Customs Can Search all Files on a Laptop, U.S. Court Rules

(Sci-Tech Today)

The Ninth Circuit Court of Appeals has ruled that U.S. Customs and Border Patrol officers can open every file on a laptop without cause. The court said laptops arriving at international airports are subject to border rules. The lawyer for Michael Arnold had some creative arguments, but the court didn’t buy them.

Business travelers carrying laptops into the U.S. from overseas may be in for a rude experience. The Ninth Circuit Court of Appeals ruled Monday that U.S. Customs and Border Patrol officers can search laptops — including opening every file on the hard drive — without any reasonable suspicion.

The decision in United States v Arnold by a three-judge panel reverses a U.S. District Court decision that said such searches require reasonable suspicion.

The case concerns Michael Arnold, who arrived at Los Angeles International Airport from the Philippines and was pulled aside by customs agents for a random laptop Relevant Products/Services search. When the officers started up the computer they found two folders on the desktop labeled Kodak Pictures and Kodak Memories.

When they found photos of nude women in those folders, they spent several hours opening multiple files until they found images of child pornography. They seized the computer and two weeks later obtained a warrant. A grand jury charged Arnold with breaking federal child-pornography laws.

In its ruling, the Ninth Circuit held that international arrivals at U.S. airports are subject to the same rules as border crossings. Those rules give customs officials broad leeway to conduct searches of anything a traveler brings into the country. The international terminal of a U.S. airport is the “functional equivalent of a border,” the court said, citing the U.S. Supreme Court case of Almeida-Sanchez v. United States.

In arguments before the court, Arnold’s lawyer, Marilyn Bednarski, had a creative argument to get around the presumption that border searches are reasonable. Computers are “an extension of ourselves,” she told media outlets this week. “It really is like looking into someone’s mind, rather than looking into a box or a folder or a purse.”

In other words, Bednarski argued, laptops are actually an extension of our bodies. That argument is based on a Supreme Court holding that there is at least one limit to border officers’ ability to search at will. In a 1985 case, United States v. Montoya de Hernandez, the Supreme Court ruled that officers do need reasonable suspicion to search the alimentary canal because “the interests in human dignity and privacy which the Fourth Amendment protects forbid any such intrusion on the mere chance that desired evidence might be obtained.”

The appeals court didn’t buy that argument.

Bednarksi also argued that the laptop was the equivalent of one’s home, since it potentially contains digital versions of all the images and documents traditionally kept in the home. In another 1985 case, California v. Carney, the Supreme Court ruled that not even a mobile Relevant Products/Services home is accorded the same privacy interest as an actual home since it is “readily movable.” A laptop is even more movable than a mobile home, the court noted.

International travelers uncomfortable with having their laptops searched might want to consider storing files online and renting a laptop when they get to their destination country, or encrypting their files if they do travel with a laptop.

“It’s so easy to encrypt your files, passing through any spot where you are liable to be searched with sensitive data unencrypted seems brain-dead,” one person posted on a blog.

Bush on Free Trade & Exports

(U.S. Chamber of Commerce)

President Bush, speaking today at the U.S. Chamber Small Business Summit, on the slowdown in the economy, free trade agreements and the importance of exports and trade to economic growth.

EU Issues Annual Report on U.S. Barriers to Trade and Investment

The European Union recently issued its 2007 report on U.S. barriers to trade and investment. The report examines a wide variety of obstacles encountered by EU exporters and investors in the U.S. Many of the complaints listed in the report are similar to those included in the 2005 and 2006 editions. Some of these complaints are described below. It should be noted that while some of these grievances may not be applicable in the case of Canadian exports where goods originate in the NAFTA region, many of them, particularly in terms of non-tariff barriers do have similar relevance.

Textile Duties
According to the European Commission, high tariffs make the U.S. one of the most difficult export markets for EU textiles and apparel. EU industry considers that U.S. tariff peaks constitute a very harmful barrier because they are focused on very competitive products. In addition, specific duties apply for a wide range of textile products.

Labeling Rules
Extensive product description requirements complicate EU textile exports to the U.S. and result in additional costs. Rules are burdensome for marking and labeling retail packages to clarify the country of origin, the ultimate purchaser in the U.S. and the name of the country in which the article was manufactured or produced. Furthermore, there are requirements relating to the typology/physical characteristics of clothing labels (given size, font used, etc.). These standards are different than those in the EU, meaning that special labels are needed for the U.S. market.

Customs Requirements
Customs formalities for imports of textiles, apparel and footwear to the U.S. require the provision of particularly detailed and voluminous information, which lead to additional costs and in some cases include confidential processing methods (type of finishing, dyeing, etc). In addition, the liquidation period of up to 210 days is too long. Given the short life span of apparel products, the retailer or importer is often not in a position to re-deliver the goods upon U.S. Customs and Border Protection’s request, in which case CBP applies a penalty equal to 100 percent of the value of the goods.

Rules of Origin for Textiles
European companies reportedly face difficulties with U.S. rules of origin for certain textiles, especially scarves, bed linen, table linen, bedspreads and quilts containing cotton and wool. For these products, the country of origin is still the country of origin of the fabrics, even if the fabrics have been dyed and printed and have undergone two or more finishing operations in the EU. Therefore, the producers of these products have to label their products with the country of origin of the fabric, which does not reflect the work of design and the production process performed in Europe.

SAFE Port Act
The EC, EU member states and the European trade community in general are seriously concerned about this legislation, especially the potential costs of the 100 percent scanning requirement and its possible impact on EU competitiveness and transatlantic trade flows. The report notes that the implementation of such a requirement in more than 600 ports from which ships leave for the U.S. would lead to major trade disruptions and an additional administrative burden, requiring major restructuring of EU ports and placing a very heavy financial burden on EU businesses and taxpayers. Other requirements included in the SAFE Port Act (e.g., standards for container security and/or smart box technology) are also looked upon with trepidation because they have the potential to negatively impact the competitiveness of EU suppliers.

Container Security Initiative
CSI screening and related additional U.S. customs routines are causing significant additional costs and delay to shipments of certain EU products. In August 2005, the U.S. agreed to the participation of more EU ports in the CSI where they comply with certain jointly agreed minimum standards and where no U.S. officials will be stationed. For this project, a pilot action was performed in 2007 in the port of Szczecin (Poland). Similar actions are planned in Aarhus (Denmark) and Salerno (Italy) this year.

User Fees
The EC argues that the Merchandise Processing Fee is likely to exceed the cost of the service provided at the port since it is based on the value of the imported good.

