News

Port of Montreal Update

Published on Monday, July 26, 2010 at 9:06:00 AM EDT by CrossBorder Solutions Inc.

excerpted from today's CIFFA enewsletter

 

Montreal Port Authority (MPA) Welcomes Agreement Reached Friday

 

The MPA welcomed the agreement reached Friday between the Maritime Employers Association (MEA) and its longshore labour force allowing work to resume at the Port of Montreal’s terminals. The MPA also welcomed the announcement of the resumption of talks on renewal of the collective agreement, and hopes that the parties quickly agree on this issue to ensure that the Port of Montreal can continue its long-term development. The Montreal Port Authority was not party to the conflict and regrets the inconveniences that this situation caused to users of port services, shippers and their customers. It will do everything in its power to get things back to normal fast and ensure the shipment of all cargo currently in the Port. Following this back to work agreement, here is the situation at the Port of Montreal as of Friday July 23rd:

 

The terminals affected by the labour dispute were scheduled to resume operations on Saturday at

8:00 am (although this was delayed until Sunday morning). All rail traffic has resumed. Construction work continues. Vessels that were diverted and not unloaded in another port are en route back to the Port of Montreal. The Port entrances at Berri, Viau and Hector-Barsalou streets remain open. The other entrances will gradually reopen.

Montreal Dockworkers Return to Work

Published on Friday, July 23, 2010 at 9:58:00 AM EDT by CrossBorder Solutions Inc.

excerpted form todays CIFFA enewsletter

The Port of Montreal shut down since Monday morning by an employer lockout of longshoremen, will reopen for work at 8 a.m. Saturday following a compromise agreement reached Thursday evening reports the “Journal of Commerce”. The union for the 850-plus longshore workers agreed to stop their no-overtime and work-to-rule stances, and the employers agreed to withdraw their refusal to guarantee job security and pay for 107 of the workers identified in the expired 2005 employer-union labour contract. The two sides had met in morning and afternoon sessions with a federal mediator. The agreement still must be approved by a general assembly called for Friday morning, but union spokesman Sebastien Goulet said there was no doubt it would be ratified.

In an interview, Gilles Corriveau, a spokesman for the Montreal branch of the Maritime Employers Association, said the two sides agreed “there will be no pressure tactics by either side.” The agreement, he said, will last until a mid-October target date for the Syndicat des debardeurs, local 375 of the Canadian Union of Public Employees and the MEA to reach a new labour contract. The previous contract signed in 2005 expired at the end of 2008.

Corriveau said each side had agreed to withdraw “pressure tactics” during contract talks that will resume Monday morning, aided by a federal negotiator. Goulet said details of Thursday’s agreement would be disclosed after union members voted on them, but he agreed there had been “compromise on both sides.” The standout issue between them is the job security and pay guarantee program for the 107 workers, Corriveau said. He said both parties agree that the program itself is worth keeping to ensure loading and unloading of ships round-the-clock, but the MEA wants to cut the numbers radically.
 

PORT OF MONTREAL LOCK OUT - UPDATE

Published on Wednesday, July 21, 2010 at 9:52:00 AM EDT by CrossBorder Solutions Inc.

excerpted from today's CIFFA enewsletter

Here is what we (CIFFA) know as of Tuesday evening.

After talks between the union (CUPE) and employer (MEA) ended Sunday with no resolution, on Monday morning (July 19) the Maritime Employers Association locked out all longshore workers at the Port of Montreal. Basically all operations have come to a stop with the exception of grain

CN and CP have both advised that they are no longer accepting any containers bound for the Port of Montreal until further notice. There is currently no train service available into or out of the Port of Montreal.

The Port of Montreal issued an update on Tuesday (20th) as follows:
- The Montreal Port Authority has obtained an injunction. This injunction basically seeks to allow work to continue on infrastructure projects unrelated to the employees of the Maritime Employers Association.
- The Maritime Employers Association is maintaining its lockout.
- There are no incidents to report.
- The road entrances to the Port are being picketed by members of the Longshoremen’s Union
- Freight car movement to and from the Port has been suspended.
- Rail traffic inside the Port has been suspended.
- There is no vessel requiring the work of longshoremen for its operation in the Port
- The grain terminal can receive and ship bulk cargo.
- Cargo in the terminals is not being handled.

Agents for the lines and carriers themselves have not been commenting on the situation but Port officials said redirections to New York and Norfolk are expected. (One of the problems with diverting vessels to the U.S. is of course lack of AMS clearance. Additional costs will also be incurred for any diversions to other ports.)

Vessels are at anchor in the St. Lawrence River, awaiting developments.

Halifax Port Authority spokeswoman Michele Peveril said in an interview Monday that "There is a potential that cargo may need to move through Halifax and the port can handle the extra ships”. (But with the current difficulties in securing bookings outbound from Halifax and the shortage of railcars to Halifax, that begs the question as to how CN, the only rail line servicing Halifax, could accommodate this surge in container traffic.)

CIFFA has written to the Honourable Ms. Lisa Raitt, Federal Labour Minister, urging the government of Canada to take action to get the Port of Montreal working. In the meantime, Ms. Raitt has urged the MEA and the union to resume talks and, in a statement, said the federal government is monitoring the situation closely. There is currently no indication of when the two sides might resume talks although it is understood that meetings are scheduled for Thursday and Friday of this week.

If the lockout lasts only a few days it is assumed that vessels will not be diverted to other ports due to all the technical, legal and financial costs involved. In short, the steamship lines have not communicated their decisions yet regarding diversions and one might expect not to hear until after the meetings on Thursday and Friday.

If the lockout last longer, it is assumed that vessels currently waiting at anchor or enroute to Montreal will be diverted to other ports. Each carrier will have its own diversion plan and hopefully will communicate with the community sooner than later. Shippers should be made aware that any of the above diversions would create additional costs for shipments (rail, drayage etc.) and that additional costs, storage or demurrage already caused by the lockout will be for the cargo.
 

HST - How it Effects Customs & Freight services

Published on Wednesday, July 7, 2010 at 10:00:00 AM EDT by CrossBorder Solutions Inc.

 

The Harmonized Sales Tax (HST) is a value-added tax which combines the provincial sales tax (PST) of the five participating provinces with the Federal Goods and Services Tax (GST). Effective July 1, 2010, the provinces of British Columbia and Ontario will replace their provincial sales taxes with a single HST. CANADIAN PROVINCES WITH HST Nova Scotia                     13%     Increasing to 15% July 1, 2010  New Brunswick             13%  Newfoundland             13% British Columbia            12%    Ontario                              13%

          

Click here to view the PDF file for this article.

G8 & G20 Commerical Transport Restrictions

Published on Friday, June 18, 2010 at 10:27:00 AM EDT by CrossBorder Solutions Inc.

 excerpted from today's CIFFA e newsletter

 

Transport Canada, the RCMP-led Integrated Security Unit, Public Safety Canada and all of its participating agencies would like to remind Canadians and industry stakeholders that special aviation, marine; rail and transportation of dangerous goods regulations come into force next week. These security requirements are designed to protect and safeguard the general public, delegations and diplomats during the G-8 and G-20 summits period.

Aviation Safety and Security - Aircraft operators intending on operating in the general area surrounding the G-8 and G-20 summits are advised that there will be airspace restrictions for the duration of the summits. The restriction will be in effect from June 24 to June 26, 2010, for the Huntsville area and from June 26 to June 28, 2010, for the Toronto area. Air operations in the restricted zones will be limited. Additional details on the G-8 and G-20 Summits Airspace Restrictions are available by visiting www.tc.gc.ca/eng/ontario/page-1859.htm#aviation.

 

Transportation of Dangerous Goods - From June 21 to June 28, 2010, the transportation of certain dangerous goods will be controlled into, through and within a zone that encompasses the G-20 meeting venues in and around downtown Toronto. The goal of the temporary requirements is to promote the safety and security of the public and world leaders, dignitaries and participants at the G-20 meetings. Law enforcement agencies and transportation of dangerous goods inspectors will be enforcing this interim order, as well as all other requirements established under the Transportation of Dangerous Goods Act and its regulations during the event. This interim order will expire on June 28, 2010, at 6:00 a.m. ET. A copy of the Interim Order can be found at: www.tc.gc.ca/eng/tdg/g20-controlledaccesszones-1090.htm.

To view a map of the affected areas, please visit: www.tc.gc.ca/eng/tdg/g20-controlledaccesszones-zone1-1091.htm.

 

Rail Security - Transport Canada issued a notice on June 9, 2010, to federally regulated railways operating within the G-8 or G-20 security zones during the summits, requiring them to carry out the railway transportation security measures in relation to their operations. Law enforcement agencies and railway safety inspectors will be enforcing these security measures, as well as all other requirements established under the Railway Safety Act and its regulations during the events.

 

Marine Security - Enhanced security zones will be in force from June 24 to June 27, 2010, and include security perimeters from 30 to 300 metres around critical infrastructure, including ferries and ferry facilities operated by the City of Toronto, the Toronto City Centre Airport and the Toronto Port Authority. For additional information and to obtain maps of the affected areas, please visit www.tc.gc.ca/eng/ontario/g20marine.htm

 

 

European Skies Head Back to Normal

Published on Friday, June 18, 2010 at 10:12:00 AM EDT by CrossBorder Solutions Inc.

excerpted from todays CIFFA online newslettter

Airlines resumed services across Europe on Wednesday, with most scheduled flights going ahead reports the “BBC”. Eurocontrol said it expected about 22,500 flights to have taken place on Wednesday, out of a normal weekday total of 28,000. "It is anticipated that almost 100% of air traffic will take place in Europe" on Thursday, the agency added. At London's Heathrow airport, Europe's busiest, traffic ran at 90% normal service on Wednesday. Many night flights are being allowed temporarily to help clear the backlog of stranded passengers. Transatlantic services have returned to their normal level, with 338 flights arriving in Europe on Wednesday, Eurocontrol also said. Denmark, Norway and Sweden - among the countries previously worst affected by the ash cloud - have now lifted the last of their bans. Some airspace restrictions remain over Finland and some remote Scottish isles.

