domestic employment. The Obama administration is expected to focus on negotiating two multilateral agreements and strengthening enforcement of existing pacts. Congress, meanwhile, will consider issues such as trade preference reform and food safety as well as a customs reauthorization bill.
This article presents a summary of some of the major trade-related issues likely to come up in 2010. For a more comprehensive overview of the 2010 trade agenda, please click here for a white paper prepared by ST&R’s government affairs team.
CBP has posted new and updated sections of the ACE User Guides reflecting detailed instructions for the trade community on using capabilities that were delivered as part of the Entry Summary, Accounts and Revenue (ESAR) A2.2 (delivered April 12, 2009) and A2.3.1a deployment (delivered February 14, 2010).
The new section is titled, "AD/CVD Cases and Management" and provides instructions on searching and printing information related to AD/CVD cases and messages. To access this new section, go to CBP.gov under under ACE Modernization/Training & Reference Guides/ ACE Portal Accounts Management.
The updated sections are as follows:
• Blanket Declaration Records- provides instructions on creating, searching and printing declaration records for portal and non-portal accounts. To access this updated section, go to CBP.gov under ACE Modernization/Training and Reference Guides
• Running ACE Reports for Importers, Brokers and Sureties- provides information on basic functionality of the ACE Reports Tool and outlines detailed instructions on how to access available reports (including standard, modified, customized and automated data extract (ADE) report) . To access this updated section, go to CBP.gov under ACE Modernization/Training and Reference Guides
• ACE 101- provides an overview of the ACE Secure Data Portal as well as current and future ACE features. To access this updated section, go to CBP.gov under ACE Modernization/What is ACE
Wednesday, February 17, 2010
The World Economic Forum’s Logistics & Transport Industry Group, supported by global consulting firm Accenture, has agreed to standard guidelines for calculating consignment-level carbon emissions from logistics and shipping operations.
The Consignment-Level Carbon Reporting Guidelines developed with Accenture, were created to help the industry inform consumers and businesses about the carbon impact of product transport.
A recent Accenture survey found that 90% of consumers would be willing to switch to a new product if it was certified as minimizing its impact on climate change, while another Accenture survey found that 98% of Chinese consumers would pay a premium for consumer electronics products that are marketed as environmentally friendly.
“Logistics and transportation providers face growing demand from their retail and manufacturing customers to report the carbon emissions generated by the shipping and handling of their products,” says Jonathan Wright, senior executive in Accenture’s Supply Chain Management practice. “These guidelines will help them work toward providing consumers with carbon footprint information for individual products.” Read more here.
This departmental memorandum explains the Release Prior to Payment Privilege that was previously found in D17-1-5. This memorandum is revised as a result of the Paper Burden Reduction Initiative; the revisions are aimed at eliminating obsolete and duplicated requirements, streamlining certain commercial processes and modifying complex policies and forms.
The following sections have been expanded for further clarification of the subjects: a) The Direct Security and GST Options; b) Procedures related to late payment and non-compliance; and c) Maintaining security for importers and customs brokers.
This memorandum has been revised to:
a) Remove the section regarding release of commercial goods, which can now be found in D17-1-4; b) Remove the section regarding release prior to payment privilege, which can now be found in D17-1-8; c) Incorporate related customs notices; CN384, CN412, CN503; d) Update related forms; e) Update various web site references and contact information; and, f) Reflect the organizational changes resulting from the creation of the Canada Border Services Agency (CBSA).
Export USA Webinar: How to Get Your Medical Products and Services Reimbursed by U.S. Healthcare Insurers – March 4
(Foreign Affairs & International Trade Canada)
In order for your medical products and services to be successful south of the border, U.S. insurance companies must include them in their reimbursement schemes. Canadian businesses wishing to seek U.S. opportunities in this niche market need to understand the relationship between healthcare providers, patients and insurance companies.
This webinar will provide insight into various aspects of the U.S. insurance industry’s healthcare coverage. You’ll learn all about the industry’s coding, coverage and reimbursement practices in order to develop an effective business strategy for this market.
By participating in the webinar, you will:
• Learn about the different types of coverage and various codes required by healthcare institutions (e.g., clinics and hospitals);
• Understand what your clients need to do to get your products and services reimbursed;
• Learn more about the various claim delivery forms available; and what is required to secure the payment of a healthcare claim.
Date: Thursday, March 4, 2010
Time: 1:00 to 2:00 p.m. EST (Ottawa Time)
The presentations will be followed by a 20-minute Q&A period. The presentations will be in English but the speakers will take questions in both English and French.
Through the Virtual Trade Commissioner, the webinar will be made available for on-demand viewing following the live session. Participants may also download the presentation slides, in both French and English.
Please register by March 3, 2010, here. For additional information, please email TCS-Webinar.GNC@international.gc.ca.
Canadians will import another big dose of American social and economic inequality with yet another bad trade deal made in our endless -- and endlessly futile -- pursuit of the Holy Grail of “guaranteed access” to the U.S. market.
Canada’s so-called “exemption” from the about-to-expire Buy America stimulus package will be minimal and, as usual, subject to cancellation at American whim.
Also as usual, Boy Scout Canada has put almost all it has to give on the American table. U.S. business will gain nearly unfettered access to the multibillion-dollar public purchasing of all provinces, territories, cities with more than 50,000 inhabitants and public entities including Crown corporations, universities, school boards and health-care institutions.
And what do Canadians get? Liberal international trade critic Scott Brison says more than 75 per cent of the U.S. stimulus package has already been spent “so the best we can get is just the crumbs.”
“Canada didn’t obtain any guarantees on future American spending programs... Only 37 of the American states have signed on and of those they have carved out huge items including construction in some cases and public transit in others,” he continued in an interview. “The government is grossly overselling a questionable, underwhelming and late deal... It’s going to open us up to more American competition but it’s not clear to me how much access we’re going to gain in return. The government was desperate for a symbolic victory... a photo op.” Read more here.
Tuesday, February 16, 2010
Inspection of meat products coming into Canada from the United States has been cut back and Canadians could suffer for it, MP Brian Masse (NDP – Windsor West) said Friday. Masse held a news conference at his constituency office flanked by representatives of Windsor’s two locations where meat inspections are conducted.