“Buy American” Berry Amendment
The fiscal year 2006 defense authorization act contains changes to the Berry Amendment that expand the coverage of the Amendment’s Buy American provisions. The new language requires the Department of Defense to notify Congress within seven days if it awards a contract to a foreign manufacturer and to place the contract on a General Services Administration Web site. The new provisions also expand the coverage of the Berry Amendment by requiring that components of textiles and apparel are also made in the U.S. In addition, the bill contains a provision mandating training programs for DOD personnel about the Berry Amendment. According to the EC, these provisions will hamper the DOD’s flexibility in applying the Berry Amendment by opening waiver decisions to continuous challenge by the domestic textile industry.

EU Certificates of Origin
The EC claims that the U.S. does not recognize the EU as a customs union, which effectively means that EU certificates of origin are not accepted by CBP.

Extraterritoriality
The EC continues to oppose the extraterritorial aspects of certain U.S. legislation, including the Cuban Liberty and Democratic Solidarity Act (a.k.a. the Helms-Burton Act) and the Iran Freedom Support Act. The EC is also concerned about the extraterritorial provisions of the Patriot Act.

A copy of the complete report can be downloaded here (PDF format).

Border Guards Frustrated

(Sun Media)

Canadian customs agents working without a contract

The union representing Canadian border guards says its members are frustrated they’ve been working almost 11 months without a contract.

As talks to reach a deal resume in Ottawa today, a member of the border guards’ bargaining team says union and management negotiators are heading toward "an impasse.”

While there were reports of a work-to-rule campaign by customs agents at border crossings, traffic appears for the most part to be flowing well into Canada from the U.S.

“I’m getting calls and so is (the) president of Niagara Falls (branch) that the members have taken upon themselves to do some job action,” said Dave VanHelvert, a member of the bargaining team for the Customs and Excise Union.

Traffic entering Niagara Falls was backed up onto the Rainbow Bridge. Drivers crossing at Fort Erie endured a slight back up, but continued to move through the border point.

Wage proposals are expected to be presented when talks resume today, VanHelvert said.

“This June, it will be a year without a contract so people are getting kind of upset,” said VanHelvert.

Government of Canada and Western Provinces to Negotiate New Economic Development Agreements

(Western Economic Diversification Canada)

The Government of Canada and the four western provinces are negotiating new Western Economic Partnership Agreements (WEPAs) that will help stimulate economic growth, expand the knowledge economy, and modernize infrastructure to create jobs and new opportunities for western Canadians.

The joint federal and provincial investment of $200 million over five years was announced in Banff today [Friday] by the Honourable Rona Ambrose, President of the Queen’s Privy Council for Canada, Minister of Intergovernmental Affairs and Minister of Western Economic Diversification.

The announcement was made by Minister Ambrose during a meeting with all her provincial counterparts responsible for economic development and science and technology in Western Canada.

“These negotiations for new Western Economic Partnership Agreements demonstrate our government’s commitment to working in cooperation with the provinces,” said Minister Ambrose. “These flexible agreements are a productive federal-provincial collaboration that promote economic diversification, strengthen economic activity and improve the quality of life across the West.”

Under the agreements, the federal government provides funding of $25 million for each western province. The federal investment is matched by $25 million from each of the provincial governments, providing a total $50 million in funding for each province to address specific regional challenges.

“The strong relationship that has developed between Manitoba and Canada as a result of Economic Partnership Agreements has, over the years, provided numerous economic development opportunities for communities throughout Manitoba,” said Andrew Swan, minister of Competitiveness, Training and Trade. “Continuing the agreement means a stronger economy and further investment in the province.”

“I look forward to working with the federal government to create a Western Economic Partnership Agreement that will facilitate economic development in British Columbia,” said Hansen. “We have seen some great successes with the projects developed under this program in the past few years, and we look forward to continuing this partnership between governments.”

“Saskatchewan’s economy is on a roll and WEPA is helping to strengthen our key sectors and provide businesses with more tools to succeed in the knowledge-driven global marketplace,” Minister of Enterprise and Innovation, Lyle Stewart said. “The agreement has been a very effective and valuable tool in stimulating economic development and because of it important initiatives will be funded.”

“Alberta’s drive to diversify its economy benefits from the flexibility of the Western Economic Partnership Agreements,” said Honourable Doug Horner, Minister of Advanced Education and Technology. “Our priority is to expand Alberta’s knowledge-based economy and promote technology commercialization opportunities through targeted strategies and programs to develop talented people, help local companies grown, and attract investment, entrepreneurs, and high-tech companies to Alberta.”

The new series of agreements will build on the success of previous WEPAs, which have invested $180 million in the shared economic priorities of the federal and provincial governments. A recent evaluation of the prior agreements, which expired on March 31, found they have effectively advanced innovative projects and leveraged significant additional financial investment from non-government sources.

Details of the agreements will be finalized in the coming weeks.

Getting a Grip on NAFTA

(Vancouver Sun)

Christopher Jones, VP of Public Affairs, Tourism Industry Association of Canada

The U.S. presidential primaries have provoked debate there and in Canada about reopening the North American Free Trade Agreement.

As this political fracas subsides, perhaps calmer heads can prevail to address the more obvious shortcomings in the current approach to Canada-U.S. border and trade relations.

The lack of leadership on NAFTA has created a vacuum that threatens the largest bilateral trading relationship in the world. The arrival of a new administration in Washington could help correct the original failure to develop the supranational institution required to regulate the flow of people and goods between NAFTA member states; to detect, anticipate and respond to emerging commercial, infrastructural, environmental and security challenges, and to resolve disputes in a final and binding manner.

I propose the creation of a North American Border and Environmental Agency (NABEA).

NAFTA came into force in 1994, creating a free-trade area, providing “national treatment” to each others’ investors, guaranteeing energy access and providing dispute resolution panels with debatable results.

However, in areas relevant to tourism, forestry, agricultural exports and safety, and transportation, the agreement continues to give preference to national policy and domestic bureaucracies.

The result? A prolonged and damaging dispute over softwood lumber; the lengthy exclusion of Canadian cattle from U.S. markets; the imposition of documentation and travel requirements under the Western Hemisphere Travel Initiative (WHTI) to the detriment of the Canadian tourism sector; the creation of the U.S. Secure Flight Program, which will require Canadian air carriers to submit passenger manifests to the U.S. 72 hours before departure of flights that may not even land in the U.S. (in contradiction of the 1944 Chicago Convention on Civil Aviation and Canadian privacy laws.)

Many of these policies required costly litigation, endless lobby campaigns in Washington, and immense expenditures of Canadian political capital, time and effort over the past 15 years, often to little or no avail.