Lufthansa said it would fly at full capacity by operating about 1,800 flights on Thursday, up from about 700 on Wednesday. Air France said its long-haul flights are now departing as normal, although services in parts of northern Europe remained suspended.

Air Canada said that operating schedules remain subject to change; they planned to operate many of their scheduled flights to and from Europe on Wednesday including London, Frankfurt, Munich, Paris, Geneva, Zurich, Rome and Tel Aviv.

AF-KLM Cargo advised that following the gradual reopening of European airspace, they have resumed operations in a phased manner. All intercontinental flights to and from Amsterdam and Paris on Wednesday 21 April were to be operated. The carrier was also working on shipping all cargo already accepted at their hubs as soon as possible. Status of shipments can be found on their online tracking tool at www.afklcargo.com. Cargo acceptance has been fully resumed at their hub in CDG, Paris. Also all outstations in Europe and worldwide are open for cargo acceptance and their hub at SPL, Amsterdam, will be open for cargo acceptance as of Thursday April 22, 06:00 local time.

Singapore Airlines also announced that with the progressive opening up of European airspace, the carrier will be reinstating flights to and from Europe as of Wednesday. These include operations to London Heathrow Airport. Check their website for further details.

British Airways said it was bound to take some time before they could restore their full flying programme. They were looking to operate all long haul flights departing from Heathrow and Gatwick on Wednesday, April 21 2010. Due to the current backlog of cargo already within British Airways World Cargo facilities across their network, priority will be to fly cargo already on hand.
Customers will need to check local schedule and restrictions with their local British Airways World Cargo customer service teams.

As a reminder large backlogs of cargo have accumulated over the past 6 days which carriers are working to move to their destinations. There is also the challenge of repositioning aircrafts and crews. The backlog and limited capacity will most likely continue to impact airfreight shipments moving to, from and through European airspace for the near future.

 

EU Ministers Agree to Gradually Open Air Space

Published on Tuesday, April 20, 2010 at 8:43:00 AM EDT by CrossBorder Solutions Inc.

excerpted from todays CIFFA online newsbulletin

European Union transport ministers agreed on Monday to gradually ease restrictions in place in European airspace since the Icelandic volcano started hurling ash into the atmosphere reports the “Financial Post”. A source at the presidency of the EU said an area immediately around the volcano would remain closed and that ministers had proposed the "progressive and coordinated" opening of airspace in a second zone further from the volcano. Germany's Transport Minister said Monday that complete closure of German airspace has been lifted. The minister says European countries have agreed to open airspace step by step.

In a separate report by the “BBC”, Transport ministers said there would be a core no-fly zone, another zone open to all flights and a third "caution" zone, allowing some flights. The move came as the UK, Germany, the Netherlands, France and Belgium said they would begin to reopen airspace. Britain's air traffic control body said airspace in Scotland, parts of the north of England and Northern Ireland would reopen on Tuesday.

Lufthansa, meanwhile, was allowed by the German aviation authority to operate 50 long-haul flights to Frankfurt, Munich and Dusseldorf. France said it would reopen Lyon airport later on Monday, before opening air corridors for flights between Paris and southern French cities, and eventually all its other airports. Some passenger flights were to be allowed to leave Schiphol Airport in Amsterdam from Monday night. Belgium said it would begin reopening the country's air space on Tuesday morning. Several European airports have already reopened - including those in Austria, Estonia, Finland, Hungary and Turkey, after authorities there decided there was no longer any risk from the ash cloud. But Italy's civil aviation authority has shut the country's northern airspace until Tuesday morning. In Spain, where all airports were open, the government offered to let Britain and other European countries use its airports as stopovers to get passengers moving again.

 

Exporters struggling to get Vessel space

Published on Monday, April 5, 2010 at 5:55:00 PM EDT by CrossBorder Solutions Inc.

excerpted from todays Canadian Sailing online magazine 


?The pace of the recovery has caught shipping lines with too much capacity in mothballs, and they may not even recover by the summer, Mr. Gobeil said. Canadian exporters and freight forwarders are fuming over a serious shortage of export container shipping capacity that’s threatening exports of machinery, agri-food products, minerals and lumber, he said.

“The situation is a disaster,” Mr. Gobeil said. “I’ve been in this business for 35 years and I’ve seen nothing like it. It’s out and out blackmail.”

The shipping lines are using the capacity shortage to force up rates, which are at or higher than 2008 levels, Mr. Gobeil said. But without enough ships in service, the lines aren’t cashing in. That action makes Mr. Gobeil doubt the sincerity of statements from the carriers that they’re working to correct the situation.

Ted Chazin, supervisor of claims and special projects with Milgram International Shipping, of Montreal, says the Canadian economy is recovering quickly from last year’s recession on the basis of strong international demand for Canadian products. But he said it can take eight weeks to get a slot on a container ship.

“That delay means we’re not as competitive as overseas rivals,” Mr. Chazin said. “The carriers are really rationing space.”

Trying to find out what’s happening is complicated because the carriers “are not really being clear on what they’re doing,” he said.

The Canadian International Freight Forwarders Association has been trying to raise the alarm about the situation. It has gathered reaction from its members across the country and their comments echo those of Messrs. Gobeil and Chazin.

CIFFA executive director Ruth Snowden said the situation is much like the headaches American exporters face. “The lack of export capacity is in some instances causing foreign buyers to go elsewhere,” she said. “Shippers are in a position to lose orders and the situation is becoming very serious for our economy.”

The issue has yet to attract much attention but she wonders, “How can a sophisticated and experienced trading country like Canada accept such an intolerable decline in service to export customers?”

In a recent bulletin to its members, CIFFA included the contents of a letter from Maersk Line CEO Eivind Kolding. He said shippers and ocean carriers alike are “experiencing an instant change in the market” that has led to volatility and made business-as-usual impossible.

“We realize that this abrupt change in market conditions has not been managed well by us in all instances, causing undue problems, for which we apologize,” he wrote. “A particular challenge has been an extraordinary amount of overbookings on many of our sailings,” he said, promising to find ways to alleviate the problems.

He suggests it could take to the summer for the situation to right itself because lines are afraid of bringing too much capacity online.

Mr. Gobeil said shippers are being hit with late delivery charges because containers often wait in Montreal, Halifax and Vancouver for weeks before being loaded onto a ship. And then they might wait for a few more weeks in a transshipment port before being delivered.

 

GDP up for 5th Straight Month

Published on Thursday, April 1, 2010 at 9:31:00 AM EDT by CrossBorder Solutions Inc.

excerpted from Canadian Business Online, Mar. 31, 2010

OTTAWA - The stalwart Canadian economy marched doggedly forward in January, growing faster than anticipated thanks to a healthy boost from a manufacturing sector that appeared to be in full rebound from the recession.

The month's 0.6 per cent rise in real gross domestic product, reported Wednesday by Statistics Canada, was the biggest one-month lift in more than two years and just ahead of an economist consensus forecast of 0.5 per cent.

"The Canadian recovery is becoming more fully entrenched and is showing surprising strength, with the goods-producing sector in full rebound mode," Douglas Porter, deputy chief economist for BMO Capital Markets, wrote in a note to clients.

"Importantly, the recovery looks to be broadening beyond the initial push in housing and consumer spending, as manufacturing has advanced for five straight months."

The solid improvement will likely put more pressure on the Bank of Canada to raise interest rates in the next couple of months from their historic lows of 0.25 per cent.

Goods-producing industries grew 1.3 per cent, largely on the strength of manufacturing and construction, the agency said. After a 1.2 per cent gain in December, manufacturing was up 1.9 per cent in January, with 17 of 21 major groups advancing.

The construction sector advanced 1.7 per cent, on a four per cent increase in residential construction and a one per cent rise in engineering and repair work. Non-residential building construction bucked the trend, falling off a slight 0.5 per cent.

"These are unambiguously strong results, with GDP now rising at a whopping 6.9 per cent annual pace over the November-to-January period," Porter said.

"And, the economy has already recouped more than half of its recession losses, with GDP now up by 2.7 per cent from last May's low."

The loonie rose following the announcement, moving up 0.43 cents to 98.52 cents US in morning trading.

Mining and oil-and-gas extraction also increased in January.

The production of services advanced 0.4 per cent, led by wholesale trade.

Retail trade, the finance and insurance sector, transportation and the public sector also rose.

Meanwhile, the output of real estate agents and brokers, some tourism-related industries as well as agriculture and forestry retreated.

The volume of wholesaling activity increased 2.9 per cent with all wholesaling trade groups posting gains except apparel and alcohol and tobacco.

Value added in the retail trade sector rose 0.8 per cent in January.

Significant increases were registered in building and outdoor home supplies stores, home furnishings stores as well as food and beverage stores. Declines were recorded at new-and used-car dealers and at gasoline stations.

Porter added that early statistics for the month of February also look promising, with the gain of 60,000 full-time jobs, housing starts up six per cent and auto sales at their highest level in almost two years.