“There have been changes to border policy and food inspection policy that are putting Canadians at greater risk than before and we’ve been fortunate enough to have some individuals come forward to bring that concern to me,” said Masse, who wrote a letter to Gerry Ritz, the minister of agriculture.
New government policy that went into effect on January 4 sees inspections conducted at Windsor Freezer and Border City Storage from 8 a.m. to 6 p.m. Monday to Friday, a reduction of two hours a day from previous levels.
Masse wants to see Canada adopt many of the same stricter policies and penalties as the U.S. when it comes to food inspection. Since the new policy went into effect there have been 70 trucks that have been guided to inspection in Windsor, but ignored the order and continued on to their destination without penalty.
“The problem we have and we see here is, if that truck doesn’t report for inspection, it’s just basically let go, a slap on the hand, there’s basically no penalty,” said Phil Marchuk, president of Windsor Freezer Services Ltd. “In the States if you miss going to an inspection, your fine is three times the load you’re carrying. Nobody skips inspections in the States because it’s too risky and too much of a bother.” Read more here.
The Moroun family seldom steps out of the shadows to show itself to the world. They may be billionaires. They may own the most important bridge Canada has ever known. But they are just shy that way.
Yet when the local media takes to calling you “crabgrass,” when Forbes magazine slams you as “the troll under the bridge,” when you are on the verge of all-out war with Ottawa, exceptions must be made.
So here we are, inside the American family’s astonishingly private corporate headquarters in suburban Detroit, with Matthew Moroun sitting across the table like the proverbial deer in the headlights.
To call the conversation exclusive doesn’t quite do it justice. At 37, the younger Moroun is in the process of taking over the company reins from his rags-to-riches father, 83-year-old Manuel “Matty” Moroun. The heir apparent has never given an interview. Until now. Read more here.
Monday, February 15, 2010
In a memorandum sent Friday to the Office of the U.S. Trade Representative (USTR), R-CALF USA [a national cattle producer organization – Ed.] explained that the U.S. District Court for the Eastern District of Washington (Court) recently issued an order that addresses a principal argument contained in the complaints filed at the World Trade Organization (WTO) against the U.S. country-of-origin labeling (COOL) law by Canada and Mexico. The order stems from the lawsuit that Easterday Ranches Inc. (Easterday) filed against the U.S. Department of Agriculture (USDA) regarding the U.S. COOL law.
In that litigation, Easterday argued that the U.S. Department of the Treasury’s marking rules, established to implement the North American Free Trade Agreement (NAFTA), provide that beef derived from the slaughter of imported cattle in the U.S. market is entitled to be designated as a product of the USA. Easterday further argued that as a result of these preexisting marking rules (NAFTA marking rules), the COOL law improperly requires beef from such imported cattle to be labeled as a product of both countries – Canada and the United States.
The Court disagreed. In its Feb. 5, 2010, order the Court found that the COOL law can coexist with, and does not repeal, the preexisting NAFTA marking rules because these rules are for purposes of tariff designation in a customs setting, while the COOL law applies to retail products, and because the COOL statute neither covers the whole subject matter of the NAFTA marking rules nor does the COOL law present an irreconcilable conflict with those rules.
“We believe this U.S. Court decision will help in the defense of our COOL law against Canada’s and Mexico’s attack at the WTO,” said R-CALF USA COOL Committee Chair Mike Schultz.
“Much like the Easterday complaint filed in the U.S., both Canada’s and Mexico’s complaints filed at the WTO are seeking the same protection,” he continued. “And like Easterday, Canada and Mexico want to continue hiding the true origins of their foreign beef in the U.S. marketplace. Read more here.
Despite objections from the Ontario Federation of Labour, Canada and the US have signed a government procurement agreement with the hopes of ending Canada’s problem with the “Buy America” clause in the US Economic Recovery and Reinvestment Act of 2009.
The agreement gives US firms permanent access to Canadian provincial and territorial procurement contracts consistent with the WTO’s Government and Procurement Agreement (GPA). American companies will also be able to compete for Canadian construction contracts not covered under the GPA through September 2011, Steel Business Briefing understands.
In turn, the US will provide reciprocal access for Canadian companies to 37 US states already covered by the GPA, but will only give access to “a limited number of Recovery Act programs,” according to a statement from the US Trade Representative’s office.
The two countries are also committed to exploring a long term government procurement agreement within the next 12 months “to deepen on a reciprocal basis, procurement commitments beyond those in the WTO GPA and NAFTA,” says the Foreign Affairs and International Trade Canada website.
“This agreement resolves key outstanding US-Canada government procurement issues and creates tens of billions of dollars worth of new job-supporting export opportunities for American companies and workers,” commented USTR Ron Kirk.
As SBB reported, the Ontario labor group objected to some US-favoring terms of the agreement and was encouraging the Canadian government to reject it, calling it “unfair” and “lopsided.” The group could not be reached for comment over the weekend.
Leaders discuss bilateral issues in advance of summer’s G8, G20 summits
Stephen Harper thanked U.S. Vice-President Joe Biden yesterday for working to put an end to American protectionism and opening up the cross-border trading relationship again.
“I want to thank the [Obama] administration for concluding Buy America,” the Prime Minister said yesterday during a photo op with the Vice-President.
The two met in Vancouver; Mr. Biden is here leading the U.S. Olympic delegation and attended the opening ceremony of the Vancouver Winter Games Friday night. Read more here.
Saturday, February 13, 2010
This latest report examines why Canada’s international trade cannot be taken for granted. Global trade can be expected to rebound as the recovery takes hold and demand resumes. But recovery does not necessarily spell future trade success for Canada. The author, Anne Park Shannon focuses on such ‘tools’ as a more competitive use of foreign direct investment, trade diversification outside of the U.S., a look at imports and regional and global value chains. Three shifts in policy direction are explored.
The report is available to download free of charge by registering with the Conference Board’s e-Library. Go here to access the e-library. (There is no cost for registration.)