By contrast, the Treaty of Rome, which created the European Economic Community in 1957, mandated a supranational commission made up of member-state appointees whose primary loyalty is to the EEC (now the European Union) and its founding objectives: Harmonious economic development activities; continuous and balanced expansion; increasing stability; rising standard of living, and closer relations between member states. The European Commission plans, integrates and coordinates member-government policies in trade, transport, environment and other fields to the EU's collective benefit. Read the complete article.

Exchange Rate Bargains in the US

(Bloomberg News)

Lured by the cheap dollar, overseas travellers are slowly drifting back to the United States following a long exile that began after the Sept. 11, 2001, terrorist attacks. Overseas visits to the U.S. jumped 10 per cent in 2007, and the trend appears to have accelerated this year as foreigners hunt for bargains in New York, Boston and elsewhere.

Global Food Price Hikes

(CNN & New Zealand TV3 News)

Rising gas and dairy prices are obvious signs of the global rush for commodities, wheat and rice are also on the rise. In some of the world’s poorer countries shortages and high prices have combined to provoke disorder, and closer to home retailers are starting to feel the pressure.

Ontario Exports to Decline in 2008 and Remain Flat in 2009, Says EDC Forecast

(Export Development Canada)

Ontario’s exports are expected to decline 7% in 2008 and rise a lukewarm 1% in 2009, according to the Global Export Forecast released today by Export Development Canada (EDC).

“Ontario’s exports will be battered this year by the high Canadian dollar and eroding U.S. sales,” said Peter Hall, Vice-President of Economics and Deputy Chief Economist. “Ontario is exposed to weakness in the auto sector and sliding demand for industrial goods. Both sectors are also impacted by the soaring currency.”

The auto sector accounts for 37.2% of Ontario’s international exports. Light vehicle sales in the U.S. are anticipated to reach no more than 15.0 million units in 2008, following average sales of 16.7 million units over the 2003 to 2006 period. The bleak outlook for auto sales has already led to production cutbacks in Ontario, with total vehicle output down 24% in January relative to only a 2.2% decline in U.S. production and an increase of 21% in Mexican production. As a result, EDC expects motor vehicle exports to decline 9% in 2008 before posting mild growth of 3% in 2009.

The industrial goods sector accounts for 30.5% of Ontario’s total exports. The U.S. economic downturn will also act to curb demand for this sector, with a projected decline of 9.5% in 2008 and 2.5% in 2009.

Although EDC expects 2008 to be a challenging year, the evolving global supply chain presents opportunities for Ontario exporters, particularly manufacturers of high value-added intermediary and final goods. Mexican light vehicle production has been rising steadily over the years and presents an opportunity for auto parts suppliers. Technical agricultural machinery and mining equipment are in strong demand in developing countries such as Russia and Ukraine, among other emerging markets. The ongoing infrastructure work and development of China’s industrial base also presents opportunity for exporters, not just resource exporters, but also producer-exporters of construction and industrial M&E.

Canadian exports are forecast to decline by 2% in 2008 before posting slight growth of 2% in 2009. Nationally, Canadian economic growth is forecast to decline to 1% in 2008 with a slight upturn to 2.3% in 2009. Internationally, EDC is forecasting a 3.8% growth rate in 2008 and 2009. EDC’s Global Export Forecast is available here.

CBS MoneyWatch

Microsoft’s drop in profits has investors worried; lawmakers want President Bush to pressure OPEC to increase production; and home mortgage interest rates are rising.

U.S. House Speaker Meets with Canadian Politicians about Trade, Traffic

(The Canadian Press)

U.S. House Speaker Nancy Pelosi is getting involved in problems at the Canada-U.S. border. She met this week with Canadian politicians worried about trade and traffic tie-ups at the border.

Conservative MP Rob Merrifield says Pelosi agrees there should be a study this summer on ways to speed up commerce. It will likely result in a plan that could be used by the next U.S. administration.

Merrifield, co-chairman of the Canada-U.S. Inter-Parliamentary Group, says Pelosi is concerned about the impact of delays on jobs and tourism.

Pelosi, a Democrat, is the most powerful politician in the House of Representatives.

The group also talked with several U.S. legislators about anti-NAFTA campaign rhetoric from the Democratic contenders. Senator Jerry Grafstein said many agreed the rhetoric about renegotiating the deal has become extreme.

Related: Pelosi approves study of Canada-U.S. border tie-ups.

Border Security ‘Dumb’ and Costly, Chamber of Commerce Chief Tells Americans

(Financial Post – Eric Beauchesne)

Americans are shooting themselves and Canadians in the foot with their array of security measures at the Canada-U.S. border, according to the head of the Canadian Chamber of Commerce.

They are not only adding to the costs of doing business across the border, and putting at risk millions of jobs on both sides, but are actually undermining the security of the U.S., Perrin Beatty says in a prepared speech to be delivered Thursday to the North Carolina Technology Association in the state capital Raleigh.

“Indeed, mis-allocating security assets to the 49th parallel can actually make North America less safe, as it takes away badly-needed resources from other priorities,” Beatty said, urging a shift from random searches to a more intelligence-based system of security that used new technologies and systems to identify risky cargo and individuals.

“This approach will be far more effective in finding terrorists or potentially dangerous cargo than random searches or simply spreading the same resources indiscriminately over a much broader base,” he said.

Meanwhile, Beatty said the current border security measures are hurting both Canadian and American businesses, in what is a closely integrated North American economy, while giving offshore competitors a cost advantage.

“For example, automobiles built in North America may cross the border six or seven times in various stages of production, each time attracting costs resulting from compliance or from delays,” he said, adding that those costs add several hundred dollars to the price of a North American made vehicle.

“In contrast, cars imported from overseas attract these costs and delays only once,” he noted.

“This means that, as a direct result of government policy, we are discriminating against products manufactured in North America and in favour of those produced abroad at a time when the North American industrial base is under unprecedented pressure,” he said.

“Economists have a word for this – ‘dumb,’” he added.

A recent report by the Canadian and U.S. chambers of commerce and more than 40 other organizations recommended a string of short-term measures to promote the flow of cross-border traffic, including such basic suggestions as ensuring adequate staffing at border crossings and speedier clearance of pre-certified low-risk shipments and people.

However, the situation is getting worse not better, Beatty said in an interview Wednesday in advance of delivering the speech.

“There are more delays, it’s getting more costly,” he said, noting that line-ups of vehicles trying to cross into the U.S. at one Ontario-Michigan border crossing have gotten so long that provincial authorities had to put up portable toilets on the provincial highway leading to the bridge. Read the complete article.