"Given today's results, and the fact that February is shaping up well, first-quarter GDP growth looks set to easily surpass our recently revised call of a gain of 4.7 per cent (let alone the Bank of Canada's latest estimate of 3.5 per cent), with growth on track for 5 1/2 per cent even if the next two months come in at just up 0.2 per cent."
 

Murky world of corruption in China

Published on Monday, March 29, 2010 at 9:01:00 AM EDT by CrossBorder Solutions Inc.

excerpted from todays BBC News, Beijing , by Michael Bristow

Huge amounts of money can be involved in shady business dealings
Bribery and other forms of corruption are problems often encountered by foreign businesses operating in China.

This can result in companies providing clients with expensive trips abroad, lavish meals and red envelopes stuffed with money.

But not all businesses get drawn into this murky world; some say they abide by the same high standards they observe elsewhere.

And one foreign business advisor said firms that supply good products and services will always do well - even if they refuse to be corrupt.

The use of bribery in the business world in China has come into sharp focus because of the trial involving four executives working for the Anglo-Australian mining firm Rio Tinto.

The four were sentenced in Shanghai to between seven and 14 years in prison for taking bribes and stealing commercial secrets.

But how much of a problem is bribery for foreign firms operating in China?

One British businessman, who did not want to be named, said it was a big problem, particularly in China's smaller cities.

He told the BBC of one occasion when he was trying to set up a joint venture company with a Chinese partner in Shandong province.

Often there is little understanding about China at headquarters and so regional managers hide things

Patrik Lockne
Negotiations had been going on for weeks, without any success, he said. Then, at one meeting, he was asked to step outside for a chat with an official.

"He said all the problems could be overcome - so I asked him how. He said it could be done if I gave him 1m yuan ($146,000: £98,000)," said the businessman.

Patrik Lockne, an advisor for a Swedish consultancy, said one common problem was a lack of communication between a firm's main office and its China branch.

Foreigners working in China are sometimes tempted to adopt local norms of behaviour in order to get work done, he said.

"Often there is little understanding about China at headquarters and so regional managers hide things," said Mr Lockne, who works for Springtime.

'Moving on'

Something like this appears to have happened at Rio Tinto.

The firm believed in its employees' innocence when they were first detained last July, saying the bribery accusations against them were "wholly without foundation".


Rio Tinto was quick to deny it had any knowledge of its employees' actions
At that time Rio Tinto said its workers had acted in accordance with the company's strict code of conduct.

But following the verdicts on Monday the firm said the four had been conducting their own illegal activities "outside our systems". It has now sacked them.

But not all foreign business people operating in China get tempted to do something unethical - and possibly illegal.

"I hear about it and I'm sure it happens, but I think it's the old way of doing business - times have moved on," said Rupert Utteridge, who runs the Australian telecom company Digital Techniques.

"We take people out for meals, but I would do that in Australia or Hong Kong," he added.

And, ultimately, building a successful business in China might simply be down to providing good products and services.

"There is corruption in China - of course there is," said Brian Outlaw, executive director of the China-Britain Business Council, which advises firms wanting to set up here.

"But companies can maintain their ethical codes. They can build in exactly the same way as anywhere else - and still be successful," he said.



 

WTO sees 9.5 per cent growth in merchandise trade

Published on Friday, March 26, 2010 at 10:14:00 AM EDT by CrossBorder Solutions Inc.

excerpted from today's online Canadian Business. Article by the Associated Press 

 GENEVA - The World Trade Organization said Friday that it expected 9.5 per cent growth in merchandise trade this year, in a strong recovery from the steepest commercial contraction since the Great Depression.

The rebound will be led by an 11 per cent growth in exports from developing countries such as China, India and Brazil, the WTO said. Exports from wealthy nations should rise 7.5 per cent.

World trade shrunk by 12 per cent in 2009, as the economic crisis destroyed consumer confidence, weakened demand, damaged credit lines for exporters and, in some instances, led to increased protectionism from governments.

The WTO said it was the "sharpest decline in more than 70 years."
 

Canadian firms ‘too U.S.-centric:'

Published on Thursday, March 25, 2010 at 11:56:00 AM EDT by CrossBorder Solutions Inc.

excerpted from today's Globe & Mail. Kevin Carmichael

A senior Indian economic minister says Canadian companies are too focused on the United States and as a result risk missing out on billions of dollars worth of investment opportunities in his country.

“I'm looking at Canada looking beyond NAFTA,” Kamal Nath, India's minister of road transport and highways, said in an interview Thursday.

“I don't think they have looked at India,” Mr. Nath said of Canadian companies. “They have heard about India, but they have not looked at India because they have been too U.S.-centric.”

The comments came in response to a question about why Mr. Nath, who is in the middle of three-day road show aimed at rounding up international investment, felt the need to solicit interest in an economy that is among the fastest growing in the world.

Mr. Nath's remarks reflect the widely held perception overseas that Canada's economy is an appendage of the United States, home of the world's largest economy to which Canadian businesses have easy access thanks to the North American Free Trade Agreement.



More Discussions in our Globe Investor forums
Are Canadian businesses hurting the economy?Started by: Claire Neary1 repliesLast post by Claire Neary
3/25/2010 10:24:44 AM

The comments also reinforce Bank of Canada Governor Mark Carney's controversial suggestion Wednesday that Canadian companies' aversion to risk is making the economy less competitive.

Speaking in Ottawa, Mr. Carney said businesses aren't taking advantage of tax cuts, low borrowing rates and stable inflation to invest. Invoking Aesop's fable of the ant and the grasshopper, the central bank chief also suggested that Canada's executives for too long have counted on the U.S., forgoing opportunities elsewhere.

“There could be tough times ahead,” Mr. Carney said. “Canadian grasshoppers, perhaps basking in the historically easy access to the U.S. market and the relative abundance of resource opportunities, could be in danger of wasting their days in the sun and finding themselves unprepared for the winter to come.”

If Mr. Carney's approach to stirring Canadian companies to seek out new markets is the stick, then Mr. Nath comes to Canada bearing carrots.

India's government believes the country needs investment in roads and other infrastructure of $75-billion over the next few years in order to maintain its objective of achieving economic growth of 8 per cent this year, 9 per cent in 2011 and 10 per cent in 2012.

The government can't afford that on its own. It is offering concessions, such as the opportunity to collect tolls on highways, to encourage private investment in infrastructure of $45-billion. Between 50 per cent and 60 per cent of that total will be offered to international companies, said Mr. Nath, who was in Toronto Wednesday and will visit Montreal on Friday.

Mr. Nath recounted a discussion he had with a Canadian consulting firm that has a presence in India. According to Mr. Nath, this firm, which he wouldn't name, is struggling to meet deadlines. Mr. Nath encouraged the firm to staff up. The company's response was that it already employed 1,100 people. Mr. Nath's response: expand to 2,000.

“Something we have is investment merit,” Mr. Nath said. But many Canadian companies he speaks with lack “the management structure to be able to tap it.”

 

Transition to HST - Updated Info sheet for ON , BC

Published on Tuesday, March 23, 2010 at 10:00:00 AM EDT by CrossBorder Solutions Inc.

The transition to the HST information sheet has been updated and can be found at: http://www.cra-arc.gc.ca/E/pub/gi/gi-070/README.html

 

Industrial Production: 2-Speed Recovery?

Published on Friday, March 19, 2010 at 9:17:00 AM EDT by CrossBorder Solutions Inc.

Commentary by Peter G. Hall - EDC

Recent data have many pundits hailing emerging markets as the world economy’s new growth engine. Industrial production statistics are a key part of that argument. Do they indeed suggest that there is a 2-speed recovery underway, and that emerging markets are leading the charge?
The recession was not kind to industrial production – defined as output of mining, manufacturing and utilities industries – in either industrialized or emerging markets. On average, the decline from peak to trough among G-7 nations was a whopping 23%. In the powerhouse BRIC-M emerging markets, the average decline was also severe, but at 17%, was much less so. There was a wide variety of experience in emerging markets. India was virtually unscathed, and Mexico held its decline to a better-than-average 11%. Brazil and Russia were just below average, while China was hardest-hit. The collapse of industrial production was more uniform in G-7 markets, excepting Japan’s 36% drop.

A quick perusal of the latest data shows that, while G-7 industrial production is growing again, levels of output are still about 16% below the pre-recession peak. In most cases, growth over the past six months has been tepid. Again, Japan is the notable exception, sporting an upswing almost as dramatic as its stunning freefall. However, production levels are still well below peak, and also below the G-7 average. By comparison, large emerging markets seem much better off. Post-collapse growth has been much stronger, enough to pull production back to the previous peak at the end of 2009. Russia, Brazil and Mexico are still well below peak, but the average was buoyed by India and China.

On the surface, emerging markets look impressive. But simple math paints a different picture. Prior to the recession, emerging market growth in industrial production was far quicker than in developed markets. Taking into account the relative magnitude of their declines, the mere return to average rates of growth – which has occurred in both zones – has naturally taken emerging markets back to peak more rapidly than their developed counterparts. The outcome is almost what one would expect.

A further look at the sources of growth is even more revealing. All markets are benefiting from public stimulus, but certain emerging markets – notably China – have particularly aggressive plans. In China’s case, fiscal measures amount to over 13% of GDP – more than three times the average OECD package. Add in monetary measures, and China’s stimulus grows to as much as 17% of GDP. As such, it is likely that a good deal of China’s production rebound is tied to public measures and less so to a standard revival of business activity, casting some doubt on the use of the word ‘recovery’.