Friday, February 12, 2010
The Canadian dollar has recovered from the losses it suffered during the financial crisis, and seems set to reach parity with the U.S. dollar within the next year or two. There has also been a recovery in commentaries expressing concern for the effects of this appreciation on exports, particularly in the manufacturing sector. Between 2002 and 2008, our currency rose by 50%, and the manufacturing sector shed more than 300,000 employees. Shouldn’t the Bank of Canada be trying to prevent this from happening again?
Well, no. These arguments miss a key point of international trade theory: exports are costs. The reason we participate in world markets is to obtain goods that we can’t easily produce for ourselves; exports are the price we pay to foreigners in exchange for the imports we want. In a perfect world, we would obtain an infinitely large quantity of imports in return for an infinitely tiny amount of exports. So, a rising dollar is to be welcomed. Read more here.
Ecotex Healthcare Linen Service Inc. operated in the United States in the mid-1990s, before the weak Canadian dollar drove it back north of the border. When shifting fortunes for the loonie opened up new possibilities outside of Canada, Ecotex CEO Randy Bartsch knew one of the steps he needed to take was to get U.S. tax advice. Plenty of it.
“Every different local county, state, city and town have different tax rates,” said the head of the Abbotsford, B.C.-based company, which ultimately re-entered the United States through a 2008 acquisition of a business in Tacoma, Wash. “In some places, it can be 4.93%, and across the street, which is also across the county line, it could be 5.19%.”
While Ecotex knew what it was getting into, many other Canadian businesses are caught off guard by the complexity of the U.S. tax system, with its 7,000-plus taxing jurisdictions, Canadian chartered accountants say.
And while Ecotex was clearly going to be paying the U.S. taxman, by dint of owning and operating laundry facilities in that country, many Canadian businesses that have U.S. sales but no physical presence in the United States think they’re off the hook.
That’s not necessarily so.
It all adds up to a nightmarish spider-web of tax rules and regulations that can easily entrap Canadian entrepreneurs. At a minimum, it makes the United States, a country with a reputation for cost-cutting, an expensive place to do business. Read more here.
Thursday, February 11, 2010
U.S. President Barack Obama says last week his administration is putting increased pressure on China to open up its domestic market further to reciprocal trade.
Speaking at a Washington meeting with Democratic Party senators on February 3, Obama said that if the United States can increase its trade with Asia by even one percentage point that will create thousands, maybe millions, of new U.S. jobs.
He said the important thing is to get Beijing to live up to existing trade rules. Obama also raised the thorny issue of the exchange rate of the Chinese yuan, which for years U.S. officials have considered to be deliberately undervalued by China. Experts estimate the yuan is presently undervalued by about 30 percent overall against major world currencies and about 40 percent against the dollar.
A Knowledge at Wharton Interview, from the recent K@W Real Estate Forum in New York, with Jeffrey Schwartz, Chairman and Co-Founder of Global Logistic Properties.
A new bank report says Canada is well-positioned to take advantage of the debt crisis in Europe and growing fiscal problems in the U.S.
The CIBC says Canada is increasingly being seen as a safe harbour in the looming global debt storm. The bank says Ottawa’s fiscal position already compares favourably with most of Europe and the U.S. and will only improve over the next few years. As well, a stable loonie will add to Canada’s lure for foreign investors, the chartered bank says. Read more here.
The White House appears to have awoken from its year-long slumber on trade matters, but the political climate for liberalising trade in the world’s biggest national economy remains problematic.
The action began on 27 January, when U.S. President Barack Obama, addressing a joint session of Congress for his State of the Union address, highlighted trade as an important tool for economic recovery and job creation, calling for the U.S. to double its exports in five years.
A week later, Commerce Secretary Gary Locke explained how the White House intends to achieve those goals. The administration will create the first-ever “government-wide export-promotion strategy” that will receive “the focused attention” of the president and his cabinet, Locke said in an address at Washington’s National Press Club on 4 February. The new National Export Initiative will work on three fronts: expanding trade advocacy at home and abroad; helping companies, especially small- and medium-sized firms, access the credit they need to export their products; and enforcing trade rules so that U.S. exporters will not be unfairly blocked from foreign markets.
“This initiative will correct an economic blind spot that has allowed other countries to chip away at America’s international competitiveness,” Locke said.
Turning to new markets, the Commerce Secretary mentioned the work that the U.S. Trade Representative’s Office is doing to open up trade with “key growth areas” in Asia and elsewhere, as well as the USTR’s efforts to strike “an ambitious and balanced” deal to end the WTO’s Doha Round talks. Locke referred briefly to Washington’s three pending bilateral trade deals – with Colombia, Panama and South Korea – noting that the White House aims to address “outstanding concerns” with each of the pacts. Read more here.
China will test the WTO’s dispute-settlement system
In 2009 China overtook Germany to become the world’s largest exporter. Exactly half the trade disputes that were filed at the World Trade Organisation (WTO) last year involved China. These facts are not unrelated. As Pascal Lamy, the WTO’s chief, pointed out in January, the scope for trade friction increases as countries trade more. Disputes between China and other countries are only to be expected.
Mr Lamy did not have to wait long for evidence to back up his claim. On February 8th China complained to the WTO about the European Union’s anti-dumping duties on Chinese-made shoes. This latest fracas over footwear follows recent complaints by the Chinese about restrictions on its exports of steel fasteners, car tyres and poultry. Having initiated just two disputes between joining the WTO in 2001 and September 2008, China has complained to the WTO another five times since then. Marc Busch of Georgetown University in Washington, DC, says that China has moved from “learning by watching”, where it mainly observed others’ trade tussles, to being an active participant in formal dispute settlement.
China’s increasing propensity to bring disputes to the WTO is part of a broader shift. Although the average number of formal disputes per year has fallen since 2001, this is principally because rich countries spend less time fighting each other. Between the WTO’s founding in 1995 and the end of 2000, America and the EU initiated exactly half of the cases brought to the WTO. But between 2001 and 2008 they brought only 27.2% of cases. Over half were initiated by developing countries. Read more here.