Three Amigos: Defending NAFTA

(Reuters News)

Leaders from the US, Canada and Mexico all defended the NAFTA deal as good for all parties.Democratic contenders Hillary Clinton and Barack Obama blame the 14-year-old North American Free Trade Agreement for manufacturing job losses. They say the United States could quit the pact unless Canada and Mexico agree to major changes.

Canadian Economy Stalling as Exports Hit Hard: Bank of Canada

The Canadian economy has largely stalled as a result of the worsening credit crunch and the slumping U.S. economy that has robbed manufacturers of their traditional market, the Bank of Canada says.

The assessment in the central bank’s quarterly monetary report gives a clearer understanding of what the bank’s governing council was weighing Tuesday when it slashed its key interest rate by half a percentage point to three per cent.

After predicting in January that an upturn would begin this quarter, the bank now says Canada has entered an economic flat spot with growth in the current quarter barely above recessionary levels at a 0.3 per cent annualized rate, and won’t recover fully until 2010.

The bleaker outlook for the economy comes amid other potential bad news for Canadian consumers:

• CIBC World Markets predicted Thursday that national average gasoline prices, now about $1.23 a litre, will top $1.40 this summer and $2.25 by 2012 as crude oil prices continue to soar and reach US$225 a barrel in four years.

• The country’s largest bread maker, Canada Bread Co. (TSX:CBY), warned that consumers can expect to pay more for bread, bagels and other flour-based products after a 32 per cent drop in first-quarter profit amid “significant margin compression due to rising wheat prices.”

But Bank of Canada governor Mark Carney said Canada won’t fall into recession thanks to the relatively strong internal economy buttressed by oil and mineral exports and the record number of Canadians who have jobs.

“The decline in exports ... is counterbalanced and in our view more than counterbalanced by the strong domestic demand,” he said.

Still, Carney noted that the bank will likely have to put more stimulus into the economy over and above the 1.5 percentage points it has cut from the overnight rate since December.

Part of the reason is that tight credit conditions have increased the cost that the chartered banks pay for capital, causing them to pass on only a portion of the central bank’s stimulus to businesses and individuals in the form of lower borrowing costs.

Slow Progress, Frustration Mark SPP Summit

(Embassy – Michelle Collins)

Experts say the North American Security and Prosperity Partnership has become its own worst enemy.

As North American leaders wrapped up the fourth annual Security and Prosperity Partnership leaders’ summit in New Orleans yesterday [Tuesday], concerns over its lack of progress are being raised.

From the business community, in the form of a North American Competitiveness Council report, there was a sense of disappointment in the progress made on priorities, along with a near-urgent call directed at political leaders to strengthen North America’s competitiveness

While the NACC, comprised of representatives from some of the biggest and most powerful companies on the continent, reported that progress has been slow on several of the priorities, such as emergency management, integrating auto sector regulations and the implementation of enhanced driver’s licenses, it described the trilateral framework as essential for all three counties’ economic success.

Despite the frustrations raised, the report concluded by urging a new U.S. administration to continue to seek progress on the SPP priorities and called for cooperation to “turn around public misperceptions” that threaten to make the issue of North American competitiveness largely irrelevant.

In the past couple of weeks leading up the New Orleans summit, the lack of progress being made through this trilateral forum has contributed to a growing debate in Canada about the value of meeting with both the leaders of Mexico and the U.S. to address such a wide range of issues.

While trilateral engagement has its place for discussing common issues such as the environment, the problems of competition, trade and the challenges of the Canada-U.S. border are better suited to bilateral talks, said former Canadian ambassador to the U.S. Allan Gotlieb. With so little achieved on the dozens and dozens of priorities initiated by the SPP, Mr. Gotlieb said, it’s become difficult to bring on any real momentum.

“So admirable as its purpose is, one has to say it’s been quite disappointing in its results,” Mr. Gotlieb said. “Trilateralism should continue, but the Canada-U.S. relationship needs to be reinvigorated by bilaterals, and the flagship for doing that is the prime minister with the president.”

University of Ottawa professor Roland Paris said a lack of momentum for the SPP can be attributed to the lack of an overarching vision, particularly when it comes to the Canada-U.S. relationship.

“Some of the items are useful, the issue of regulatory co-operation, for example,” Mr. Paris said. “But there are larger issues about what the next steps will be for our relations with the U.S. and for North America. Without a vision of a goal to strive toward together, a vision that is driven and articulated by political leaders, this kind of work-a-day agenda is not likely to provide the momentum to move forward.” Read the complete article.

Bush: Anti-trade Message a 'Throw-away Political Line'

(Associated Press)

President Bush criticizes those opposing trade agreements, defending their use. He also blasts the speaker of the House for holding up an agreement with Colombia. The comments came at a meeting with the heads of Canada and Mexico.

McCain Gets Lesson in Free Trade: Area Executives Emphasize Benefits of Forming Pacts

(Milwaukee Journal Sentinel)

It did not take long Wednesday for Sen. John McCain to get a handle on how business executives felt about free-trade agreements.

A day after the all-but-certain Republican presidential nominee announced his plan for economic reforms, he addressed about 300 business people gathered at Bucyrus International, the South Milwaukee manufacturer of mining equipment.

At the event, held in a cavernous facility used to build some of the world’s largest machines, McCain was told that it would be a mistake for the U.S. government to back out of trade deals such as the North American Free Trade Agreement.

Tariffs and protectionist measures would backfire on the United States and hurt U.S. companies engaged in international trade, according to a panel of executives that McCain addressed. “If we don’t have free trade, the decision that we made to stay here in South Milwaukee and triple the capacity of this plant is lost,” Bucyrus CEO Tim Sullivan told McCain.

Worldwide demand for coal and other mined resources has fueled a construction and hiring boom at Bucyrus, which is now several years into an economic upswing that some analysts believe could last for years. Bucyrus spent more than $42 million on expansions and renovations in South Milwaukee in 2007 and has more than doubled its employment since $150 million in expansion plans were announced three years ago.

Bucyrus and its Milwaukee competitor, Joy Global Corp., are part of the fast-growing economies of Asia and eastern Europe. Trade agreements have helped fuel international equipment sales. It would be “absolutely crazy” to dismantle the agreements, Sullivan said.

McCain emphasized his support for NAFTA and said that 50% of the oil used in Wisconsin comes from Canada under the agreement. “Canadian government sources have been quoted as saying if there’s a unilateral renegotiation of NAFTA by the United States, then they would obviously consider their options to send their oil to wherever the highest market value would be,” McCain said.