If this is true, then in all likelihood, the true recovery is yet to come. Data suggest the same. A return to average growth, however notable, only maintains the gap between actual and potential production created by the collapse. Closing the gap suggests growth considerably greater than average – the type of growth that normally accompanies a recovery. As such, the future looks brighter for both developed and emerging markets, with opportunities in the latter continuing to outshine the rest.

The bottom line? Two-speed growth in industrial production is nothing new, just a reversion to the pre-recession average. Today’s growth is welcome, but data suggest better times still lie ahead. Emerging markets will top the growth charts, but they’ll need revived Western demand to do it.

 

Great Ideas: Adventures in Exporting

Published on Friday, March 19, 2010 at 9:16:00 AM EDT by CrossBorder Solutions Inc.

excerpted from Canadian Business Online, March 17, 2005

Selling your product in foreign markets is a terrific way to increase sales and diversify your customer base. But just like any aspect of your company, exporting brings with it potential problems, says Gerhard W. Kautz in Exporting from Canada. Learn about them now so you won't be surprised later.

Some of the most common issues that arise are:

Agent issues. Your foreign sales agent might pressure you to sign an agreement right away. This is a warning sign. A good agent will suggest that you not make a formal agreement until he or she tests the market with your product. Another agent problem is lack of activity on your behalf. But before you jump on an apparently inactive agent, make sure you have been giving him or her enough support, in the form of marketing materials and product knowledge.
Government corruption. This is common throughout the world; the usual form is bribery needed to speed up the issuance of permits. There are also many countries in which government officials may demand kickbacks for doing business with you. There's not much you can do about corruption, short of giving up the business in that market. Payoffs have been going on for centuries, and despite international efforts to stop corruption, they will probably continue.

Sucker bids. It's a dirty trick pulled on the novice exporter: a buyer wants to choose a supplier who has offered him personal benefits. But since he must prove that he considered several suppliers, he gets the proof he needs by asking several other firms (like yours) to bid on the project, even though he has no intention on doing business with them. You can thus end up spending a lot of effort and money for nothing. A good agent should be attuned to sucker bids and not get suckered himself.

Industrial espionage. It's real, and Canadian companies — especially those with a high-tech product — are being targeted. A typical approach is for a foreign competitor to buy your product and reverse engineer it. Unfortunately, you can't do much to stop this, except try to make your product as difficult as possible to reverse-engineer.

Customer issues. Common complaints are late shipments, incomplete delivery and problems with customs clearance. Your agent should deal with minor customer problems, at least initially. One of the more difficult challenges is overcoming any lack of understanding of a product due to language and education differences. Solving this problem can be an expensive and daunting task. An 800 number can help your North American customers, but for the rest of the world, you'll have to put a lot of faith in your agent

EU warns 5 nations on budgets

Published on Wednesday, March 17, 2010 at 9:30:00 AM EDT by CrossBorder Solutions Inc.

excerpted  from today's online Globe & Mail

The European Union on Wednesday warned Germany, France, Spain, Italy and the Netherlands that they are relying too much on a strong economic recovery to meet debt reduction targets.

European Commission reports say that the five largest nations that use the euro have “rather optimistic” growth forecasts in their programs to cut budget deficits to the EU limit of 3 per cent of gross domestic product.

It said budget figures could be worse than they expect if growth remains slow.

Germany's “budgetary strategy is not sufficient to bring the debt ratio back on a downward path,” the EU executive warned.

Berlin needs to reconcile possible tax cuts – promoted by Chancellor Angela Merkel's Free Democrat coalition partner – with the need to reduce budget spending, it said. It also warns that Berlin hasn't spelled out what cuts it would make after this year.

Europe's largest economy isn't facing rocketing debt and deficit levels but still needs to act because debt is mounting and the rising cost of pensions and social security could make it hard to fund public finances in the longer-term.

France's budget plans don't leave “any safety margin if economic developments turn out worse than projected” by the government's “markedly favourable” growth assumptions, the EU said.

It calls on France to specify spending cuts and show exactly how it will bring down its deficit and its debt – which will keep increasing until 2012 as France takes out a “grand loan” of €35-billion ($48-billion) to fund a stimulus program.

Spain may need to draft extra measures to reduce its huge deficit – estimated at 11.4 per cent this year – by 2013 because it may be too optimistic about growth after this year, the EU report said.

It also cautioned Madrid to make pension reforms to reduce spending. The Spanish government faced protests when it tried to do that by hiking the retirement age from 65 to 67.

The EU told Italy that its debt and deficit could be higher than targeted because the government's growth outlook is likewise too high, it hasn't described how it plans to make reductions and it could spend more than it assumes.

It also says Italy needs “a swift and durable recovery in productivity growth” to get the country's economy growing again. That implies developing more lucrative industries that could generate higher profits from exports.

The EU told the Dutch government to lay out more details on how it will reduce its deficit and debt by 2013.

 

Google and China go to War

Published on Tuesday, March 16, 2010 at 11:08:00 AM EDT by CrossBorder Solutions Inc.

excerpted from today's online Globe & Mail - article by Mark MacKinnon

The world’s most populous country and its best-known brand are in a new kind of war today, with the search engine formally opening hostilities after a series of incursions by the e-PLA.

Both sides have plenty to lose, with Google admitting it may have to withdraw from the potentially lucrative Chinese market – the world’s largest, with more than 300 million Internet users – and the Chinese government likely to lose international respectability over allegations that it participated in or tolerated the hacking of Gmail accounts belonging to Chinese human rights activists and others.

Another risk for the Communist Party is that it seems to be incurring the wrath of that same online community, which has already learned to live, grumpily, without sites such Facebook, Twitter and YouTube.

The Chinese Internet is abuzz today with news that Google will stop censoring searches on google.cn – and may soon withdraw from China completely; raising the possibility of a Chinese Internet that increasingly exists as a separate entity from the rest of the World Wide Web.

Here’s a quick sampling of some of what is being said (note: Baidu, which cooperates with Chinese government censors, is the most popular search engine in the country, with more than 60 per cent of the market):

“Alas, a huge country of 1.3 billion people and 9.6million square meters land can't accept a website, sad” – a netizen named “Han” from Beijing who posted at the news.qq.com site.

“I knew this day was coming. (With a slogan like) “Don’t be evil” Google, you can’t stay long here.” – “Liyuan” from Wuhan, also at news.qq.com

“How sad this news is indeed! A world with only Baidu’s rules is not what I want to see!” – “Tianlu” from Wuhu City at the same site

Tianlu’s post drew a reply from a netizen who gave their name as “Xiangmatou”: “This is what the people in power would like to see the most. It is easier and more convenient for them to rule people’s views and the direction control of information.”

Isn’t it a hype? China is such a big market. How come Google feel willingly to give up the big cake? But if it is true, it means a lost to us, because Google has more sources than Baidu. It’ll be a pity!

The discussion at the Chinese website of the Global Times newspaper was tamer, with some openly doubting whether Google would carry through on its threats:

“Isn’t it a hype? China is such a big market. How can Google be willing to give up such a big cake? But if it is true, it is a loss for us, because Google has more sources than Baidu. It’ll be a pity!” was one representative reader post.

(Interestingly, the state-run Xinhua news service took a similar line, suggesting that Google’s decision was not yet final and that the government was “seeking clarity” on the Internet giant’s intentions.

The U.S.-based China Digital Times, meanwhile, has been translating and compiling some of the reaction to the Google-China spat on Twitter (which can be accessed in China by those able to reach a Virtual Private Network. Some of the most interesting:

@hecaitou: After Google leaves China, the world’s top three websites on Alexa —Google, Facebook and Youtube are all blocked in China. This is not an issue of Google abandoning China, but one of China abandoning the world.

@mranti Withdrawal of Google means: 1 Scaling the wall is now an essential tool 2 Techies, you should immigrate

@lysosome On campus discussion forums Google tag has been removed

@Fenng Ten years online has turned me from an optimist into a pessimist

 

Canada Attends Intl Aviation Security Conference

Published on Monday, March 15, 2010 at 9:18:00 AM EDT by CrossBorder Solutions Inc.

Transport Canada news release Mar. 15, 2010 

The Honourable Rob Merrifield, Minister of State (Transport), met today with Canada’s international partners in the Asia Pacific Region to address the risks to civil aviation security and improve the effectiveness of security measures.

High-level officials from Australia, Cambodia, Canada, China, Hong Kong, India, Indonesia, Japan, Malaysia, Myanmar, Nepal, New Zealand, Pakistan, the Philippines, the Republic of Korea, Singapore, Thailand, the United States of America and Vietnam attended, as well as the Secretary General of the International Civil Aviation Organization (ICAO).

“Our government remains vigilant against the threat of terrorism and unwavering in its determination to keep Canadians and those who use our airways safe and secure,” said Minister Merrifield. “This can only be achieved through continued support for enhancements to global aviation security, international collaboration, information sharing, research and development.”

Civil aviation is an integral part of Canada’s economy. A large number of Canadian companies rely on aviation for the safe and secure trades with the rest of the world and approximately 50 million people travel by air in Canada each year. In light of terrorist incidents aimed at aviation, security threats pose a common risk to aviation activity for all international partners.

Key aspects of the discussions included:

broadening existing cooperation mechanisms among countries for early detection of security threats to passenger security and the industry’s well-being;
sharing best practices and information in areas such as screening and inspection techniques, chemical and weapon detection, airport security, screening and credentials of airport employees; and
using modern technologies to detect prohibited materials while respecting the privacy and civil liberties of individuals.
“All governments can learn from the failed terrorist attack of December 25, 2009,” added Minister Merrifield. “Our government announced in its recent budget significant investments to continue to maintain secure air travel.”