Several freight forwarders – including Kuehne + Nagel (KN) and Panalpina – have received Statement of Objections from the European Commission over alleged price fixing. The EC said the statements had been sent out over allegations of price-fixing cartels within the firms’ air forwarding divisions.
It said: “The commission is investigating allegations that these companies fixed prices by colluding on the imposition, level, timing and application of various surcharges.
“The allegations concern four separate infringements involving the provision of freight forwarding services from the UK to outside the European Economic Area (EEA), from the EEA to the U.S., from China to the EEA and from southern China/Hong Kong to the EEA.” Read more here.
Related: Canada drops forwarder cartel case (IFW)
CFIA: Importation of Fresh Tomatoes from Countries Infested by the Tomato Leaf Miner (Tuta Absoluta)
Effective February 24, 2010, shipments of tomato fruits from countries infested by the insect pest, Tuta absoluta, will be required to be accompanied by a Phytosanitary Certificate with an additional declaration stating: “This consignment originated from a place where Tuta absoluta is known not to occur and was inspected and found free of Tuta absoluta”. Shipments not meeting this requirement will be refused entry to Canada. The new phytosanitary import requirement for tomatoes will soon be available in a new policy directive (D-10-01).
Regulated countries: Albania, Algeria, Argentina, Bahrain, Bolivia, Brazil, Chile, Colombia, Ecuador, France, Greece, Kuwait, Italy, Libya, Malta, Morocco, the Netherlands, Paraguay, Peru, Portugal, Spain, Switzerland, Tunisia, United Kingdom, Uruguay, and Venezuela.
For all questions relating to these changes please contact:
Import Control and Enforcement Officer
Import control and Export Market information
Telephone: (613) 221-4331 Fax: (613) 228-6605
This 2010 edition of OECD’s periodic review of China’s economy includes chapters on recent achievements and prospects, monetary policy, financial reforms, product market regulation and competition, inequality, the labour market, old-age security and the health care system.
Wednesday, February 10, 2010
This publication is not a legal document. It contains general information and is provided for convenience and guidance in applying the Competition Act, the Consumer Packaging and Labelling Act and the Textile Labelling Act.
This publication replaces the following Competition Bureau publications: Enforcement Guidelines – Guide to “Made in Canada” Claims – January 22, 2002 [and] Enforcement Guidelines – Enforcement Guidelines Relating to “Product of Canada” and “Made in Canada” Claims, Draft for Public Consultation, July 10, 2009
Revised: D19-7-2 Requirements Concerning the Importation & Exportation of Ozone-Depleting Substances & Products
Memorandum D19-7-2 has been updated and replaces the previous Memorandum D19-7-2, dated April 16, 1997. Memorandum D19-7-2 reflects the Ozone-depleting Substances Regulations, 1998. In addition, Appendices F and G have been added to this memorandum.
This memorandum outlines procedures for the importation and exportation of ozone-depleting substances.
The Ozone-depleting Substances Regulations, 1998 reflect Canada’s commitment to meet its requirements under the Montreal Protocol on Substances that Deplete the Ozone Layer (Montreal Protocol). The Montreal Protocol is an international agreement signed by 194 countries to control the production and exchange of certain ozone-depleting substances. The Regulations are intended to further reduce emissions of ozone-depleting substances.
Confidential European briefing notes show a desire to bid on contracts with utilities, port and airport authorities
European Union negotiators want access to procurement competitions in an extensive list of Canadian cities, utilities and Crown corporations in a market they estimate is worth $86 billion, according to confidential EU briefing notes provided to Embassy.
The documents, including the EU’s “initial market access request to Canada,” dated December 2009, detail some of what the trading bloc is seeking in opening up bilateral trade, investment and labour mobility. And when it comes to government procurement, they want it all.
“All central government entities and all other central public entities,” should be open to contracting European goods and services, the request says, pointing to the federal level. At the provincial and territorial level, the request is similar: “All sub-central government entities including those operating at the local, regional or municipal level.”
That includes, for example, opening up bidding for goods and services for the Prime Minister’s Office, the House of Commons, the Senate, Elections Canada, the Library of Parliament and Public Safety and Emergency Preparedness Canada. Two of the government’s biggest buyers, Public Works and Government Services Canada and Transport Canada, are also on the list. Read more here.
Winter storms disrupt freight movements from Great Lakes to Atlantic
Winter storms Wednesday stopped or slowed freight traffic and closed facilities from the Great Lakes to the East Coast. An expansive area of wintry precipitation is “moving from the Mississippi River Valley into the Midwest and toward the Mid-Atlantic,” said the National Weather Service. “Widespread heavy snows are likely over the next few days from the Great Lakes, upper Ohio Valley, central Appalachians, northern Mid-Atlantic, and into the New York City metro area/southern New England region.” Read more here.
(Reuters – Louise Egan)
Canada’s trade deficit in December was twice the size expected and contributed to the country’s first annual trade gap since 1975 even though more goods were sold to the United States in the month.
The December shortfall was C$246 million ($230 million), up from a revised deficit of C$201 million in November, Statistics Canada reported on Wednesday. Markets had expected a C$100 million deficit for December. The 2009 deficit totaled C$4.79 billion, compared with a surplus the year before of C$45.9 billion.
Summary statistics and links to the data files are on the Statistics Canada website. Export and import price indexes are available here.
• Canada has first yearly trade deficit since 1975 (Globe & Mail)
• U.S. Trade Deficit Widened in December (New York Times)
Tuesday, February 9, 2010
Stephen Harper has instructed his ministers to explore the prospect of buying the Windsor-Detroit bridge — the busiest international border crossing in North America — from its American owner.
The Ambassador Bridge is owned by billionaire Manuel “Matty” Moroun and carries one quarter of all merchandise trade between Canada and the United States.
Lawrence Cannon, the Foreign Minister, said buying the bridge from the private sector is one option being examined. “My understanding is that the file is progressing and there are options being looked at,” he said.
He added the government’s first choice would be to pursue development of a new publicly owned bridge, the Detroit River International Crossing, down river from the Ambassador Bridge. But he said that deal is complicated by the involvement of state governments in the United States. “No decision has been taken on what specific option to take,” he said. Read more here.