Small Businesses Prove to Be Resilient Despite Difficult Market Conditions

(Business Development Bank of Canada)

Drawing on data from its loan portfolio and its experience with its 27,000 entrepreneur clients, the Business Development Bank of Canada (BDC) has found that to date small business is generally managing to cope with the effects of a strong Canadian dollar and turbulence in the financial markets. This is one of the conclusions BDC reaches in the first issue of its new Entrepreneurial Insight newsletter.

"Small businesses and especially manufacturers make up much of BDC's loan portfolio. Thus the state of our portfolio could be a good barometer of the health of SMEs and the Canadian economy," says Jérôme Nycz, Vice President, Strategy & Planning. "Our loan portfolio is relatively stable and solid. The number of clients having temporary or permanent difficulties in repaying their loans remains low and has changed very little in the past three years. Although 2008 is far from over and we are continuing to monitor the situation closely, so far we have seen that entrepreneurs are very resilient and most can adjust to market conditions."

However, BDC has also found that market conditions are having more impact on manufacturers. Nearly half of the BDC loans that have deteriorated (i.e. are unlikely to be repaid) were granted to manufacturers. Manufacturing exporters, particularly those whose exports to the United States make up 40% or more of their sales, are the most vulnerable.

“SMEs that moved into export markets in recent years were betting on the proximity and ease of trading with the United States,” Mr. Nycz explained. “Because of their generally lower productivity, the rapid increase in the value of the Canadian dollar and fierce global competition, SME manufacturing exporters who relied too heavily on the U.S. market are suffering the consequences today.”

Although they account for only 4.2% of Canadian SMEs, manufacturers make up 26% of BDC’s clients. To help them adjust to market conditions, BDC recently offered its eligible clients the option of postponing principal payments on their loans for six months.

”We know that manufacturers who navigate through these difficult waters successfully are those that have developed clear business strategies so that they are ready to seize opportunities on national and international markets. By offering them this financial respite, we wanted to give our entrepreneur clients the leeway they need to review their business plans and export strategies and look at ways to improve productivity,” Mr. Nycz explained.

CNN-Lou Dobbs: New Orleans SPP Talks

A harsh critic of NAFTA and the Security and Prosperity Partnership (SPP), as well as the purported “North American Union” (NAU), CNN pundit Lou Dobbs reports on the talks being held in New Orleans between the leaders of the US, Canada and Mexico.

Teamsters’ Hoffa Blasts NAFTA, Praises Obama

(Pittsburgh-Tribune)

International Brotherhood of Teamsters General President James Hoffa blasted NAFTA as the result of “corporate greed” that shows “total disregard for workers” during a visit with the Tribune-Review...

The Teamsters chief was in Pittsburgh visiting work places to drum up support for presidential candidate Barack Obama, whom the union endorsed on Feb. 20. The stop was part of Hoffa’s “Working Class Convoy for Change” tour of several Pennsylvania cities…

Hoffa faulted the North American Free Trade Agreement for sending U.S. jobs to Mexico and overseas, while allowing tainted food and products with leaded paint to be imported from China.
“(Obama) is the best for organized labor,” said Hoffa, citing the U.S. senator's support of reform of strikers’ rights laws and his opposition to NAFTA.

Rising Cost of Fuel Takes Toll on Transport Sector

(Transport Intelligence)

Rising fuel prices are having an impact right across the spectrum of transport activity. Companies ranging from road freight operators to airlines are being driven out of business in all major markets throughout the world.

In the UK, for example, the latest freight company to call it a day is Ramage Distribution, a well-known Scottish-based road freight carrier. Last week, management called in accountants KPMG to act as receivers. Some 350 jobs have been lost at depots throughout the country, with just a handful of staff retained to help the company in administration.

The crash of the company comes only months after Ramage reported that its acquisition of Scottish haulier UFD in mid-2007 had “knocked millions off the combined annual overheads of the enlarged operation, almost tripled turnover and left the company primed for expansion in 2008”. Its subsequent problems have been blamed on rising overheads, mainly fuel.

Such problems are not confined to the UK where at least truckers currently don’t have to cope with a major economic slowdown. In the U.S., truckers are faced with a combination of record oil prices and dropping volumes, particularly in the construction/housing industry. Anecdotally, it is the independent truckers which are facing the worst crisis, being unable to pass on the full costs of fuel to their employers. Fuel surcharges are being dropped as competition for the dwindling number of loads gets increasingly intense.

The airline industry is another major victim. U.S. discount air carrier ATA Airlines Inc recently collapsed, blaming high fuel costs although that situation was made worse when FedEx dropped ATA from a military-charter programme it operates for the Department of Defense.

In total, five U.S. airlines have gone bankrupt in the last two weeks. Champion Air, Skybus, ALOHA Air Group and Frontier Air have all entered some form of administration, with credit lines increasingly difficult to maintain. It is not just in the U.S. where airlines have been driven beyond the brink. Last week, Hong Kong-based OASIS went bust.

There is concern that as airlines attempt to raise prices to make up for the increasing cost of fuel, passenger numbers will fall, thus exacerbating the situation and leading to mounting company failures. This will have a knock-on effect in the air cargo market, with reduced capacity inevitably impacting on freight rates.

Bloomberg Economic Outlook: April 14, 2008

(Bloomberg News)

U.S.and U.K. consumer-price inflation, the ZEW survey of German investor confidence and the Beige Book, the Federal Reserve’s survey of U.S. regional economic activity, are among the highlights for the week of April 14. This report includes comments from European Central Bank President Jean-Claude Trichet, Confederation of British Industry Director General Richard Lambert and Michael Cuggino, president of the Permanent Portfolio of Funds.

ACE Portal Reports Dictionary

(CBP)

A reference guide designed to enhance the understanding of reports for ACE users, to assist in identifying the report that best fulfills a particular business need, and to encourage the overall use of the reporting tool. .. This version of the ACE Portal Reports Dictionary contains a detailed description of the most frequently accessed reports. All are in PDF format.

• Dictionary for Participating Government Agencies (133 pages)
• Dictionary for Brokers (276 pages)
• Dictionary for Carriers (54 pages)
• Dictionary for Importers (281 pages)

EC: Industry Urged to Pre-Register All Chemicals by 1 December 2008

(CIFFA e-Bulletin)

Some 30,000 chemicals currently in use (e.g. acids, metals, solvents, surfactants, and glues) have to be pre-registered at the European Chemicals Agency (ECHA) between 1st June and 1st December 2008. As the new chemicals legislation REACH (Registration, Evaluation, Authorisation and restriction of Chemicals) will enter into operation on 1st June, the European Commission and ECHA are alerting companies of their obligations. Tens of thousands of manufacturers or importers of chemicals will have to pre-register chemicals in 2008 if they want to continue manufacturing or importing them without interruption. It has been estimated that over 180,000 pre-registration files will be submitted. The pre-registration process will enable companies to share data on their chemicals and paves the way to enhanced knowledge about chemicals. This is a prerequisite for improved safety in the years to come.