A joint declaration by ministers and high-level officials at the meeting can be found at www.tc.gc.ca/eng/mediaroom/backgrounders-5856.htm.

This is the second joint statement on aviation security signed between Canada and international partners. The first statement was issued between Canada and representatives from Western Hemisphere countries on February 17, 2010 and is available at www.tc.gc.ca/eng/mediaroom/backgrounders-5835.htm.

 

Canadian Ocean Exports Space Capacity

Published on Thursday, March 11, 2010 at 9:41:00 AM EST by CrossBorder Solutions Inc.

excerpted from today's Canadian Freight Forwarders Association enewsletter


In our Bulletin of February 24 we highlighted a report by American Shipper of US exporters facing major problems when looking for outbound space. Apparently the usual phenomena have reared their ugly heads in terms of deferred bookings, rolling of cargo and such like occurrences. Several CIFFA Members have since reported that for certain lane segments and carriers a similar situation exists in Canada. In an extreme case, one exporter had to wait for two months to have an export slot made available. Subsequently to our bulletins from February 24 and March 1, we have been receiving feedback from CIFFA Members that the situation is very similar in Canada at most ports and with most carriers. The lack of export capacity is in some instances causing foreign buyers to go elsewhere. Shippers are in a position to lose orders and the situation is becoming very serious for our economy.

Our Members share the following:

“Capacity shortages are certainly the case in Canada too. We had a situation recently where a customer’s container was sitting in Toronto for almost 4 weeks before getting shipped to Tanzania so obviously the shipper was furious.”

“Last week we contacted various lines seeking FCL rates from the Prairies to CY Bangkok - YML and COSCO both declined to quote stating they had no space on their vessels for at least a month and they didn’t even bother to ask when the goods might be ready! Which in fact was pertinent as this was for a major tender commencing in the summer, and thus the rates were required as part of the 'tender'.”

“It’s tough enough trying to move product from southern Saskatchewan, when over 50% of the lines use CN rail, and will not entertain containers ex Regina. Are Saskatchewan importers/exporters being treated fairly by our rail/ocean infrastructure - not without paying a premium in most instances? Not the first time, and sure will not be the last time the lines look at immediate status and not long term.”

“Things are worse on the export side for space. We have clients looking for 5 - 8 positions and only getting 1 or 2 on a sailing. Bookings are 3 to 4 weeks in advance. This is basically across the board with all carriers.”

“Depending on the carrier - for exports from Canada to Asia, we were advised that 1st space available for sailing in the 1st week of April and the equipment allocation is limited to no more than 3-5 containers per vessel. Vancouver to Far East Asia and Vancouver to India Subcontinent.”

In a recent letter to customers, Maersk Line CEO Eivind Kolding says shippers and ocean carriers alike are "experiencing an instant change in the market" which has led to volatility and made business-as-usual impossible. "We realize that this abrupt change in market conditions has not been managed well by us in all instances, causing undue problems, for which we apologize," he writes. "A particular challenge has been an extraordinary amount of overbooking’s on many of our sailings," he says, promising to find ways to alleviate the problems, which have caused "great inefficiencies for all of us." Kolding predicts the current market conditions will continue through the first quarter of 2010 and into the second quarter, as carriers are likely to be unwilling to "overcorrect" capacity adjustments.

How can a sophisticated and experienced trading country like Canada accept such an intolerable decline in service to export customers?


 

Selling Outside the U.S. Hobbled Market

Published on Wednesday, March 10, 2010 at 8:45:00 AM EST by CrossBorder Solutions Inc.

excerpted from today's Globe and Mail

The clamour of industry still rings in the air at the 300-year-old waterfront shipyard in Kingston, Ont.

The scream of grinders and the bark of mechanized saws competes with the hiss and crackle of welding torches as craftsmen inside two steel sheds work on gleaming aluminum utility and patrol vessels soon bound for the United States, Panama and Lebanon.

This is the home of 23-year-old MetalCraft Marine Inc., and business is booming. But the Kingston-based company's good fortune could have capsized if it hadn't made a dramatic shift in marketing strategy. In the summer of 2007, U.S. business journalists began reporting on the subprime mortgage crisis and a growing crisis in the financial sector. Bob Clark, MetalCraft’s contracts manager, set out to learn more about the potential trouble ahead. At the time, 95 per cent of the company’s revenue came from selling high-speed patrol and search-and-rescue craft to U.S. regional and federal governments: MetalCraft’s continued prosperity depended on a strong U.S. economy.

“When I found out what it was, I realized it could have a domino effect—a house of cards collapsing—and we immediately started looking for business outside the U.S.,” he says.

Within weeks, MetalCraft shifted much of its sales and marketing budget overseas. It began to focus on Asia, the Middle East, and Central and South America.

While Mr. Clark describes MetalCraft's move as a necessity, business strategy expert Douglas Reid says few Canadian companies “had the guts” to make the same decision when signs of a looming economic crisis first began to surface.

“It reflects exactly the kind of thinking that I would hope more businesses would do, which is foresight and a willingness to not go with the herd,” says Prof. Reid, a Queen's University business professor.

After years of steady but slow growth, revenue at the boat builder suddenly took off. By 2008, overseas business increased by 20 per cent. With boats ranging in price from $300,000 to $5-million, MetalCraft’s annual revenue is now about $10-million. Offshore orders represent 45 per cent of business while U.S. business accounts for just 55 per cent of sales. The company used to do business with the Canadian government but stopped because it has a procurement window of only a few months and it did not consistently order new boats every year, so the domestic market was too short and undependable.

Based on MetalCraft's 2010 order books, overall revenues will rise by 50 per cent over 2007 numbers, Mr. Clark says.

Many Canadian companies were hit hard by the collapse of U.S. financial markets as a result of being tightly bonded to the United States by 22 years of free trade, Prof. Reid says. Approximately 78 per cent of Canadian merchandise exports go south of the border, according to a February report by the Conference Board of Canada.

While there's no data representing the number of Canadian companies that have followed a similar strategy as that of MetalCraft, the Conference Board suggests Canadian companies have been trending away from the U.S. market since the middle of the decade.

Between 2004 and 2008, the share of Canada's merchandise trade going to the U.S. dropped from 85 per cent to 78 per cent, says the Conference Board report.

It suggests a number of factors are the cause: slower U.S. economic growth, the tech bust, the appreciation of the Canadian dollar, and the two bi-lateral free trade agreements running out of steam.

“Today it's not difficult to see why you should avoid the U.S. It's a difficult market to get sales, and the advantage of sharing a common language and business structure isn't going to make it simpler to pry money out of their pockets,” Prof. Reid says.

He expects momentum toward global diversification to grow among Canadian companies over the next few years as a result of a realization that Canadian business cannot continue to rely on the U.S. market. With U.S. state governments in financial trouble, the federal government in a massive deficit, tax increases imminent, and unemployment numbers at record levels, it's expected that U.S. firms will continue to face pressure to buy American.

Even when unemployment falls to more normal levels, there's no guarantee that sentiment will dissipate, Prof. Reid says. “You're going to see a lot of that until unemployment gets down to a couple million (people), but even then there's no guarantee that the buy-domestic sentiment will go away.”

Welder Len Bassette works on the $4.4 million (US) high speed fire boat that is currently being built for the Jacksonville, Florida fire department. MetalCraft Marine is located in Kingston, Ontario.

A degenerating U.S. market isn't the only reason Canadian companies are gravitating towards doing business globally. Canada's huge multicultural population means that this country has links to every other country on the planet, says Eric Gilboord, a Toronto expert in lead generation business development, which involves helping established companies generate growth opportunities.

“Due to immigration over the past decade, it's not so difficult for a quote-unquote Canadian company to go and do business in the country where they came from—it just makes perfect sense to go back to where you have connections,” Mr. Gilboord says.

While MetalCraft is still winning orders in the United States, attributable the to the sheer size of the market, Mr. Clark expects demand there will shrivel over 2011 and 2012 as federal and state governments work to get their budgets under control.

But thanks to its overseas diversification, staff numbers have swelled to 92 from the 45 employed at MetalCraft in 2007—the work force size had been static since 2004—and a new building has been purchased offsite to accommodate the increasing workload. More sales staff hiring is also planned.

“We're thinking of adding a second shift, which is unheard of in the business,” Mr. Clark says.
MetalCraft has earned a reputation for high quality boats and top technology at mid-range prices around the world, making its boats popular. It began by selling at low prices, but now has earned a reputation that allows it to sell at mid-range prices.

Mr. Clark says that in many ways drumming up business overseas for MetalCraft was easier than in the United States. The U.S. has its own domestic boat manufacturing network, so its procurement policies are not geared to make life easy for outside manufacturers. The opposite is generally the case in offshore countries and their rules tend to reflect more international standards.

The company received help from the Canadian government when it started marketing south of the border in 1994, but it no longer required assistance when it began to focus overseas.

 

Job Seekers Faced with Wary Employers

Published on Tuesday, March 9, 2010 at 10:38:00 AM EST by CrossBorder Solutions Inc.

The following is an excerpt from today's "globeandmail.com".

It's shaping up to be a jobless recovery, as Canada's public sector starts to reduce employment while companies remain hesitant to hire.

The economy may have revved back to life at the end of last year, but cautious employers are more likely to boost the hours of existing workers, or hire people on a temporary basis, before they take on new full-time staff.

