Monday, February 7, 2011

Trade Deficit in U.S. Probably Widened as Imports Increased to Meet Demand


(Bloomberg – Bob Willis)
The U.S. trade deficit probably widened in December for the first time in four months as the cost of imported oil climbed, economists said before a report this week.

The gap grew to $40.2 billion from the $38.3 billion shortfall in November, according to the median of 58 estimates in a Bloomberg News survey ahead of the Commerce Department’s Feb. 11 report. Other figures may show consumer confidence climbed this month and claims for jobless benefits fell.

In addition to oil, imports may have also been boosted by the need to rebuild inventories at the end of the year after American consumers spent at a faster clip in the fourth quarter. At the same time, manufacturers like Caterpillar Inc. are enjoying sales gains overseas as demand picks up from customers in emerging economies, including
China and Brazil.

“In order to rebuild inventories of consumer goods, you would expect to see stronger import growth,” said Jay Bryson, a global economist at Wells Fargo Securities Inc. in
Charlotte, North Carolina. “Export growth remains pretty strong as most trading partners are experiencing solid rates of growth.” Read more here.

U.S. Ambassador David Jacobson Explains the Border Deal

(Macleans.ca – Luiza Ch. Savage)

At a meeting [Friday] in Washington, President Barack Obama and Prime Minister Stephen Harper launched a “Shared vision for perimeter security and economic competitiveness”. They announced that a group of senior government officials from both countries would form a “Beyond the Border Working Group.” The group will look for ways to streamline border security while creating a shared “perimeter security” around both countries. In addition, a Regulatory Cooperation Council will look for ways to coordinate and harmonize regulations in order to ease red tape for companies that do business in both countries.

After the leaders’ meeting, I spoke with
U.S. ambassador to Canada, David Jacobson, about what this all means. Read more here.

[Ed. Note: There is nothing of any meaningful substance whatsoever in the ambassador’s responses.]

President Obama and Prime Minister Harper Press Conference

(Whitehouse.gov)




President Obama and Canadian Prime Minister Stephen Harper hold a joint press conference and take questions from the media on various subjects, including trade and the current situation on Egypt. February 4, 2011.

Related: Breaking Down Borders: Canada-U.S. Trade and Security (Globe & Mail)

Harper, Obama Agree to Integrate Border, Creating Security and Trade Perimeter

(Sheldon Alberts — Montreal Gazette/Postmedia News) 

Prime Minister Stephen Harper and U.S. President Barack Obama are seeking a sweeping deal to establish a North American security and trade perimeter, opening talks Friday that could lead to jointly operated Canada-U.S. border facilities, an integrated entry-exit system to track travellers and the deployment of “cross-designated” law enforcement officers to intercept terrorists and criminals.
Harper touted the plan as vital to both the safety and prosperity of Canadians, even as critics expressed concerns a future agreement with the U.S. could compromise the nation’s sovereignty.

“This declaration is not about sovereignty. We are sovereign countries who have the capacity to act as we choose to act,” Harper told reporters following an hour-long White House meeting with Obama.
“It is in Canada’s interests to work with our partners in the United States to ensure that our borders are secure and ensure that we can trade and travel across them as safely and as openly as possible, within the context of our different laws. And that is what we’re trying to achieve...” Read more here.

Obama Revives Hopes for Border Plan

(Jerry ZremskiBuffalo News)

President Obama and Canadian Prime Minister Stephen Harper announced a “shared vision” Friday on border security and customs processing that some interpret as reopening the possibility of moving U.S. customs facilities from the Buffalo side of the Peace Bridge to Fort Erie, Ont.

Nearly 18 months after Homeland Security Secretary Janet Napolitano declared the “shared border management” concept dead, Obama and Harper, meeting at the White House, released a joint declaration promising further cooperation at border crossings.


