Ministers have agreed to be flexible on trade regulations for developing countries, European Union Commissioner for Trade Karel De Gucht said here Wednesday.
“We have reached agreement on the flexibilities available to developing countries,” De Gucht said when delivering a speech at the plenary session of the Ninth World Trade Organization Ministerial Conference.
Regarding trade facilitation which is one of the three main topics of WTO negotiations, he said the ministers “have a recipe for success” when combining the trade facilitation package with the support pillars. Read more here.
(STR Trade Report)
The Federal Maritime Commission has announced that it will host a global regulatory summit Dec. 17 to discuss carrier alliances, vessel sharing agreements and the impact of operational agreements on international trade. Regulators from China and the European Union will attend the summit, which the FMC requested earlier this fall primarily to discuss the proposed P3 Global Alliance between the world’s largest container carriers, Maersk Line, CMA-CGM and Mediterranean Shipping. These carriers plan to begin cooperating in 2014 on routes between Asia and Europe, Asia and the U.S., and Europe and the U.S., and early estimates put the market control of such an alliance at about 42%, 24% and 40-42%, respectively.
(Peter Leach – Journal of Commerce)
One of the major headaches U.S. ports encounter in managing container trade flows is the imbalance in demand for loaded imports and exports. Ports handling more loaded imports than exports wind up with a lot of empties sitting around, taking up precious container yard space. Ports that focus on exports may have to scramble to find enough empties to load.
The gap between imports and exports at U.S. ports is a barometer of trends in the global container trade. When the world economy is booming, U.S. exports are up and the imbalances at import-oriented ports in Southern California, the Northeast and mid-Atlantic go down. If the world economy slows, as it did last year, U.S. exports slow and the imbalances at export-oriented ports, like Oakland or those in the Southeast, go up. Read more here.
U.S. Vice President Joe Biden suggested Tuesday the countries involved in the Trans-Pacific Partnership free trade talks must seek a “comprehensive” accord that overcomes their differences and Japan needs to compromise on sensitive subjects such as auto and agriculture.
“We need a comprehensive agreement that involves longstanding differences between the U.S. and Japan, including issues like agriculture and automobiles,” Biden told a joint press conference after meeting with Prime Minister Shinzo Abe in Tokyo.
The 12 TPP countries have been negotiating for a free trade area covering around 40 percent of global economic output. They aim to achieve a broad agreement during a ministerial meeting in Singapore starting Saturday. Read more here.
(David Cay Johnston — AJAM)
New trade deals favor multinational corporations, not ordinary Americans
The United States needs 9 million to 11 million more jobs to make up for ground lost in the Great Recession and population growth, but Washington is quietly working on two new trade pacts, negotiated in secrecy, that would destroy more jobs at home and enhance the power of multinational corporations.
The terms of such trade agreements are crucial because there is no such thing as free trade. All trade is governed by complex and detailed rules. For instance, the intellectual-property chapter in the proposed Trans-Pacific Partnership (TPP) is labeled Article QQ. That one chapter runs 30,000 words.
We know the terms of that chapter only because WikiLeaks posted the August version. The rest of the TPP, as well as the proposed Trans-Atlantic Free Trade Area, encompassing the United States and the European Union, remains secret. Read more here.
(Alex Carrick – Daily Commercial News)
In September, the month-to-month pace of goods exports from Canada at +1.8% was faster than good imports, +0.2%, according to Statistics Canada. The net effect was to reduce the nation’s trade deficit with the world to $5.2 billion from $13.0 billion in August (both figures annualized).
The most recent recession brought about a dramatic change in Canada’s merchandise trade position. Prior to December 2008, the country recorded nothing but positive balances going way back.
In the 58 months since then, there have been 13 months with a surplus and 45 with a deficit. The most serious shortfall occurred in July 2012 at -$34.8 billion. Read more here.
(Mike Wackett – The Loadstar)
The members of the G6– a merger of the New World and Grand Alliances – have announced plans to go head-to-head with the P3 network by expanding their operation to service all the east-west container tradelanes. .
Subject to regulatory approval, the new G6 operation will deploy around 76 ships across 12 services and connect 27 Asian ports to US west coast ports. It will operate a further 42 ships across five transatlantic loops servicing the US east coast and west coasts, Canada, Panama, Mexico and north Europe, which will include two pendulum services.