In the meantime, belt-tightening in the public sector - the key source of job creation last year - is now triggering hiring freezes and layoffs. Treasury Board President Stockwell Day said yesterday he is eliminating 245 federal positions from government boards and agencies. B.C. said last week it plans to eliminate 3,500 full-time equivalent positions in the coming years. Cities such as Toronto are in a hiring freeze.

That suggests little job growth this year even if the economic recovery solidifies, economists said. It will take at least another year, and maybe two, to recover all of the 280,000 lost jobs in the recession, said Sébastien Lavoie, assistant chief economist at Laurentian Bank Securities.

"It looks like we'll have to wait until 2011 to see as many Canadians working as before the recession," he said, adding that he expects job creation of just 125,000 positions this year.

Indeed, three-quarters of businesses don't plan to change their head count in the coming months, Manpower Canada said in a survey to be released today showing the employment outlook actually deteriorated for the second quarter from the first. Seventeen per cent of employers plan to hire in the coming quarter, 6 per cent see layoffs and 75 per cent anticipate no change.

Hiring intentions in public administration have declined from both the previous quarter and last year, the Manpower survey shows.The results "reinforce the sense that this is a jobless recovery," said Byrne Luft, the firm's vice-president of marketing. "We're moving out of this quite slowly."

Employment tends to lag economic recoveries by six months, so he doesn't see much job growth until the third quarter of this year. His own staffing firm is seeing demand grow for temporary workers in areas such as information technology.

The cities with the country's brightest hiring outlook are Regina, Niagara Falls and Fredericton, N.B. The bleakest is in Red Deer, Alta., along with Northumberland county and Hamilton in Ontario.

With so much uncertainty about the sustainability of the recovery - given that governments will be withdrawing stimulus spending and shifting into deficit-cutting mode, interest rates will start to climb and global demand is still uneven "there's a lot to think about before you commit yourself to a new hire," said Benjamin Tal, senior economist at CIBC World Markets. "I really don't see a V-shaped recovery for the labour market."...

A quarterly small-business survey to be released today, meanwhile, shows 38 per cent of firms plan to hire in the next year - indicating 62 per cent don't expect to add to payrolls.

The small-business survey, by American Express, showed that, of those who do plan to add staff, about half are looking for full-time, permanent employees.

***

SHIFTING LANDSCAPE FOR LABOUR MARKET

In coming years, Canada's labour market will see one of the biggest shifts in its history as baby boomers retire and temporary work increases - both of which have ramifications for employees and employers alike.

"Very significant" challenges will need to be addressed if the country is to maintain its standard of living, Toronto-Dominion Bank economists Don Drummond and Francis Fong said in a paper published yesterday about Canada's changing workplace. They highlight five key issues:

More than a third of the work force plans to retire in the next two decades. That, coupled with low fertility rates, will cause the labour market to slow and may force employers to increase wages to attract workers.

Under-represented segments of the population, such as immigrants, aboriginals, women and older workers, must be utilized more efficiently. Better inclusion of each group poses its own set of challenges: Women still face a big gender wage gap; immigrants are at a higher risk of falling into low-income status; and only half of aboriginal people on reserves have a high-school diploma.

Higher education is becoming ever more important.

In the next five years, about two-thirds of new jobs will need postsecondary education. Yet only about half of Canadians have such education. Access will need to be improved, particularly among low-income students.

Well-paid, full-time jobs with good benefits and pensions have been replaced by temporary or contract jobs without benefits. As well, private employer-sponsored pensions are disappearing, suggesting more Canadians will have to finance their own retirements.

Literacy remains inadequate. Almost four in 10 young Canadians lack reading skills and more than two in 10 university grads don't have appropriate English or French literacy skills. The problem is particularly dire among new immigrants. "For the most part, the consequences of these trends are negative: slowing labour force and productivity growth pose significant downside risk to overall economic growth and the standards of living of Canadians," the report said. "Overcoming these challenges merits the immediate attention of employers as the solutions must come from a complete overhaul of how we consider the labour force."
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Myriad of customs issues facing Canadian importers

Published on Monday, March 8, 2010 at 12:45:00 PM EST by CrossBorder Solutions Inc.

A contribution by I.E.Canada

March 8, 2010

Canada is a trading nation and as a result Canadian businesses deal with complex trade regulations and rapidly changing processes on a daily basis. When asked what their most pressing concerns are, businesses surveyed by I.E.Canada – the Canadian Association of Importers and Exporters – consistently rank trade and customs issues among their top concerns.

This is not surprising when you consider that in addition to everyday business concerns, importers and exporters have the added burden of customs and security programs and the technological challenges that go along with them, as well as supply chain issues that can range from varying transportation infrastructure capabilities to international financing strategies.

Canada has put in place many programs that determine what and how businesses can import and export, with the aim of ensuring the security, health and safety of Canadians while facilitating legitimate trade. The Canada Border Services Agency (CBSA) administers most customs programs and ensures compliance to trade rules. CBSA is currently revamping and further developing many trade programs. While the aim is ultimately to expedite and improve trade processes, implementation growing pains are being felt by many businesses.

Trusted trader programs, such as Partners in Protection (PIP) in Canada and Customs-Trade Partnership Against Terrorism (C-TPAT) in the U.S., require significant investment on the part of businesses that undertake the certification process. Both programs are voluntary, but for those that choose to participate, there can be significant capital, human and financial resources involved to meet the minimum security requirements. It can prove to be prohibitive for small and medium-sized companies.

The aim of securing the trade chain is widely supported, and 75 per cent of the companies that recently completed an I.E.Canada survey and indicated they had undertaken the PIP certification process said that they would recommend it. Yet they do acknowledge that becoming PIP certified requires a tremendous investment. They would like to see shorter time frames for application processing and for site validations, steps that are a necessary part of becoming PIP certified. Companies feel that one of the main benefits of participating in the PIP program is the fact that PIP and C-TPAT have achieved mutual recognition, meaning that businesses that are PIP certified are also seen as meeting the U.S. C-TPAT requirements. They support PIP’s efforts to gain mutual recognition with programs in other countries. Another key benefit companies see from their participation in PIP is an improved relationship with CBSA, which results in fewer inspections.

Getting goods across borders requires the transmission of massive amounts of information, and processing this data along with a shipment is a challenge. CBSA has been working to expand its systems through the phased-in implementation of Advance Commercial Information (ACI), intended to enhance security while expediting trade processing at the border. ACI Phase I brought advance carrier and conveyance data to the marine mode, while Phase II applied to air shipments. Under the current phase (ACI Phase III, referred to as eManifest), ACI will be brought to the highway and rail modes. In addition, freight forwarders will be required to transmit secondary (house bill) data, and importers or their brokers will have to transmit advance trade data (ATD), formerly referred to as importer admissibility data, electronically in advance in all modes of transportation. This change will impact the business processes of carriers and importers and will require all parties in the supply chain to work together to ensure that the right information gets to the right place at the right time.

Currently, CBSA is undertaking the implementation of eManifest highway. The equivalent system in the U.S. is known as ACE eManifest, and is already in place for goods travelling by highway into the U.S. CBSA will be able to begin accepting carrier and conveyance data in the highway mode via electronic data interchange (EDI) in June. CBSA is also developing a web portal that is anticipated to be available by fall. One year following the availability of the web portal, eManifest highway will become mandatory, although there will be a six-month informed compliance period.

The biggest challenge for importers will come in 2012 when CBSA will begin implementation of ATD requirements for importers. ATD is similar to the importer security filing (the 10 data elements required from importers under ‘10 + 2’) in the United States. Under this initiative, importers are required to transmit eight data elements 24 hours prior to lading and an additional two data elements 24 hours prior to arrival. Unlike in the U.S., however, which has implemented this new importer security filing in the marine mode only, CBSA is planning to impose ATD on importers in all modes: marine, air, rail and highway. While there will be fewer data elements in the other modes, industry is concerned that implementation of ATD as planned will have a serious negative impact on the competitiveness of Canadian business by increasing the costs of brokerage, warehousing and services, and by causing delays in shipments and manufacturing production.

As an alternative to ACI, some importers are choosing the Customs Self Assessment (CSA) program, which is designed, among other things, to expedite the customs clearance of shipments for low-risk, pre-approved importers. Provided they use a pre-approved carrier and a registered driver, CSA importers benefit from an expedited clearance option, which allows them to supply just three data elements – the importer, the carrier and the driver – for CSA eligible goods.

Originally, the CSA program applied only to goods of U.S. origin and to automotive goods from Mexico. CBSA has recently expanded the program to include all goods from Mexico. The agency has also developed a working proposal for an offshore clearance option in consultation with importers through associations such as I.E.Canada. Under this proposal, the CSA importer would be required to provided enhanced Trade Chain Partner data for offshore shipments; the carrier will be required to provide full advance data (including information on crew, cargo and conveyance); and CSA importers will be obligated to confirm that the shipment is legitimate by providing information on a transactional basis, electronically and in advance in accordance with the ACI timeframes for importer admissibility data.

As CBSA moves forward with the ATD requirement, more companies will look to the CSA program. It provides a greater degree of certa­inty since fewer data requirements mean that the risk of error or omissions resulting in delays is reduced. Businesses are urging CBSA to continue the expansion of CSA in order to provide them with a viable alternative to ACI, but in order for this to happen, CBSA needs to offer CSA clearance in all transportation modes.

