(Greg Robb – MarketWatch)
The Federal Reserve voted on Wednesday to end its bond-buying stimulus program commonly known as QE3 and sent several upbeat signals to markets that it was not worried about global weakness, low inflation or a wobble in financial markets.
In the statement, the Fed left unchanged its pledge that rates would remain near zero for a “considerable time.” But it qualified the statement, saying that if the economy improves faster than expected, than the first rate hike could come sooner than anticipated. Read more here.
(Richard Valdmanis – Reuters)
Canada has issued an emergency order to railways detailing how many handbrakes they must set on unattended trains to prevent deadly runaways, and will hire new staff to conduct an “audit blitz” of rail companies’ safety systems.
The changes are the latest in a slew of regulatory moves in North America since a train carrying crude oil crashed in Lac-Megantic, Quebec, last year, killing 47 people and highlighting the dangers from a surge in oil transport by rail. Read more here.
(Rainbow Nelson – The Loadstar)
The quantum leap in container vessel sizes over the last decade has left the logistics industry searching for answers about who really wins with the introduction of mega-vessels, mega-alliances and their much-lauded economies of scale.
As the supply chain is being re-shaped to accommodate 18,000teu vessels and the world’s largest shipping lines stretch, the paradigm of what is considered “normal” on every trade lane, port operators and shippers are set to feel the pressure and pick up the cheque for a new set of “disadvantages of scale” being faced throughout the supply chain, delegates heard at the recent TOC Americas conference in Cartagena.
Shippers, port operators and industry observers were perplexed by moves by the world’s largest shipping lines to pull up the drawbridge to new entrants to one of the world’s most confounding and consistently unprofitable industries. Read more here.
On Monday, the Securities and Exchange Commission (SEC) announced that Layne Christensen Co., a global water management, construction, and drilling company headquartered in Texas, has agreed to pay more than $5 million to settle charges of violating the Foreign Corrupt Practices Act (FCPA) by bribing government officials in Africa in exchange for favourable tax treatment, customs clearance and other improper benefits. Click here to read more.
(Ansuya Harjani – CNBC)
Exports are regarded as the bright spot in China’s slowing economy, but growing evidence suggests mainland firms are “over-invoicing” outbound shipments, inflating the trade data, say economists.
“When China’s external trade data for September came out two weeks ago, we were surprised by the apparent strength of exports. The Hong Kong trade data released [on Monday] suggests that renewed over-invoicing may be part of the reason for China’s strong September export data,” said Louis Kuijs, chief China economist at RBS.
China’s exports rose 15.3 percent on year in September, beating a median forecast in a Reuters poll for a rise of 11.8 percent, following a 9.4 percent rise in August. Read more here.
Canadian Prime Minister Stephen Harper canceled attending the upcoming Asia-Pacific Economic Co-operation Summit (APEC) in Beijing to remain in Ottawa for a national holiday that commemorates soldiers killed in the line of duty.
The annual Remembrance Day ceremony in Ottawa on Nov 11 coincides with the APEC summit in China on Nov 10-11. Read more here.
Related: Harper to Visit China Before APEC Summit (Globe & Mail)
(Jamie Sturgeon – Global News)
Falling oil prices coupled with headlines warning of impending doom for everything from stocks to home pricesare rattling consumer confidence.
A national index of sentiment among households released Tuesday said the mood among Canadians is down for the second month in a row – and fifth time in six months – “driven by a slew of disappointing economic data.”
The Conference Board of Canada’s Index of Consumer Confidence fell by 3.9 points to a reading of 84, as opinions about the current and future state of Canadians’ personal finances turned more negative, while intentions on future purchasing decisions also tumbled. Read more here.
This memorandum contains the remission orders that implement the Tariff Preference Level (TPL) mechanisms of the North American Free Trade Agreement (NAFTA), the Canada-Chile Free Trade Agreement (CCFTA) and the Canada-Costa Rica Free Trade Agreement (CCRFTA). It also contains administrative guidelines and other general information concerning the orders.
Under the terms of NAFTA, the Parties to the Agreement have agreed to grant preferential tariff treatment to specified quantities of certain yarns, fabrics, apparel, and textile articles, traded among the Parties that do not meet the rules of origin of the Agreement. These provisions of NAFTA constitute a trade mechanism known as a “Tariff Preference Level.” Similar provisions in CCFTA and CCRFTA apply to trade between Canada and Chile, and Canada and Costa Rica respectively. The preferential rate of duty under NAFTA, CCFTA and CCRFTA TPL mechanisms is the rate that would apply to the goods if they were originating goods under the applicable agreement.
Complete details are available here.
(Jonathan Stearns – Bloomberg)
Europe’s outgoing trade chief said the U.S. may break off talks on a commercial accord in early 2015 unless Europeans show a firmer willingness to include investment-protection provisions in any deal.