The move by G6 members Hapag-Lloyd, OOCL, NYK, APL, Hyundai Merchant Marine and MOL will be seen in the industry as a reaction and challenge to the P3 network of Maersk Line, MSC and CMA CGM, which is just beginning the process of gaining regulatory approval. Read more here.
(Gwynn Guilford – Quartz)
Though China trades more goods than any other nation, the yuan’s global presence is tiny. That’s changing, though. In October, the yuan accounted for 8.7% of global trade finance, surpassing the euro (6.6%) to become the world’s second-most-used trading currency behind the dollar, according to the Society for Worldwide Interbank Financial Telecommunication (SWIFT).
It was a quick role reversal: In January 2012, the euro claimed 7.9% of global trade, compared with the yuan’s 1.9%.
The trend is important because the yuan’s rise reflects the world’s confidence in China’s financial system, economy, and government. Many see this prospect as a threat to dollar (and, to some extent, euro) supremacy, which helps those countries to borrow cheaply. But while it’s certainly true that global businesses are increasingly willing to accept yuan, this particular milestone doesn’t really tell us much about those prospects. Read more here.
The International Air Transport Association (IATA) released figures showing a small improvement in air freight growth in October. Compared to October 2012, global freight tonne kilometers (FTK) grew 4.0%, with growth in all regions except Africa.
The gradual expansion continues a trend that began in the third quarter as air freight markets have responded to better economic confidence and improved consumer demand. Performance varies significantly by region, however.
Middle East carriers reported the most impressive growth at 12.3%. European and North American airlines reported growth of 4.4% and 3.7% respectively which is below the long-term cargo growth trend of 5%-6%. Asia-Pacific carriers grew by a marginal but significant 2.0%, finally countering the decline over most of 2013. The pick-up in Chinese growth and trade volumes across the region indicates that Asia-Pacific, which is comfortably the largest air freight region by market share, is potentially poised for continued expansion. Read more here.
Transparency International, a non-governmental organization that serves as a watchdog for corporate and political corruption, yesterday released its Corruption Perceptions Index for 2013. The index ranks countries around the world by perceived level of government corruption, with a score of 100 signaling an absence of official corruption and a score of 0 indicating a country that is utterly corrupt. Read more here.
China wants negotiations with the United States under the World Trade Organization (WTO) dispute-settlement mechanism over anti-dumping measures by the U.S. against Chinese products, the Ministry of Commerce (MOC) said Tuesday.
“In its anti-dumping investigations and reviews, the U.S. has inappropriately applied targeted-dumping methodology, denied companies separate tax rates, and used unfavorable facts,” the ministry’s spokesman Shen Danyang said in a statement.
“These practices not complying with WTO rules have resulted in the mistaken confirmation that Chinese products are dumped, and severely magnified the dumping margins,” Shen said. Read more here.
(Journal of Commerce)
Container lines currently use a variety of methods to announce general rate increases to the market, but those tactics could become more regulated in the future following the launch of the European Union’s antitrust investigation into container lines operating in the Asia-Europe trade.
Last week, the European Commission, the EU’s executive arm, launched an investigation into several container lines serving the Asia-Europe trade focused on alleged coordination of freight rate increases. The EC said carriers’ methods of announcing increases, including press releases, may be a way of signaling their intentions to each other, thereby reducing competition and harming customers. Read more here.
A state-of-the-art risk assessment tool gives the U.S. Consumer Product Safety Commission (CPSC) an edge in its mission to protect American consumers from products that violate U.S. safety rules or that are found to be defective.
The risk assessment methodology (RAM) pilot targeting system allows CPSC investigators to analyze data provided by the U.S. Customs and Border Protection (CBP) and identify high-risk shipments of consumer products arriving at U.S. ports of entry, and then make calculated and effective decisions about which shipments to inspect.
The RAM helped CPSC investigators and their CBP counterparts to screen more than 12,400 different imported consumer product shipments from the start of the 2013 fiscal year (FY) in October 2012 to the end of the second quarter in March 2013. The screenings led to the identification of about 680 shipments containing violative or defective products, totaling about 6.1 million units — all of which CPSC and CBP prevented from moving into the U.S. stream of commerce and into the hands of consumers. Read more here.
The Canadian dollar lost more ground on Monday, falling to its lowest intraday level in more than two years.
In the afternoon, the loonie was changing hands down 0.18 of a cent at 93.98 cents US, just shy of its close of 93.93 cents US on June 30, 2010. Earlier in the day, it traded as low as 93.86 before recovering some ground.