“To enhance our risk management practices, we intend to continue planning together, organizing binational port-of-entry committees to coordinate planning and funding, building, expanding or modernizing shared border management facilities and border infrastructure where appropriate, and using information technology solutions,” the statement said. Read more here.


Related:
Chances Are Slim of Moving U. S. Plaza to Canada (Buffalo News)

Friday, February 4, 2011

Tapping Technology to Protect the Supply Chain

(Industry Week – Peter Alpern)

A recent study signals that cargo theft remains an ever-growing issue in the U.S., affecting a wide range of goods within the supply chain, but that RFID technology might be a strong solution.

According to FreightWatch’s 2010 Annual Cargo Theft Report, industry-wide cargo theft rose by 4.1% in 2010 and averaged 75 cargo theft incidents per month, a new record high.

The food and beverage industry was the hardest hit, accounting for nearly 21% of the total theft activity, with an average loss value of $125,000 per incident. Electronics accounted for 19% of all cargo theft with an average loss per incident of $512,000. Read more here.


The FreightWatch report can be downloaded from our website here.

Canadian Firms Lobby for Streamlined Border

(CTV News)

Businesses are clamouring for harmonized rules to fix the congested Canada-U.S. border, saying trade is suffering as layers of security checks and paperwork crimp economic growth.

As Prime Minister Stephen Harper and U.S. President Barack Obama prepare to meet Friday to discuss sweeping changes to border regulations, Canadian companies are welcoming the prospect of new measures to reduce trade bottlenecks.

“We need to restore principles of risk management at the border instead of checking everything and everyone all the time,” said David Bradley, president of the Canadian Trucking Alliance, which represents 4,500 trucking firms across the country.

Mr. Harper and Mr. Obama will “start a process rather than announce immediate changes, but any time we have a fresh look at the border, we have to welcome it. The proof will be in the pudding,” he said.

Mr. Bradley said a variety of security programs overlap when they should be harmonized, noting the Canada-U.S. border has “thickened” for truckers in recent years as they seek to comply with an array of rules introduced by the
U.S. and Canadian governments. Read more here.

News from TAHOCO: Weekly Updates


An updated list of recently published US government memorandums, notices, regulations and decisions for the week ending February 4, 2011 is now available on our website here.

IATA, ICAO and OAG Put Latest Dangerous Goods By Air Regulations Online

(eyefortransport)

Airlines, freight forwarders and shippers can now gain faster access to the latest regulations and information for the carriage of dangerous goods by air with the launch of DG Online by the International Air Transport Association (IATA), the International Civil Aviation Organisation (ICAO) and Official Airline Guide Cargo, a division of UBM Aviation (OAG Cargo).

DG Online combines the industry’s leading publications in an online format: The IATA Dangerous Goods Regulations Manual (DGR), the ICAO Technical Instructions (TI), and the ICAO Emergency Response Guidance manual (ERG).

DG Online features rapid referencing of all standards, advanced search functions by substance, subject / classification or by UN code, upcoming multi-language support, access to IATA Airline variations and
ICAO State variations, and real-time updating of the latest revisions of standards directly from IATA and/or ICAO.

Users can store favourites and create and print customised checklists to ensure packing and regulatory compliance and for the acceptance of shipments containing dangerous goods.

Some Countries Reportedly Insisting on Compliance with New Incoterms

(World Trade Interactive)

In a Jan. 20 letter, the International Chamber of Commerce notified the World Customs Organization of a problem that has arisen in connection with the Jan. 1 entry into force of Incoterms 2010, the first revision in ten years of the trade terms used worldwide in international and domestic contracts for the sale of goods. This update reduced the total number of terms from 13 to 11 and added two new terms: Delivered at Terminal (DAT) and Delivered at Place (DAP).