European Union Trade Commissioner Karel De Gucht said the EU would weaken U.S. interest in achieving the planned Trans-Atlantic Trade and Investment Partnership by carving out the investment-protection clause. He warned the EU against making the Americans feel as if they must “give in” on the matter. Read more here.
(Steve Goldstein – MarketWatch)
The market’s attention to the European Central Bank’s stress test has naturally focused on the health of banks on the Continent.
But the central bank also laid out a grim scenario for world trade in the publication released Sunday.
The ECB said it paid “particular attention” to shipping exposure, and marked up provisions to 7.3 billion euros from 5.9 billion euros. Read more here.
(Mike Wackett – The Loadstar)
With just two months before new sulphur content maritime emission regulations come into force in parts of Europe and the US, just a handful of deepsea ocean carriers have so far announced details of surcharges.
According to analyst Alphaliner, only Maersk Line, MSC and CMA CGM have announced low-sulphur surcharge tariffs covering services entering both the new emission control areas (ECAs), while OOCL has advised details of surcharges for the transatlantic only.
Global Shippers’ Forum secretary general Chris Welsh said shippers were worried that time is running out to include low-sulphur surcharge costs in their 2015 budgets. Read more here.
(Janet Porter – Lloyd’s Loading List)
Ocean Three, the newest alliance of container lines to take shape, will have an estimated market share of the Asia-North American trades of just under 13%.
In a detailed breakdown of the services that CMA CGM, China Shipping and United Arab Shipping Co will offer under their Ocean Three partnership, the trio’s calculation of its trade share explains why they have filed with the Federal Maritime Commission under the low market share provision that permits smaller alliances to escape an in depth review.
Ocean Three will have a larger share of the Asia-Europe trades, with its slice put at 20%. That is still well within the European Commission’s threshold for a consortium’s block exemption from competition rules. Read more here.
(Teddy Ng – SCMP)
Negotiations on a range of regional pacts will frustrate Beijing summit plan, says Apec official
China is seeking to leverage its status as host of the Apec summit to advance talks on an Asia-Pacific free-trade deal and a joint push against corruption, but work on other agreements is standing in the way.
China is pushing for a Pacific Rim free-trade zone, known as the Free Trade Area of the Asia-Pacific (FTAAP), to be in place by 2025. But discussion on the FTAAP was being distracted because negotiations on other massive trade deals were under way, and the 21 Apec economies were still working out if they would overlap, Asia-Pacific Economic Cooperation secretariat executive director Alan Bollard said. Read more here.
(Andy Pasztor – WSJ)
Current passenger security procedures are “not sustainable for the long term” because rapid global air-traffic growth threatens to overwhelm the capacity of screening checkpoints, according to the chief executive of the airline industry’s leading international trade group.
Tony Tyler, chief executive of the International Air Transport Association, told a security conference here that passenger and cargo security must be revised and updated to cope with changing threats. Read more here.
(Blue & Green Tomorrow)
The global trade in agricultural and timber products is pushing the planet’s forests to the brink, having been responsible for more than a third of recent deforestation, a new study has warned.
The report, commissioned by the Center for Global Development think-tank, noted that deforestation has historically been driven by smallholder farmers and local demand for goods.
But analysing deforestation in seven countries, including Argentina, Brazil and Indonesia, the study concluded that international consumption is increasingly to blame. More than a third of global deforestation is caused by the production of beef, soy, palm oil and wood products. Read more here.
(IndustryWeek – AFP)
More than one in three Africans have entered the middle class in the past decade, and their numbers are set to increase thanks to rapid economic growth, a study showed Monday.
At least 370 million Africans, or 34% of the continent’s 1.1 billion people, are described as members of the middle class, according to a survey by the African Development Bank. In turn, the bulging middle class will help drive further economic growth and development, the Tunis-based AfDB said.
By 2060 the group should represent 42% of the population, according to the study launched in Johannesburg nearly 20 years ago. Read more here.
Mexican factory exports slipped in September while consumer imports plunged in a sign that a recovery in Latin America’s No. 2 economy may be losing steam.
Factory exports fell 0.63% in September from August in seasonally adjusted terms, the national statistics agency said on Monday, dragged down by a 5.97% plunge in auto exports, its biggest contraction since August 2012. Read more here.
(Barrie McKenna – Globe & Mail)
To many experts, uneven growth spells trouble for Canada.
Not Peter Hall, chief economist at Export Development Canada. He said the suddenly surging U.S. economy has more than enough momentum to lift Canada and much of the rest of the world out of its funk.
“It goes against the grain,” Mr. Hall acknowledged in an interview Monday. “We’ve been conditioned to look for the weakness. But the U.S. is looking pretty strong to me.”
EDC is releasing a new forecast Tuesday for the Canadian and global economy – projections that are significantly more optimistic than the Bank of Canada and many private sector economists. Read more here.