A 2007 study points out that more than seven million U.S. jobs depend on trade with Canada
If Barack Obama’s intention is to create jobs for Americans by boosting trade, he’ll have to start paying more attention to the beleaguered Canada-U.S. border.
Obama’s jobs message, outlined in a recent State of the Union address to Congress, suggests Canada may finally have the opening it needs to take its long-standing case for easing border bottlenecks to Washington.
An article by American researcher Kathryn Friedman, appearing in the latest issue of the Canadian political journal Policy Options, urges stakeholders on both sides of the border to begin lobbying D.C. policy-makers, reminding them that “the Canada-U.S. economic relationship . . . is the lifeline for continued prosperity.”
Friedman, deputy director of the University of Buffalo Regional Institute, says it’s time for the two countries to devise a joint governing structure for the 49th parallel, “perhaps one modelled upon Norad,” which supervises continental air defence.
“The global recession provides an opportunity to link recovery of the United States and President Obama’s legacy to border policy,” writes Friedman. Read more here.
Monday, February 8, 2010
Penalties won’t start for months, but the agency isn’t waiting to notify violators
For importers still in denial about the Importer Security Filing rule, Customs and Border Protection has a message: “We’re not delaying enforcement. What you submit or don’t submit is going to be held against you,” said Richard DiNucci, director of the Secure Freight Initiative.
Customs began enforcing the rule – known as 10+2 because of the 10 security data elements the agency now requires from importers and two from carriers 24 hours before a U.S.-bound container is loaded aboard a ship – on January 26, but because the agency is still two or three months from imposing penalties, some traders don’t believe it’s happening, DiNucci said.
True, Customs won’t be assessing liquidated damages – fines of $5,000 per violation, before mitigation – until the second or third quarter. But it’s tallying ISF violations to build its case for taking tougher measures.
“We review the data. If you’re consistently missing a data element, you will get a notice from us that the data isn’t included or it is inaccurate. Or if you’re consistently late, we’ll tell you to clean it up,” DiNucci said. Read more here.
In a Feb. 4 speech to the Center for Strategic and International Studies, Food and Drug Administration Commissioner Margaret Hamburg laid out the elements of the “new approach” the agency is adopting to ensure the safety of imported food and drug products. Hamburg said FDA is “moving from a system that places most of the regulatory burden on the FDA’s modest inspection force, to one that creates greater oversight at points further back along the production chain.” The FDA needs to know “who is making our foods and drugs [and] where they are located,” she said, “and we need to be sure that these facilities are being inspected and are accountable for what goes into their products as well as the products they produce.”
Hamburg asserted that “massive change is required for FDA to be able to keep up with a globalized economy.” It is “simply not possible to count on interdicting everything harmful at our borders,” she said, noting that an estimated 20 million shipments of FDA-regulated imports will enter the U.S. in 2010 but that less than 1% are likely to be examined by FDA inspectors. “Similarly,” she added, “FDA cannot alone conduct a sufficient number of inspections at foreign manufacturing facilities to help ensure product safety.”
As a result, Hamburg said, “FDA must adopt a new approach …. an approach that takes into account the entire supply chain and its complexity; and an approach that will address product safety by preventing problems at every point along the global supply chain… from the raw ingredients… through production… and distribution… all the way to U.S. consumers.” Read more here.
More than half of high-speed rail grants will go into freight corridors to build up inter-city passenger service
It took nearly a year and a stubbornly high unemployment rate before the Obama administration recast its long-awaited $8 billion in rail system grants as part of a jobs strategy.
But when the White House unveiled its list of winners for high-speed rail funding, to boost passenger train service between cities, it quickly became clear large parts of it would go into the freight rail corridors that also carry Amtrak trains.
For instance, of the 13 funding corridors that traverse parts of 31 states, just two would be true high-speed passenger lanes with “bullet trains” that would need their own walled-off tracks away from freight operations. Read more here.
International traffic leads fourth-quarter gain in long-haul moves
U.S. freight shippers sent their highest shares yet by intermodal combination moves in the 2009 fourth quarter, compared with using trucks only, said transportation consultants FTR Associates. Intermodal, which pairs short-haul trucking with long-haul rail service, took an estimated 13.3% of the long-haul market for international and domestic containerized freight, FTR said.
That is up 0.2% from the third quarter and is “slightly above the previous high-water mark” in fourth-quarter 2008, FTR said. “Intermodal has gained share for three consecutive quarters since the freight meltdown” began, said Lawrence Gross, senior consultant for FTR. Read more here.
The federal government is to be congratulated for finally getting a deal allowing Canadian companies to bid on more American stimulus projects. But the deal came after great delay, and therefore at great cost. Moreover, Buy American is not dead; the deal is not ironclad, and many aspects are not permanent, or do not apply to other American governmental spending. More than ever, the Canadian government must be vigilant and make a strong case that, despite the recession, freer trade is ultimately in both countries' interests.
The deal comes just before the first anniversary of the passage of the U.S. stimulus bill, which largely forbade the use of Canadian iron, steel and manufactured goods in stimulus projects. Since then, much damage has been done. As little as $18-billion (U.S.) in stimulus funds may be left for Canadian companies to bid on, and the deadline for project decisions to be made is less than two weeks away. Although many contracts will be signed after that date, many Canadian companies have already been disadvantaged by being shut out for so long.
Even then, the victory is not a complete one. Only 37 American states are included. Both sides reportedly threw protective blankets over major sectors: transportation and energy in Ontario and federally funded transportation projects in the United States. Read more here.
Related: Silver Lining Outshines Any Clouds in Buy American Deal, Ont. Premier Says (Globe & Mail)
Friday, February 5, 2010
Industry Minister Tony Clement says government is concerned Obama’s new jobs bill may bring about measures similar to Buy American legislation
The Canadian government is concerned the new jobs bill that President Barack Obama has asked Congress for may be used by U.S. lawmakers to push through more protectionist measures similar to the hated Buy American legislation.