According to the ICC, national customs authorities in Argentina, Japan and Turkey are preventing certain goods from entering their territory because the accompanying documents make reference to an Incoterms 2000 term (DDU – Delivered Duty Unpaid) that no longer appears in the Incoterms 2010 rules. The ICC states that the customs authorities in these countries “apparently wrongly believe that companies are obliged to use the new Incoterms 2010 rules exclusively.” On the contrary, the letter points out, “there is no obligation for companies to incorporate the Incoterms 2010 rules into their contracts of sale, and indeed earlier versions of the Incoterms rules are still available for parties to use in their contracts if they so agree.”

To clear up this apparent misunderstanding, the ICC asked the WCO to “communicate on an urgent basis” to its member countries that “companies are not required to use the new version of the Incoterms rules in their contracts and customs documents, and that goods should not be stopped at national or other customs borders on the basis that they are being shipped under an old Incoterms rule.”

Harper, Obama Expected to Authorize Sweeping Overhaul of Canada-U.S. Security

(The Toronto Star – Les Whittington)

After months of secret negotiations, Prime Minister Stephen Harper and U.S. President Barack Obama are expected Friday to authorize the most sweeping overhaul of Canada-U.S. border and security cooperation in decades.

The agreement to be signed at a White House meeting will open the way to a bilateral pact with the potential to give Washington a much bigger say in Canada’s border security, immigration controls and information-sharing with American law agencies. [...]

Harper has said little about the talks but a draft of a six-page agreement prepared for his and Obama’s signatures authorizes officials from both countries to begin work urgently on “a shared vision for perimeter security and competitiveness.”

It would essentially see
Canada and the U.S. moving toward a shared security perimeter around the two countries. Besides improving anti-terrorist capability, the goal would be to unravel the increasingly congested Canada-U.S. border and ease bilateral trade.

“We share responsibility for the safety, security and resilience of
Canada and the United States and we intend to address threats at the earliest point possible, including outside the perimeter of our two countries,” says the draft agreement. Read more here.

Wednesday, February 2, 2011

U.S. Discovers the Undefended Border

(CBC News – Greg Weston)

Canada is once again being painted a code-red terrorist threat to the United States, this time after a U.S government watchdog agency discovered that the world’s longest undefended border is, ahem, largely undefended.

This week, the American government’s accountability office reported the obvious – most of the Canada-U.S. border is not exactly the Berlin Wall, especially the several thousand kilometres that run through wilderness and down the middle of the Great Lakes.

Nonetheless, the revelation prompted a couple of prominent American senators to proclaim the U.S. is facing a clear and present danger of terrorists pouring over the northern border from Canada. Senator Joe Lieberman, chairman of the powerful U.S. homeland security committee, called the report “absolutely alarming,” and suggested an urgent call for action by both countries. Republican Senator Susan Collins offered the analysis that terrorists wanting to enter the U.S. would “go for the weak link,” and therefore would be more likely to enter from Canada than from Mexico.

Lieberman added that the U.S. Department of Homeland Security has concluded the risk of terrorist activity is higher across the border from Canada than from Mexico. “Why? Because there are more Islamist extremist groups in Canada than in Mexico.” Read more here.

CPSC Extends Stay of Enforcement on CPSIA Testing

(Publishers Weekly – Karen Raugust)

The Consumer Product Safety Commission announced on Tuesday that it would extend the stay of enforcement on total lead content in children’s products, as dictated in section 102 of the Consumer Product Safety Improvement Act of 2008, until December 31, 2011. The vote was four to one, with Commissioner Robert Adler dissenting.

The stay had been scheduled to expire on February 10. “This is great news,” says Gary Jones, assistant v-p, environmental, health and safety affairs, Printing Industries of America. “Without the stay, it would have been complete chaos.”

Under the CPSIA, products for children under 12, including some books, must have a Certificate of Compliance showing they have been tested for acceptable total lead levels. The CPSC has not yet clarified the acceptable procedures for testing and certification, however; the extension of the stay gives it more time to issue these guidelines before the requirements are enforced. While most “ordinary” children’s books (those made of process inks on paper or board) do not need to be tested, novelty and book-plus formats, as well as titles incorporating PMS inks, laminates, foils, wire, non-animal-based adhesives and other components...
Read more here.