CBSA is not the only government agency or department that requires information and documentation relating to imports. In an effort to ease the burden on business, the government has undertaken the OGD Single Window Initiative that is intended to promote capture of the data required by other government departments and agencies through electronic means and to allow for a single point of contact with government through the CBSA. There are currently 10 other government departments (OGDs), in addition to the CBSA, participating in the OGD Single Window initiative, including the Canadian Food Inspection Agency, Health Canada and Environment Canada, representing over 40 programs. CBSA and the OGDs are looking at areas to improve service to the trade community, including, for example, a single authoritative source for regulatory information. But they’re not there yet; much consultation is still required with the business community on issues such as the specific data that will be required under the many OGD programs.

CBSA has also recognized that there is room to improve its approach to service. As part of the federal government’s commitment to reduce paperwork, CBSA established a Business Simplification Initiative in partnership with the trade community. As part of this initiative, CBSA has been taking steps to reduce the administrative burden its policies and programs impose on Canadian business and to institutionalize a culture of business simplification within the agency. CBSA has realized that there are areas for improvement in the delivery of its programs. Research has shown that customs administrations in countries such as Australia, New Zealand and the United States have established solid, service-oriented models. CBSA president Stephen Rigby has identified the creation of a service strategy as a priority with the aims being to strengthen the CBSA’s culture of service; reduce paperwork; simplify how business and travellers interact with the agency; reduce the cost of compliance; and increase accountability through the measurement of service standards.

While there are trade benefits for those shippers that are low risk – compliant importers and exporters, businesses that fail to comply with customs regulations face both shipment delays and administrative monetary penalties. Under the Administrative Monetary Penalty System (AMPS), CBSA assesses monetary penalties for non-compliance with customs requirements. After several years of consultations, CBSA is currently implementing changes to the AMPS regime. The objective is to simplify the AMPS regime by collapsing the current contraventions to 79 from 246 with a new penalty structure based on risk. In other words, penalty amounts will be higher where the contravention is considered to present a higher degree of risk. Under a revised AMPS implementation plan, as of April, the new penalty amounts will be in place for the existing AMPS contraventions; however, the new collapsed penalty structure, which will require significant systems, will not be implemented until fiscal year 2011-12.

While Canadian businesses import many products and services, they are also active in the export business and must meet export requirements imposed by Canadian authorities. Export controls serve an important and valuable end by ensuring that certain sensitive goods and technology do not fall into the hands of certain countries, especially those involved in weapons of mass destruction, terrorism or diversion to unacceptable uses. To meet these aims, most countries, including Canada, impose export controls on a wide range of goods and technologies destined to a wide range of countries and end uses.

Canada has maintained a system that requires individual permits for controlled goods with relatively few exceptions. This system is not always the most efficient; uncertainty or delays in getting the necessary permits has an adverse impact on Canadian business.

Most of Canada’s major trading partners, including the United States, appear to have adopted expedited licensing procedures for a broad range of goods to a broad range of allied and friendly countries, thus reducing the number of individual export permits/licences required. The result is a trade advantage to companies located in those countries and a trade disadvantage to Canadian companies.

A white paper, currently being drafted by I.E.Canada, compares specific aspects of Canada’s export control system with those of most of its major trading partners. Some of the issues that will be addressed include: the need to balance trade and security; the recent announcements in the United States of changes to U.S. export controls that will further widen the gap between Canadian and U.S. export control procedures; and the need for Canadian industry to be able to compete on a level playing field with its major trading partners. It will also include specific recommendations on how the Canadian government can improve the administration of the existing export controls regime.

Customs rules and regulations aside, Canadian industry is also faced with the increasingly urgent issue of an aging infrastructure. The current state and capacity of our roadways, rail systems and airports concerns most any business, but particularly those that rely on the transportation of parts and products as a key component of their business. A report recently released by the Institute for Research on Public Policy estimates that Canada requires a $200-billion investment in public infrastructure to remain competitive.

Yet even an obvious issue fails to have a simple solution. The Windsor-Detroit gateway is the busiest border crossing between Canada and the U.S., and plans for the construction of a new bridge, the Detroit River International Crossing (DRIC), appeared to be well underway. A new bridge would help ease congestion on the Ambassador Bridge, provide more direct highway access to the new bridge and serve as an alternate crossing in the case of an emergency, such as an accident or terrorist incident. In 2009, the Ontario government began construction on its part of the connecting highway link. However, political manoeuvring in the Michigan legislature is now putting the future of the long-awaited second bridge in the Windsor-Detroit area in doubt. The fate of the new bridge will be determined in June when the issue will come before Michigan legislators.

At the end of the day, the Canadian economy relies on our importers and exporters to remain competitive. The import content of Canadian exports continues to rise; recent reports from Export Development Canada (EDC) showed that, on average, import inputs into Canadian products runs on average 30 to 35 per cent. This means that our customs and trade processes need to be effective and efficient. Maintaining Canada’s position as a strong global economy must remain a priority for businesses, policy-makers, financial institutions, service providers and consumers. Applying the highest standards to our import and export processes, both in terms of regulatory and business practices, will put Canada in the lead as a trading nation and ultimately make us a globally competitive nation.

More information about the topics listed in this article and on the latest trade policies and programs, both at home and abroad, will be featured at I.E.Canada’s Emerging Issues in Customs and Trade Compliance conference in Toronto on April 19-21. Canadian Sailings is a media sponsor of the conference. For information, contact Fée Kiessling at fkiessling@iecanada.com. For more information about I.E.Canada, visit www.iecanada.com.





Recent Miscellaneous News


Myriad of customs issues facing Canadian importers and exporters

International Joint Commission names new Canadian chairman

U.S.-flag lakers begin year on strong note


 

Budget 2010: A second year of stimulus spending

Published on Friday, March 5, 2010 at 11:39:00 AM EST by CrossBorder Solutions Inc.

Excerpted from the National Post, Mar. 4, 2010

OTTAWA -- The Conservative government sketched out on Thursday its initial plans to return to budget balance, by targeting cuts in the public service, a freeze on foreign aid, limited growth in military spending and higher EI premiums.

The spending restraint, outlined in its 2010 budget, would net $17.6-billion in savings over five years and bring the deficit down from a high of $53.8-billion this fiscal year, ending March 31, to a low of $1.8-billion by 2015.

Before the cuts kick in, however, the Conservative government said it was committed to spend $19-billion as part of year two of the two-year $47-billion stimulus package aimed at resuscitating the economy after the global financial crisis.

The 451-page budget sets out how the Conservatives plan to meet all its goals -- of creating jobs and bolstering Canada's long-term competitiveness, while at the same time returning to surplus without tax increases, nor cuts to transfers to provinces and individuals. The government also said it would go through with cuts to corporate income taxes, from 19% to 15% by 2012, despite calls from opposition politicians to cancel them and use the money to help seniors and the poor.

"We are building Canada's reputation as an investment-friendly country," Finance Minister Jim Flaherty said in his budget speech. "A country committed to free and open trade, unburdened by massive debts and [the] higher taxes of our competitors."

All the opposition parties vowed to vote against the budget -- although Liberal Leader Michael Ignatieff said his party would not bring down the government and force an election by withholding the number of Liberal MPs who show up to vote.

Even though Canada's economy is recovering at a rather robust clip of late -- 5% growth was recorded in the final quarter of 2009 -- Mr. Flaherty said following through with more stimuli is the right thing to do as the global recovery is in its nascent stages.

Measures linked with the stimulus plan will expire as of March next year, and with it comes a plan to return to budget balance.

Overall, analysts said the budget struck a fair balance between adding momentum to the recovery from a deep recession, and preparing the economy for fiscal restraint.

"It is not a dramatic change of course, and in uncertain economic times you want a steady hand. And we are getting a steady hand," said Craig Wright, chief economist with Royal Bank of Canada.

For some, such as the NDP, there wasn't enough money to help the unemployed or the poor. Others said there wasn't enough on the spending-cut side.

"A plan to balance the budget should actually balance the budget and this doesn't do that," said Kevin Gaudet, federal director of the Canadian Taxpayers Federation. "Restraint delayed is restraint denied. Taxpayers have heard similar promises of restraint before. Canadians will believe it when they see it."

There were some new spending measures, although minor, such as extending a work-sharing program at a cost of over $100-million, and eliminating all tariffs on imported industrial inputs at cost of $1.2-billion over five years.

According to the government's plan, the $53.8-billion deficit will be cut in half in two years time, and by two-thirds in three years. Much of that will be due to allowing the stimulus plan, and its associated measures, expire in March 2011.

The government envisages robust growth in revenue, starting in the 2010-11 fiscal year, and will grow thereafter based on, among other things, four consecutive years of higher Employment Insurance premiums, which business leaders describe as a payroll tax.

Economists at Toronto-Dominion Bank have calculated that EI premiums will rise from the present $1.73 level to $2.33 by 2015, in an effort to return the EI account to balance. As a result, that will contribute nearly one quarter to the overall improvement to federal revenue over the next half decade, they said in a note.

On spending, the government will introduce legislation to freeze the salaries of all MPs and Senators for the next three fiscal years.

Also, Ottawa is eyeing $6.8-billion in savings through containing the operating costs of federal departments. Departments' operating budgets will be frozen in 2011 and 2012 at 2010 levels. Further, a 1.5% wage increase owed to unionized workers in 2010, at a cost of $300-million, has to be funded through cuts within departments.

The government also plans to cap growth in defence spending, which doubled to $20-billion in the previous decade. Restraint doesn't begin until 2012, and the efforts aim to achieve savings of $2.5-billion by 2015. Meanwhile, foreign aid will reach $5-billion this coming fiscal year, and increase no further, and be subject to review on a year-by-year basis.

Overall, after the stimulus package expires, program spending is set to increase at on an annual basis of between 1.5% and 2.5%. This could be quite the feat, as prior to the recession program spending grew at roughly 6% to 7% a year.