“Whenever anything goes to Congress there is always the threat of new protectionist measures,” Industry Minister Tony Clement told reporters in Ottawa. “We’re going to have to continue to work, because we know that Congress is a place where things can pop up at the last moment and be tacked onto pieces of legislation.”
While the minister offered no concrete update on Canadian efforts to be granted an exemption from the Buy American provisions in last year’s stimulus bill, he said negotiations are ongoing and said he is “quite hopeful” they’ll yield a positive result. Read more here.
February 11 • 3:00-6:00pm
250 Yonge St, 35th floor
Discover how to link into the power of Global Value Chains (GVCs) to build your business. Come hear featured speaker Bob Armstrong, President, Supply Chain Logistics Canada Association and former President and CEO of the Canadian Association of Importers and Exporters Inc. for nine years, as he discuss current trends in supply chains and their implications on Canadian businesses.
Other presenters include Sarah Dionne of Foreign Affairs and International Trade Canada, who will discuss DFAIT’s initiatives with respect to GVCs and how this fits into the Global Commerce Strategy. Other topics covered include the tools available to the exporter as well as how TFO Canada can help importers find new sources of product abroad. TISA will explain its various initiatives related to seizing opportunities in GVCs.
For more information, see attached flyer.
To register, call 416-479-0057 ext.2 or email firstname.lastname@example.org
The United States will insist other countries honor commitments to open their markets as it strives to meet President Barack Obama’s goal of doubling exports during the next five years, U.S. Commerce Secretary Gary Locke said on Thursday.
“Free trade only works in a system of rules where all parties live up to their obligations,” Locke said in the prepared text of a speech he was to give detailing Obama’s National Export Initiative, or NEI. “The United States is committed to a rules-based trading system where the American people and the Congress can feel confident that when we sign an agreement that gives foreign countries the privilege of free and fair access to our domestic market, we are treated the same.”
Locke did not direct his comments at China or any country by name. But Obama made clear on Wednesday the United States planned to keep up pressure on Beijing. “The approach that we’re taking is trying to get much tougher about enforcement of existing rules, putting constant pressure on China and other countries to open up their markets in reciprocal ways,” he told Democratic senators. Read more here.
The Conservative government today announced a tentative Canada-United States procurement deal intended to help Canadian companies get around the protectionist wall thrown up by recession-battered Americans.
But in exchange, Canada is giving American firms access to billions of dollars in contracts by provincial governments and, in some cases, municipalities, federal government officials said.
The long-sought compromise is an agreement in principle but Trade Minister Peter Van Loan said Ottawa fully expects the provinces to approve the deal and the U.S. government is committed to implementing its part of the agreement, which will not require approval from the U.S. Congress. Read more here.
• Joint Statement on Canada-U.S. Agreement on Government Procurement (DFAIT)
• U.S., Canada make it official on Buy American (CTV News – Video)
• Ottawa hails Buy American deal (Globe & Mail)
• Protectionism ‘breakthrough’ reached (National Post)
• ‘Too little, too late’ on trade: Ignatieff (Globe & Mail)
Thursday, February 4, 2010
Harmonized System Update (HSU) 1001 was created on February 2, 2010 and contains 5,359 ABI records and 712 harmonized tariff records.
This update contains changes made as a result of the Committee for Statistical Annotation of Tariff Schedules, the 484(F) Committee.
CBP programmed in ABI the changes to the HTS that were approved by the 484(f) Committee and went into effect on 01/01/10. Among the changes approved by the 484(f) Committee was a request by the USDA (United States Department of Agriculture) to report milk solids content of dairy products in the kilogram unit of measure. Dairy related tariff numbers were modified to include an additional reporting unit of measure indicating ‘CKG’ (Content in Kilograms). The ‘CKG’ indication referred to the weight in kilograms associated with the milk solids content.
On January 27, 2010, the 484(f) Committee met once again and per their request, CBP removed these units of quantities from the affected records. The unit of quantity change is effective March 1, 2010, and the newly amended records are included in this update.
In addition, tariff changes associated with Annex II of the Jordan Free Trade Agreement, that included additional tariff numbers eligible for the Jordan Free Trade Agreement were made, effective January 1, 2010.
Finally, this update contains changes required by the verification of the 2010 Harmonized Tariff Schedule (HTS).
The modified records are currently available to all ABI participants and can be retrieved electronically via the procedures indicated in the CATAIR. For further information about this process, please contact your client representative. For all other questions regarding this message, please contact Jennifer Keeling via email at Jennifer.Keeling@dhs.gov.
The U.S. economy surprised everyone in the closing months of 2009. Preliminary figures show the economy churned out impressive 5.7% annualized growth. As the U.S. led the world into recession, it is expected to lead us out. Does the fourth-quarter, 2009 surge herald the beginning of recovery?
Although unusual, quarterly growth at this pace has been seen before, sometimes in the middle or close to the peak of an economic cycle. But in past U.S. experience, rapid quarterly gains often occur just after a period of recession – the recovery phase of the cycle – and have been known to last for 3-5 consecutive quarters. The timing seems to be right; is this burst of growth sustainable?
A quick scan of the sources of growth shows a varied picture. Inventory stabilization played a huge role, accounting for 60% of quarterly growth. This is a strong signal, indicating that the U.S. economy is returning to balance. However, consumer spending, a key engine of global demand, produced a lukewarm 2% gain, weaker than third-quarter growth and a sign that Americans are still moving forward with caution. In contrast, red-hot export growth added more to bottom-line GDP than all of consumer spending, although exports are just one-sixth the size of the US consumer sector. Read the complete article and/or watch the video here.
Efforts in place to mitigate congestion, but deliveries will take longer
The Vancouver 2010 Olympic and Paralympic Games will take over Vancouver and Whistler, British Columbia, from February 12 to March 21. There will be a massive influx of people and a corresponding spike in demand for goods, not to mention an array of unique items to be moved – bobsleighs, anyone? Plus, many roadways, particularly in downtown areas, will be closed to traffic.
The streets and highways feeding the Games will certainly be more congested than normal, but there are plans in place to ensure that the supply chains supporting the Games run smoothly. The City of Vancouver and other agencies have issued plenty of information about what shippers and carriers should expect. Read more here.