That’s the lowest the loonie has traded since October 2011. It is the first time the loonie has closed below 94 cents in more than three years. Read more here.
The European Union will on Friday begin imposing anti-dumping measures on some Chinese solar panels whose manufacturers rejected an amicable settlement.
The two-year measures will enter into force Friday Dec. 6, said the EU Commission, and will apply to those panels produced by Chinese manufacturers who rejected a deal to diffuse a brewing trade war. Read more here.
(Andrea Shalal-Esa – Reuters)
Mandatory U.S. budget cuts known as sequestration are resulting in job losses across the country and threaten to undermine U.S. competitiveness in the global economy, industry executives and academics said on Monday, urging Congress to reverse the cuts.
Wes Bush, chief executive of Northrop Grumman Corp, one of the biggest U.S. weapons makers, said his company had already reduced its workforce by 19% in recent years, and more cuts were likely unless U.S. lawmakers ended the across-the-board cuts required under sequestration. Bush, who is also the chairman of the Aerospace Industries Association, said arms makers realized that the end of the wars in Iraq and Afghanistan meant U.S. military spending would decline and that weapons needed to become more affordable.
But he said the additional cuts now facing the Pentagon and other government agencies were reducing funding for critical research and development programs, which could hurt the U.S. economy and threaten national security in years to come. Read more here.
On December 2, 2013, the Canada Border Services Agency (CBSA) has initiated a re-investigation pursuant to the Special Import Measures Act (SIMA) to update the normal values, export prices and the amounts of subsidy of certain stainless steel sinks originating in or exported from the People’s Republic of China (China).
The re-investigation is part of the ongoing enforcement of the Canadian International Trade Tribunal’s findings of material injury made on May 24, 2012 in Inquiry No. NQ-2011-02.
The subject goods are described in Appendix 1 and are normally classified under the listed ten-digit Harmonized System classification numbers. Additional product information explaining which products are subject to duties and which products are not subject to duties is also provided in the appendix.
It is anticipated that this re-investigation will be concluded on or before April 1, 2014. A re-investigation schedule is available here. Complete details about the re-investigation can be found here.
(Bien Perez – SCMP)
Major European trade associations have written to Vice-Premier Ma Kai calling on China to restart talks on expanding the scope of a global pact to remove tariffs on a range of information and communications technology products.
Negotiations were suspended on November 21 after China declined to make further concessions on the number of products it wanted excluded from an expanded Information Technology Agreement (ITA), a tariff-cutting scheme established in 1996 under the World Trade Organization (WTO).
However, Hosuk Lee-Makiyama, director of the European Centre for International Political Economy, a Brussels-based think tank, said any last-ditch effort to revive ITA talks this month is not realistic. “The negotiations are now effectively over, as China has made its choice,” he told the South China Morning Post. Read more here.
Extension of Investigation of Certain Hot-rolled Carbon Steel Plate and High-strength Low-alloy Steel Plate
The Canada Border Services Agency (CBSA) has, today, extended the investigation with respect to the alleged injurious dumping of certain hot-rolled carbon steel plate and high-strength low-alloy steel plate originating in or exported from Brazil, Chinese Taipei, Denmark, Indonesia, Italy, Japan and the Republic of Korea.
Pursuant to paragraph 39(1)(a) of the Special Import Measures Act, the President of the CBSA extended the 90-day period for making preliminary decision, pertaining to all or part of the investigation, to 135 days, due to the complexity and novelty of the issues presented by the investigation.
Consequently, the decision to issue the preliminary determination or to terminate all or part of the investigation will be made on or before January 17, 2014.
Complete details available here.
Chinese regulators published new details on planned reforms for a free trade zone launched in Shanghai earlier this year, as Beijing moves to sustain enthusiasm in the face of resurgent investor scepticism.
The list of reforms published by the People’s Bank of China (PBOC) on Monday was more detailed than previous lists but did not increase the proposed net scope of reforms in the zone, which already includes deep changes to the country’s exchange rate regime, cross-border investment flows and interest rates, alongside wide-ranging reforms to trade in goods and services.
The document said upcoming policy initiatives will include regulations allowing foreign companies with subsidiaries in the zone to issue yuan-denominated bonds; to allow foreigners to buy and sell Chinese equities and bonds directly without going through current pilot programmes and to similarly enable Chinese individuals in the zone to buy overseas financial products without going through the current Qualified Domestic Institutional Investor (QDII) programme. Read more here (subscription required).