Today's alert is driven by the concern that some companies may still not be conscious of their obligations, either because they are not aware of the scope or the specific requirements or because they believe that REACH does not affect them, especially if they are not part of the chemicals sector. The Commission therefore calls upon Member States authorities, industry, third countries and other stakeholders to help to make the obligations known to all enterprises concerned. More information is available from in web-streaming format and at the European Chemicals Agency website.

TSA Pilot Testing Industry Air Cargo Inspection Program

(World Trade Interactive)

The Transportation Security Administration is currently pilot testing in nine U.S. cities a program that allows certain private sector facilities to screen air cargo that originates in the U.S. and is loaded onto passenger planes. The Certified Cargo Screening Program is designed to help the TSA meet a statutory requirement to implement a system to screen 50% of such cargo by February 2009 and 100 percent by August 2010. Phase 1 of the CCSP is now underway in San Francisco, Chicago, Philadelphia, Atlanta, Dallas, Los Angeles, Miami, New York and Seattle.

According to a TSA information bulletin, the CCSP enables certified cargo screening facilities to screen cargo prior to its acceptance by a freight forwarder or air carrier. Third-party logistics providers, manufacturing facilities, warehouses and distribution facilities may apply to become a CCSF if their facility directly tenders cargo to a forwarder or carrier. Freight forwarders are also eligible to apply.

Although participation in the CCSP is voluntary, the TSA is advocating it as a way for shippers to ensure timely delivery of their cargo. The TSA states that the requirement for 100% screening, which will eliminate current exemptions and alternate means of screening for shrink-wrapped, strapped and banded pallets, is expected to cause “significant air cargo handling delays at airlines where all screening is currently performed.” The CCSP, on the other hand, provides a mechanism by which industry can (a) achieve 100% screening without impeding the flow of commerce, (b) continue to ship certain cargo types without potential invasive screening and related fees later on in the supply chain, and (c) continue to shrink-wrap consolidations and build bulk configurations.

Click here for the complete article.

Miliband & Mandelson: The EuroMed Vision

Video: Foreign Secretary David Miliband has suggested the European Union should work towards including Russia, Middle Eastern and North African countries. In his first major speech on the UK’s relationship with Europe, he said the EU would not become a “superpower” but should be a “role model” for the world.

Address by EU Commissioner Peter Mandelson at the First Agadir Investment Forum:
Every effective political relationship has to be driven by a vision: a sense of where you want to go and why it matters. For Europe and the countries of the Southern Mediterranean that vision has always been very strong. We call it the “Barcelona process,” but it is more than just a process. It is a shared history and geography, a shared sense that we are united by our common interests in a changing and globalising world.

President Sarkozy is just the latest in a long line of European leaders who have looked to the Mediterranean with a sense of excitement and hope. There are many different expressions of that, but the idea of a free trade area of the Mediterranean by 2010 has always captured my imagination, just as it has captured the imagination of others.

In the last decade we've made it more than an idea. We have Association Agreements in place that have opened EU markets to your goods. These agreements have made a real difference. They have doubled your trade with the EU over the last decade and cut your trade deficit with the EU by half. They have helped Southern Mediterranean countries create jobs and attract investment. We are slowly pushing forward with liberalising services and making it easier to set up businesses in both directions.

Yet I often sense disappointment from countries of the Southern Mediterranean that the EuroMed process is not producing the gains they expected – or at least not fast enough. This is especially true in terms of foreign direct investment. The conditions look superficially good: being on the EU's doorstep, and having preferential trading conditions with the EU are huge competitive advantages.

But despite their closeness to Europe and their promising growth, the countries of the Southern Mediterranean have attracted only 1% of EU foreign investment since 2000. Investors will go where conditions for business are favourable, where there is certainty for their investments and where there is a market for their goods. They might see potential in the region, just as I do. But we have not yet convinced them in great enough numbers to put their money where their aspirations are. Read the complete speech.

Exporters Seeking More Risk Management

(Stephen Poloz, Export Development Canada)

Canadian exports rose by an unimpressive 1.4% in 2007. Even so, with the Canadian dollar riding high and the slowdown that emerged in the U.S. economy, it could have been worse. In the circumstances, exporters tapped into EDC’s services like never before.

EDC facilitated over $77 billion in export and international investment transactions during 2007, an increase of 17.5% compared with 2006. This is very rapid growth, especially given the slow pace of export growth overall. There were several reasons for this.

First, Canadian companies are increasingly investing abroad in order to break into new foreign markets, or to develop global supply chains - in short, in order to globalize their operations. Investing abroad is riskier than ordinary export sales, and requires a lot of capital.

Accordingly, EDC is regularly asked to participate in such transactions, often in partnership with banks. EDC can help to meet a shortfall in financial capacity, or can bring political risk insurance to the table so that more private sector participants will come forward. EDC facilitated $5.9 billion in new Canadian investment abroad in 2007, more than double the amount in 2006.

Second, although Canadian exports overall rose by only 1.4% in 2007, exports to emerging markets grew by 14%. Leading export destinations were Algeria, Brazil, China, India, Russia and Saudi Arabia, but transactions were supported in some 183 markets worldwide. Sales to emerging markets are generally perceived to carry a greater risk of non-payment than sales to major economies, leading exporters to make greater use of accounts receivable insurance.

Third, exports have not been weak across all sectors. There has been good growth in aerospace, telecom equipment and in equipment sales related to agriculture, mining and energy. These sectors have traditionally been relatively heavy users of EDC’s services. There has also been good growth in foreign infrastructure projects, which EDC often participates in so as to encourage procurement from Canada, particularly of engineering and construction services.

Fourth, EDC expanded its program for certain sectors that were under considerable stress in 2007. Notable among these were the auto parts sector, and the pulp and paper sector.

How does all this feed back into Canada? Every transaction that EDC facilitates must have demonstrable economic benefits for Canada. We estimate that the transactions facilitated by EDC in 2007 helped to generate 4.5% of Canada’s GDP, and helped sustain some 624,000 Canadian jobs.

The bottom line? Exporters were hit by a number of negative shocks in 2007, making it natural for them to make increased use of EDC’s risk mitigation tools. In 2008, we are expecting to see even more international risk, but even softer export performance at the same time.

China Overtakes Japan as Canada’s Third Largest Export Market in 2007

Canada further diversified its trade portfolio last year, as overseas advanced largely on the strength of growing trade with Britain, Norway and China.