Scotiabank says Canada’s economy is on the road to recovery but the country will have to adjust to a world that has changed since the recent global financial crisis. The Canadian bank’s chief economist, Warren Jestin, says China and other emerging markets will provide a lot of the world’s future economic growth.
Jestin says Canada’s success in these markets will depend on identifying high-value products and services that can plug into global supply chains. He thinks a key source of Canadian job creation over the next decade will come from highly entrepreneurial small and medium-sized businesses.
Scotiabank also warns that governments cannot afford to use last year’s bailout of the auto sector as a model for supporting industries in crisis. Jestin says a winning strategy for government is to establish a competitive tax environment and what he calls a “world class” urban infrastructure.
A new report from Drewry Shipping Consultants reveals that only two of the carriers tracked in the financial stress index are operating above the “distress zone”. Drewry Shipping Consultants’ new Freight Shipper Insight provides up-to-date market information on demand trends, freight rate developments and macro-economic indicators specific to the ocean, air, rail and road freight sectors.
Read more here.
A new service was added to the WTO’s set of tools for finding out information on customs tariffs on 3 February 2010. The latest addition, “Tariff Analysis Online”, is the WTO’s most versatile so far. It includes the greatest available level of detail on the tariffs that WTO members have legally bound and the rates they are actually charging, summary import statistics, and the ability to analyse these interactively.
Tariff Analysis Online draws on two WTO databases: the Integrated Database (IDB) of tariff and import data, and the Consolidated Tariff Schedules, which contains WTO members’ commitments on tariffs and agricultural subsidies.
It provides users with flexible search criteria and produces a range of analytical reports – the results of the searches – covering both tariffs and imports, in detail and summary levels. Users can manipulate the analysis online and download and print the resulting reports.
The development of the new service is in line with the Market Access Committee’s decision of 13 July 2009 to make detailed information on tariffs available to the public.
The existing Tariff Download Facility is simpler and would be the service of choice for users looking for more basic information. It provides standardized statistical information on bound, applied and preferential tariffs on products defined in slightly less detail, by Harmonized System (HS) six-digit codes, with the ability to compare between countries swiftly.
A third service, the World Tariff Profiles, provides similar information to that of the Tariff Download Facility but for broader product categories.
Wednesday, February 3, 2010
The Department of Agriculture’s Food Safety and Inspection Service issued Feb. 2 a directive providing instructions to its import inspection personnel on performing label verification procedures when reinspecting imported meat and poultry products. LVPs are conducted to ensure that foreign establishments exporting these products to the U.S. adhere to the labeling requirements in the federal meat and poultry regulations.
Among the instructions provided by this directive are the following.
• Labels must be in English and mechanically printed, stenciled or stamped directly on the shipping container or on a self-adhesive label affixed to the shipping container.
• Shipping containers (e.g., boxes, bags, barrels, crates or other receptacles or coverings that contain fully labeled immediate containers) must be labeled with the name of the country of origin (preceded by “product of”), the establishment number assigned by the foreign meat inspection system and certified to FSIS, a unique shipping mark used to link the product to the foreign health certificate, and any applicable special handling statements. In addition, there must be sufficient space on the main and end panel for the U.S. mark of inspection. (This requirement is not applicable to product from Canada since the U.S. mark of inspection is applied to the health certificate and import application.)
• If shipping containers hold product packaged in immediate containers, those immediate containers must bear all of the mandatory label features, which include the name or a descriptive designation of the product, an ingredients statement (if needed), the foreign establishment number, any needed handling statements, the net quantity of the contents (if needed), the manufacturer’s or distributor’s name and address, any required nutrition labeling, the name of the country of origin (preceded by the words “product of”), and safe handling instructions for raw and partially cooked meat and poultry products that have not undergone further processing that would render them ready-to-eat and are destined for the consuming public.
Read more here.
Tuesday, February 2, 2010
1. This notice announces that the Canada Border Services Agency (CBSA) will be strengthening its commercial importation process respecting goods contaminated with soil.
2. Goods contaminated with soil are not admissible into Canada. The Canadian Food Inspection Agency (CFIA) is responsible for establishing the policy regarding the importation of goods contaminated with soil. The CBSA is responsible for administering and enforcing that policy to the extent it applies at the border.
3. Beginning February 1, 2011, non-compliant goods, i.e. goods contaminated with soil, arriving at the Canadian border will be restricted to a CBSA-controlled area and may be cleaned on-site by a mobile wash facility approved by the CFIA, provided certain conditions can be met, e.g. there is no risk of soil dislodgement during transport, operational capacity exists, availability of a CFIA-approved mobile wash facility. If a CFIA-approved mobile wash facility is not available, or if other conditions listed above are not met, the contaminated goods will be refused entry into Canada under the authority of the Plant Protection Act and the Health of Animals Act.
4. The costs associated with cleaning or removal from Canada will be paid for by the importer.
5. This strengthened approach is in line with the CBSA's existing commercial processes and procedures, as well as the CFIA's policy regarding the importation of foreign soil. It will further ensure that the CBSA maintains appropriate control over the contaminated goods, thereby preserving the safety and security of Canada and Canadians.
6. February 1, 2010 marks the launch of a twelve-month transition period culminating with the full implementation and enforcement of the strengthened process in 2011. This period will allow industry an opportunity to adjust their operations and ensure that goods arriving in Canada are clean and free of soil.
7. Under the current process, the CBSA may allow contaminated goods to be transported to either a stationary or mobile CFIA-approved treatment facility. However, treatment may only occur if certain conditions can be met, e.g. there is no risk of soil dislodgement during transport, operational capacity exists, availability of a CFIA-approved stationary or mobile wash facility. If the conditions listed above cannot be met, the shipment is refused entry into Canada and ordered removed at the importer's expense.
8. Inquiries and comments about this notice should be directed to:
Food, Plant and Animal Programs
Canada Border Services Agency
Telephone: 613-957-6868, Fax: 613-946-1520
Michigan Governor Jennifer Granholm is pushing to have international trade agreements properly enforced. The Democratic lawmaker told CNN’s “State of the Union” things have improved on that front since President Obama took office, saying it’s, quote, “overdue like a million jobs in Michigan overdue.”