Douglas Porter, deputy chief economist at BMO Capital Markets, said the government's plan is banking on a well-entrenched U.S. and global economic recovery as of next year to smooth the way toward stimulus removal.

"The big question mark is whether the economy can withstand the abrupt removal of stimulus a year from now," he said. "To me, that's the real test."

The budget's underlying forecast envisages economic growth of 2.6% this year (below the Bank of Canada's forecast), 3.2% in 2011 and 3% in 2012.

At a media conference during a lockup for reporters, Mr. Flaherty said if the economic growth projections fell short, his government was prepared to "do more" in terms of spending restraint.

 

Throne Speech Warns of Spending Cuts

Published on Thursday, March 4, 2010 at 9:37:00 AM EST by CrossBorder Solutions Inc.

Throne speech warns of spending cuts

The following is excerpted from today's edition of "CBC News".

Freezing the salaries of federal politicians, restraining overall government spending and a possible change to the wording of the national anthem were among the initiatives unveiled in the Conservative government's speech from the throne on Wednesday....

The government said jobs and growth will remain the top priority as effects of the recession linger.

"This will require a return to fiscal balance, securing the strong budgetary position that distinguishes our country from so many others," Jean said.

The government said part of its plan to restore fiscal balance and tackle the $56-billion deficit is to restrain federal program spending overall, although pensions, education and health care would be exempt from cuts.

As well, stimulus spending and other measures under the Tories' economic stimulus plan will end by March 31, 2011.

The government said it will freeze the salaries of the prime minister, cabinet ministers, members of Parliament and senators to lead by example in its efforts to cut costs. The Tories also want to freeze the overall budget of ministers' offices and are urging all MPs and senators to do the same.

The Tories are also calling for a freeze in the total amount spent on salaries, administration and overhead in government departments.

The federal government is also looking to loosen foreign ownership restrictions on telecommunications companies, a move that would open Canada to service providers from other countries.

Focusing on crime, the government will also reintroduce, in its original form, the consumer safety bill and the anti-drug-crime legislation.

The government also plans to create legislation to increase penalties for sexual offences against children and strengthen the sex offender registry.

As well, new legislation would give families of murder victims access to special benefits under Employment Insurance. Employees of federally regulated industries would also have the right to unpaid leave if they or their family members are crime victims.

 

Economy hotter than estimated, Bank of Canada say

Published on Wednesday, March 3, 2010 at 11:10:00 AM EST by CrossBorder Solutions Inc.

Economy hotter than estimated, Bank of Canada says

The following is excerpted from the 2 March 2010 edition of "globeandmail.com".

The Bank of Canada kept its benchmark lending rate at a historic low of 0.25 per cent Tuesday, while hinting that policy makers are on closer watch for shifts in the inflation outlook that might force them to rethink their pledge to stay on hold through mid-year.

In the statement accompanying Tuesday's decision, Governor Mark Carney and his rate-setting panel acknowledged that growth and inflation have been hotter than policy makers estimated in their January forecast, saying the economy's 5-per-cent growth in the fourth quarter was “spurred by vigorous domestic spending and further recovery in exports.”

Also, in a nod to the fact that readings of core inflation, which exclude volatile items, came at the central bank's 2-per-cent target in January, sooner than policy makers had anticipated, they struck a somewhat more hawkish tone on price gains. The cental bank said the risks to their inflation outlook are now “roughly balanced” as opposed to language from previous statements that had said the risks were lower.
 

Shippers Dissatisfied with Rail Service

Published on Wednesday, March 3, 2010 at 11:05:00 AM EST by CrossBorder Solutions Inc.

The NRG Research Group of Winnipeg found a low level of satisfaction among 262 shippers it surveyed for the federal level of service review. Only 17 per cent of shippers said they were happy with the railways. In most satisfaction research, at least half of the customers would be in that category, NRG observed.

Meanwhile, one-third of respondents assigned low grades to their railway service and nearly half said their satisfaction level had deceased over the last three years. Almost two-thirds said they have “suffered a serious financial impact as a result of poor rail freight service.” About one-quarter of shippers with more than one rail connection option are very satisfied with the service they receive, while 14 per cent that have access to only one rail line are very satisfied.

NRG found most shipper dissatisfaction is linked to problems with:

• On-time delivery of cars at origin and destination;

• Timely pick-up of empty cars after unloading;

• Reliability of car supply, including timely release of cars into the system;

• Consistent transit times; and

• Responsiveness of railways to problems.

Survey respondents said that while CN is the more efficient railway, it needs “to focus more attention on its customers and their service needs.”

By a 2 to 1 score, shippers said they are more satisfied with CP’s service than CN’s. CN was credited with being better at tracking shipments, moving traffic quickly from origin to destination and achieving consistent transit times from origin to destination.

On the other hand, CP got the nod for professional and knowledgeable staff, responding when problems arise and offering frequent service. It was judged slightly better than CN at placing cars at origin on time.

Meanwhile, a report by the Quorum Group of Edmonton for the review panel outlined the challenges facing the two carriers in operating nearly 1,300 trains a day for hundreds of customers.

“To deliver effective rail transportation services to shippers, receivers, ports and terminals, every day they must plan, schedule and manage nearly 2,000 train crews, 3,000 locomotives and 200,000 rail cars,” the report said. “They must also co-ordinate the interchange of an estimated 10,000 rail cars per day with other railways, including some 49 short-line operators.”

 

Global trade wakes up as stimulus kicks in

Published on Friday, January 15, 2010 at 4:07:00 PM EST by CrossBorder Solutions

The following is excerpted from today's edition of the "globeandmail.com".

Global trade is on a slow but steady rebound as government stimulus programs spur demand and production in economies around the world.

The turnaround is somewhat uneven, and in some countries import growth is dramatically outpacing increases in exports, but gains in sales abroad are also expected to pick up as the worldwide recovery solidifies.

"Trade growth has come back substantially from where it was," said Steve Dunaway, adjunct senior fellow for international economics at the Council on Foreign Relations in Washington. "By the middle of last year, everyone was looking at declines in export growth. Export growth has a tendency to lag output growth, so it's not surprising that it's a little bit weaker than some of the indicators for output growth."

Canada tipped back into a trade deficit in November as the improving domestic economy caused imports to rise at more than three times the pace of exports, which are improving but still 19 per cent below year-earlier levels.

In the United States, the trade gap widened more than expected as imports outpaced exports because of higher oil prices and companies worked to replenish inventories. However, U.S. exports increased for the seventh successive month.

Exports grew faster than imports in Britain, one of the last big developed nations that hasn't yet seen a return to economic growth. In Japan, where imports were 18 per cent lower than a year earlier because demand remains static, the country had the smallest year-over-year export drop in 14 months on the strength of car sales elsewhere in Asia. And in China, exports jumped in December for the first time in 14 months.

With the exception of China, where not-yet-started infrastructure projects will mean the effects of government largesse are felt longer than in other nations, Mr. Dunaway said, many key economies are so dependent on stimulus spending that it's too soon to gauge the staying power of their recoveries.

For Canadian companies, there is reason for cautious optimism but trade is likely to remain choppy, said Peter Hall, chief economist of Export Development Canada.

"In the heaving seas between the end of recession and the beginning of a recovery, it's just a volatile zone," Mr. Hall said....

Even as a survey released yesterday indicates growing confidence among exporters, several hurdles remain, Mr. Hall said. It's unclear how economies will grow once government spending tapers off. Financial markets remain "fragile." Domestic demand in the U.S., Western Europe and Japan is still shaky. And the Canadian dollar remains strong.

Still, companies are adapting, he said, taking more steps to live with a high dollar, such as hedging - using a variety of strategies to reduce exposure to currency swings - re-jigging production lines and taking advantage of cheaper imports of equipment and machinery. The share of Canadian exporters that hedge to protect themselves from volatility in currency markets has risen to 19 per cent from 15 per cent in the spring, according to EDC's semi-annual trade confidence index....


***

Global snapshots

U.S.

Trade deficit, November: $36.4-billion (U.S.)

Exports: Up 0.9% from previous month to highest level in more than a year.

Imports: Up 2.6 per cent as oil prices jumped.

Trend: As demand from consumers and businesses recovers, imports will keep rising. The weaker U.S. dollar will help U.S. products overseas.

U.K.

Trade deficit, November: £6.8-billion ($11-billion U.S.).

Exports: Sales to China jumped 21 per cent from a year ago and sales to Hong Kong rose 15 per cent. Average export prices fell 0.4 per cent from earlier month.

Imports: Dropped even as average import prices were down 0.6-per cent from October.

Trend: Weaker pound may eventually boost British exports

further.

Canada

Trade deficit, November: $344-million (Canadian).

Exports: Up 1.1 per cent from month earlier.

Imports: Up 3.9 per cent from October..

Trend: While trade picture has improved in recent months, it's still off pre-recession levels, with exports down 19 per cent from November 2008.

China

Trade surplus, December: $18.4-billion (U.S.).

Exports: Up almost 18 per cent from year earlier, to $130.7-billion.

Imports: Soared 56 per cent to $112.3-billion.

Trend: Import gain provides more evidence that China is at risk of overheating. Export growth may increase calls for China to let its currency appreciate against the greenback.

Japan

Current account surplus, November: 1.1-trillion yen.

Exports: Down 7 per cent from a year earlier, amid stronger demand for cars spurred by exports to Asia. Imports: Down 18.2 per cent from a year earlier, reflecting sluggish domestic demand.

Trend: Export picture, though still down, is improving.