Statistics Canada says overseas exports continued five years of growth, rising 17.4% last year, but Canada’s merchandise trade surplus nevertheless fell to its lowest level since 1999.

Merchandise exports increased 2.1% to $465.2 billion, while imports rose 2.8% to $415.8 billion; Canada’s annual merchandise trade surplus with the world fell to $49.5 billion.

Countries other than the United States represented more than a fifth of Canada’s export market in 2007.

Exports to China were responsible for nearly 20% of the total growth in Canada’s exports in 2007, as China overtook Japan as the country’s third-largest export market.

Imports from countries other than the United States also rose to more than 45% of Canada’s total imports last year, largely due to growth in shipments from China and Mexico.

In total, Canada’s merchandise imports and exports reached record highs in 2007 following the rapid appreciation of the dollar, the housing slowdown in the United States, and rising energy prices spurred by the soaring price of crude oil.

Summary data, and a link to the report, are on the Statistics Canada website.

Commerce Secretary Gutierrez Discusses CAFTA

(National Association of Manufacturers)

Congress will hurt the U.S. economy and send a bad message to its allies if it rejects a free trade agreement with Colombia, Commerce Secretary Carlos Gutierrez says. The House on Thursday voted to delay a vote on the deal.

“We should not put politics in front of sending a message to an ally,” said Gutierrez, a guest on this week's “America's Business with Mike Hambrick” radio program. “If we don't approve this, our allies and friends will be very confused. And people who don't like us will be very happy.”

Gasoline prices are at record highs and the search for alternative energy sources is gaining urgency. America's Business will talk to Southern California Edison about the utility company's multi-million-dollar plan to light hundreds of businesses and homes using solar power.

American manufacturers are also using a foreign visa program to help meet a shortage of qualified workers. Texas Instruments will join Mike to discuss the hurdles the company faces when it uses the H1-B visa program.

Behind the Dreadfully Named Mini-scandal NAFTAgate and Other Nonsense

(Robin Sears – Hill Times)

It took a passing remark from Prime Minister Harper’s chief of staff, Ian Brodie, in a budget lockup discussion with a few reporters, to set off the firestorm that became NAFTAgate.

The pharaohs did it. English kings do it. Every government does it. Let’s all do it, let’s fall in love ... with bashing foreign trade. Second only to a war abroad as the best distraction from problems at home, the most venerable political device for a candidate or a government in trouble is to blame wicked foreign traders for domestic economic ills.

The Rosetta Stone records that the good pharaohs defended the interests of local business over foreign traders. The Magna Carta required English kings to respect the tariff rights of local barons over foreigners. And American governments from George Washington to George W. Bush have succumbed to trade bashing when it served a short-term domestic agenda. In Bush’s case, attacking foreign steelmakers so outrageously, in order to protect Republican mid-term election prospects and America’s failing local producers that he nearly launched a two-front trade war with Europe and Asia.

Canadians were players at this “beggar thy neighbour” game for most of our history, but we seem to have given up the addiction. Sadly, we may have swapped fighting trade skirmishes with the Americans for complacency about the protections that NAFTA delivers from their America-firsters. The foolishness of that complacency is starkly revealed by the proposed “sale under duress” of MacDonald, Dettwiler’s Canadarm and related space assets to American investors—a painful prospect for further consideration below.

U.S. Democratic presidential candidates were at it again this spring. This time foreign traders became NAFTA beneficiaries. No one much noticed or cared when John Edwards and Bill Richardson were blaming NAFTA for American economic woes this past winter. Dick Gephardt and Paul Tsongas had made many of the same shopworn populist attacks on the inimical impact of free trade in the first Bill Clinton election in 1992. Clinton the First had the wit and the gravitas not to fall into the trap they set for him among worried working-class Democratic voters.

Sadly, Hillary Clinton has shown none of the same smarts as her husband, nor has Barack Obama. Both have committed to a level of NAFTA attack that will humiliate them in office, and do little to get them there. Campaigning in the Rust Belt states where steel, auto and manufacturing jobs have been decimated, it is easy and cheap politics to assuage the angry unemployed by blaming foreigners. It has little to do with economic reality, however, and even less to do with NAFTA. Canada-U.S. trade has boomed since its passage.

Even in Ohio, where Clinton and Obama descended to populist insults against each other and “disloyal companies,” trade with Canada has grown much faster than either the local economy or their trade with anyone else. Read the whole article.

Emerson and Provincial and Territorial Representatives United on Canada’s Trade Priorities

(DFAIT)

The Honourable David Emerson, Minister of International Trade and Minister for the Pacific Gateway and the Vancouver-Whistler Olympics, recently met with provincial and territorial representatives to discuss Canada’s current trade agenda and the status of the World Trade Organization (WTO) negotiations.

“Canada is recognized as a world-class trading nation, but we need to keep up with global competition,” said Minister Emerson. “Today, we agreed to continue working together to build new commercial relationships, improve conditions for business and investors, and increase market access for Canadian goods, services and talent around the world.”

Minister Emerson outlined key elements of the Global Commerce Strategy, the federal government’s blueprint for strengthening Canada’s competitiveness in global markets. Canada has one of the most successful and prosperous economies in the world. The Strategy lays the foundations for a stronger, more competitive position in global markets by providing tools to help Canadian business tap into global value chains and adapt to today’s ever-changing international markets.

Canada benefits greatly from its strong commercial links with the United States and the many advantages that the North American Free Trade Agreement affords. Being part of the largest free trade zone in the world puts Canada on a unique footing with its competitors. The North American partnership remains central to the federal government’s strategy for ensuring a strong and prosperous Canadian economy.

At the meeting, ministers benefited from a valuable exchange with Michael Wilson, Canada’s Ambassador to Washington, on the subject of a strategic approach to addressing common objectives with the United States. They also had the opportunity to consider ways to maximize the advantages of the North American platform and deliver results for business and citizens.

Ministers discussed Canada’s relationship with the European Union and a study under way that examines the benefits of strengthening our economic ties. Launched by leaders at the June 2007 Canada-EU Summit, the study covers a wide range of bilateral trade and investment issues. Ministers expressed optimism that Canada and the EU can achieve a more extensive commercial partnership.

Minister Emerson provided an update on the current Doha Development Round of WTO negotiations and led a frank discussion about Canada’s position in the negotiations. Ministers reaffirmed their unanimous support for a successful outcome.

“Canada will continue to nurture its existing relationships and promote its ambitious trade agenda to increase prosperity for Canadians across the country,” added Minister Emerson. “I am pleased that my provincial and territorial counterparts expressed support for our bilateral and regional trade agenda, and for developing stronger commercial partnerships in the Americas, Asia and Europe.”