She added other countries have been able to “beat the pants off us in this trade war.” Granholm called it “crazy” that the U.S. would have trade agreements that aren’t enforced and then enter into new ones that give advantages to other countries.
In his proposed US$3.8-trillion annual budget submitted to Congress on Monday, President Barack Obama is once again stressing job creation as a form of life support for the seriously ailing U.S. economy. […]
The seeming escalation of Buy American looms as negotiators from the U.S. and Canada are ensconced in 11th-hour talks revolving around a possible Canadian exemption from the protectionist provisions in the American Recovery and Reinvestment Act.
Rumours of an imminent deal have been swirling in D.C. in recent weeks, with whispers that Obama would use his executive power to deem that portions of the Canadian economy could be considered American since supply chains in both countries are so intrinsically entwined.
Yet it's unclear if a last-minute exemption from the recovery act would apply to any future Buy American provisions that could confront Canadian manufacturers in various pieces of legislation in the weeks and months ahead. Read more here.
Related: Canada braces for fallout as Barack Obama unveils budget (Toronto Star)
China accused the United States of protectionism that has “seriously affected” their trade ties, state media reported late Monday, amid a worsening spat between the two countries.
Ministry of Commerce spokesman Yao Jian made the comments on the ministry’s web site in response to US moves to impose anti-dumping duties on electric blankets and wire trays from China, news agency Xinhua said.
“Since the outbreak of the financial crisis, the US trade protectionism has been apparently on the rise, and China has become the biggest victim of US abuse of trade relief measures,” Yao said, according to Xinhua. Read more here.
Related: Five Political Risks to Watch in China (Reuters)
Monday, February 1, 2010
The Trade Compliance Office (Client Services) from Winnipeg offers Customs information seminars for small business entrepreneurs who may be importing/exporting commercial goods. This seminar is an introduction to the Customs commercial import and export procedures featuring Philippe LeQuere of the Canada Border Services Agency.
Date: February 2, 2010 — 1:00 PM - 4:30 PM
Canada/Manitoba Business Service Centre
250 - 240 Graham Ave., Winnipeg, Manitoba
Phone: 984-2272 or 1-800-665-2019
Click here to register for the event.
The Buffalo Sabres today announced a new partnership with the Peace Bridge Authority (PBA) to create more public awareness of the NEXUS program. To make this program more user friendly for hockey fans, the NEXUS lanes entering Canada have now had their hours extended by the Canadian Border Services Agency (CBSA) following all Sabres home games, and will continue to do so during the 2011 World Junior Championship in Buffalo.
“An efficient, smooth flowing border is critical to the prosperity of the binational region and organizations like the Buffalo Sabres that add so much to the quality of life in this area,” said Anthony Annunziata, Chairman of the Peace Bridge Authority. “The CBSA is to be commended for their commitment to improve the functionality of the border, and to ensure that not only Sabres games but also major events like the World Junior Championship can be attended and enjoyed without the border being an impediment.” Read more here.
Related: Sale of 10 acres set to extend Customs (Watertown Daily Times)
U.S. Manufacturers Report Compelling Evidence of Evasion of Antidumping Duties on Imported Steel Wire Products
$84 million annual loss to U.S. Treasury, negative impact on jobs documented
A coalition of U.S. manufacturers has compiled compelling evidence that certain companies subject to antidumping orders are costing the U.S. Treasury at least $84 million annually due to their deliberate evasion of the antidumping duties. In addition, more than 275 jobs have been lost in the innerspring and hanger industries alone, and additional jobs are threatened by these ongoing schemes to avoid antidumping duties. The information is being presented to Members of Congress, the U.S. Department of Commerce, and U.S. Customs and Border Protection to seek stronger enforcement of existing antidumping orders that are designed to maintain a level playing field for U.S. manufacturers and their workers.
The Coalition for Enforcement of Antidumping and Countervailing Duty Orders consists of several U.S. manufacturers of steel wire products, including steel nails, uncovered innerspring units, steel wire garment hangers, and carbon steel threaded rod, each of which separately petitioned the U.S. Government for relief from unfairly traded imports. Each of these industries, after nearly two years of proceedings before the International Trade Commission and the Department of Commerce, established that foreign companies were selling these products in the U.S. at less than fair value and that these sales were materially injuring U.S. industries; subsequently, Commerce issued antidumping duty orders that levied import duties on these items, in some cases up to 234%, as a way to remedy the injury caused by dumped imports. Read more here.
President’s budget proposal adds 2.3 percent for both departments
Initial figures for fiscal 2011 indicate that the departments of Transportation and Homeland Security will be marking time financially in fiscal 2011, in keeping with President Obama’s promise last week to freeze the budget as a deficit-reduction measure.
The bottom-line numbers published Monday for both departments show a 2.3 percent increase over fiscal 2010, which barely keeps up with inflation. According to the Bureau of Labor Statistics, the Consumer Price Index grew 2.7 percent in 2009; the Producer Price Index grew 4.4 percent. Read more here.
In times of crisis, good news is no news. Iceland’s meltdown made headlines; the remarkable stability of Canada’s banks, not so much.
Yet as the world’s attention shifts from financial rescue to financial reform, the quiet success stories deserve at least as much attention as the spectacular failures. We need to learn from those countries that evidently did it right. And leading that list is our neighbor to the north. Right now, Canada is a very important role model.
Yes, I know, Canada is supposed to be dull. The New Republic famously pronounced “Worthwhile Canadian Initiative” (from a Times Op-Ed column in the ’80s) the world’s most boring headline. But I’ve always considered Canada fascinating, precisely because it’s similar to the United States in many but not all ways. The point is that when Canadian and U.S. experience diverge, it’s a very good bet that policy differences, rather than differences in culture or economic structure, are responsible for that divergence.
And anyway, when it comes to banking, boring is good. Read more here.
Related: With banks timid about lending, small businesses have turned to unconventional lenders like Hartsko Financial Services, which provides high interest short-term loans to small and midsize companies. Read more here.