PM Announces Tougher Food and Product Safety Legislation to Protect Canadian Consumers

(Office of the Prime Minister)

Prime Minister Stephen Harper [Tuesday] announced the federal government will boost protection for Canadian consumers with a tough and comprehensive overhaul of food and product safety laws. Earlier in the day, the government tabled legislation in the House of Commons designed to improve the safety of food, consumer, and health products in Canada.

“Today’s action on consumer safety is good news for Canada. It will improve our safety and our health, make Canadian brands more competitive among global consumers, and boost confidence at home as a country whose product safety standards are second to none,” said the Prime Minister.

The legislative package proposes amendments to the Food and Drugs Act as well as a new Canada Consumer Product Safety Act. The changes include a crack down on negligent manufacturers, importers and retailers who knowingly endanger their customers. Public access to information about product safety would also be improved, giving Canadians more control over their own health protection.

Other highlights of the legislation include:

• A general prohibition against the manufacture, importation, advertisement or sale of consumer products that are a danger to human health or safety;

• A requirement of mandatory reporting by suppliers of serious product-related incidents – including near-misses and defects, allowing for more targeted oversight;

• Dramatically increased fines for violations; and

• A new power for the federal government to order recalls of unsafe consumer products.

“Good for consumers. Good for the economy. This announcement is a double win for all Canadians,” concluded Prime Minister Harper.

The Food and Consumer Safety Action Plan here and the proposed amendments to the Food and Drug Act are summarized here.

Some Truth About Trade

(NY Times Editorial)

There’s nothing like international trade to help bridge the nation’s ideological divide. As Barack Obama and Hillary Clinton travel the Rust Belt, the Democratic candidates seem to be eschewing the advice of their economic advisers and turning to Karl Rove’s playbook.

It was Mr. Rove who urged Dick Cheney in 2000 to forget the free trade spiel and promise voters in West Virginia that a Bush administration would protect American steel from cheap imports. “If our trading partners violate our trade laws, we will respond swiftly and firmly,” Mr. Cheney thundered.

Those words seem to echo in Mr. Obama’s attacks against “unfair” trade deals — including Nafta, Cafta and President Bill Clinton’s decision to establish regular trade relations with China. Mrs. Clinton seems to draw inspiration as well, railing to the Pennsylvania A.F.L.-C.I.O. against alleged dumping of Chinese steel: “When I’m President, China will be a trade partner not a trade master,” she said.

Such pandering may play on the stump, especially in Pennsylvania, where workers fear for their jobs as the country’s manufacturing base shrinks. Mr. Bush won West Virginia, only the fourth Republican to do so since 1932. Still, whoever wins in November would be foolish to choose protectionism.

Democrats need to tell voters the truth: First, trade is good for the economy, providing cheap imports and markets for exports, spurring productivity and raising living standards. And second, while trade can drive down some wages and displace some jobs, Democrats have real ideas to help workers cope. Mrs. Clinton and Mr. Obama should base their approach on these ideas. They would not only make sound policy, they would also provide a competitive advantage over John McCain.

Fortunately, presidents don’t have as much power on these matters as candidates claim. When President Bush put stiff tariffs on imported steel in 2002, he infuriated European allies and then had to lift the tariffs when the World Trade Organization declared them illegal. Read the complete editorial.

Canada Should Launch New Bilateral Trade Initiative with the US: C.D. Howe Institute

Canadian trade policy is preoccupied with yesterday’s priorities: bilateral trade agreements with minor partners and multilateral negotiations that provide scant benefit, while ignoring pressing problems in Canada’s most important trading relationship. Tempting as it is to blame the political caution of a minority government and wait for political fortunes to change, the problem is deeper and of longer standing. Canadian trade policy has become detached from its economic moorings.

Canada needs a trade policy that recognizes the increasing importance of global value chains, and the critical role of Canada-US commercial and regulatory integration in gaining full benefit from their exploitation, according to a study released today by the C.D. Howe Institute. In Navigating New Trade Routes: The Rise of Value Chains and the Challenges for Canadian Trade Policy, leading trade policy authorities Bill Dymond and Michael Hart argue that Canadian trade policy is at sea, and needs to reflect the new realities of international trade. They conclude that Canada needs to move decisively to pursue a bilateral initiative with the United States and outline the components of the initiative, including a new border regime, a joint regulatory agenda, and the creation of the institutions and decision-making procedures required to implement it. Download the report (PDF format).

Launch of Britain’s new unified Border Agency

Border, immigration, customs and visa checks will be united from today in the country’s new UK Border Agency, the Home Office has announced.

The new UK Border Agency, established as a shadow agency of the Home Office, will protect our borders, control migration for the benefit of the country, prevent border tax fraud, smuggling and immigration crime and implement quick and fair decisions.

The new 25,000 strong organisation includes more than 9,000 warranted officers operating in local communities, at the border and across 135 countries worldwide, with wide ranging search, seizure and detention powers.

Over the next four months 1,000 frontline staff will be conferred with both immigration and customs powers and staff in England and Wales will be equipped with police-like powers as set out in the UK Borders Act 2007. A full merger will follow new legislation presented to the House in the autumn.

The UK Border Agency will link with the 3,000 police stationed at ports and airports following a new agreement with the Association of Chief Police Officers. Talks are continuing on closer integration.

Announcing the launch of the Agency, Home Secretary Jacqui Smith said:

“The UK Border Agency will help strengthen protection of our border. With tough customs, immigration and police-like powers UK Border Agency officers will be better equipped than ever to guard our ports and airports, protecting the country from illegal immigration, organised crime and terrorism.

“This 25,000 strong force will work both at home and abroad to tackle smuggling of people and goods into Britain using intelligence, new technology and wide-ranging powers and I am confident it will help strengthen policing at the border.

“Already taxpayers can see our investment in new technology paying off and creating a ring of security around Britain. Fingerprints are now being taken from all visa applicants to the UK, this year we will increase police, customs and immigration checks against visitors travelling through our ports, and we will see the roll-out of ID cards for foreign national from November.”


Tough targets were announced for the new agency in its business plan published today. They include targets to:

• expel 5,000 foreign national prisoners from Britain this year, up from 4,200 last year;

• sustain last year’s increase in the seizure of class A drugs by seizing at least 2,400 kilograms of cocaine and 550 kilograms of heroin by April 2009;

• increase by 50 per cent the number of asylum cases concluded in less than six months;

• extend the UK’s visas regime to cover a larger proportion of the world’s population; and

• increase detention capacity by 20 per cent over the next two years to help increase the number of immigration offenders we can remove from the country.