Upcoming U.S. Regulatory Actions on Trade in Food and Drug Products

(World Trade Interactive)

The Department of Health and Human Services recently issued its semiannual regulatory agenda, which includes the following Food and Drug Administration actions affecting international trade.

• March 2011 (from August 2010) – a proposed rule that would (a) define dietary guidance statements as statements in food labeling about the usefulness of a food or a category of foods in maintaining healthy dietary practices, (b) establish requirements for making dietary guidance statements in food labeling, and (c) provide guidance on how dietary guidance statements differ from other types of food labeling claims

• March 2011 – a proposed rule related to the implementation of tolerances for unapproved new animal drugs where edible portions of animals imported into the U.S. may contain residues of such drugs

• March 2011 – a proposed rule to establish updated standards for the labeling of pet food that include nutritional and ingredient information

• March 2011 – a final rule that will require owners or consignees to label imported food that is refused entry into the United States “UNITED STATES: REFUSED ENTRY”

• June 2011 (from December 2010) – a proposed rule requiring the label of medical devices to bear a unique identifier unless FDA specifies an alternative placement or provides for exceptions

• June 2011 (from December 2010) – a final rule requiring that manufacturers, importers and user facilities submit mandatory reports of medical device adverse events to the FDA in an electronic format that it can process, review and archive

• September 2011 – a final rule that will convert registration and listing for medical device establishments to a paperless process and reflect the requirement that foreign establishments provide FDA with additional pieces of information as part of their registrations

Reorganization Effort to Start with Trade, Export Agencies

(GovExec.com – Robert Brodsky)

The White House's government reorganization initiative will begin with an examination of federal agencies and offices that deal with trade and exports, Obama administration officials announced on Sunday. But observers of federal management suggest the president's plan could face stiff resistance from entrenched public and private sector communities hoping to retain their level of influence in the nation's capital.

The reorganization effort, first announced in last Tuesday's State of the Union address, is designed to eliminate redundancy in government operations by consolidating duplicative functions. More than a dozen federal agencies are involved in exports, administration officials said.

"They all work with well with each other, but this is certainly not the optimal organization or allocation of resources if you were designing a system from scratch," White House Communications Director Dan Pfeiffer wrote on the White House blog on Sunday.

"This government is structured basically mid-last century, not for the 21st century," White House Chief of Staff William Daley said in an interview with CBS' Face the Nation on Sunday. "There's enormous duplication, so I think you're going to see a very concerted effort by the president. No doubt about it. It's a major task." Read more here.

Profile of Canadian Exporters and Importers, 2009

(Statistics Canada)

Data from the Exporter Register Database are now available for 1996 to 2009. The database provides information on exporters by industry groupings, exporter size, province or territory of residence, country of destination and employment size.

Data from the Importer Register Database are also now available for 2002 to 2009. The database provides information on importers by industry groupings, importer size, province or territory of residence, country of origin and/or employment size.

Regulatory Actions Affecting Agricultural Trade Expected over Next Six Months

(World Trade Interactive)

The Department of Agriculture recently issued its semiannual regulatory agenda, which includes the following actions affecting international trade that are expected over the next six months.

• Under a proposed rule the Animal and Plant Health Inspection Service now plans to issue by the end of February, countries would be classified as negligible risk, controlled risk or undetermined risk for bovine spongiform encephalopathy. Some commodities would be allowed importation regardless of the BSE classification of the country of export, while others would be subject to importation restrictions or prohibitions based on the type of commodity and the BSE classification of the country.

• APHIS has postponed but expects to issue shortly a proposed rule imposing restrictions on the interstate movement and importation of live fish that are susceptible to viral hemorrhagic septicemia. This proposed rule will replace a previously published but not effective interim rule that contained substantially different restrictions.

• APHIS had planned to publish last October but is now anticipating by the end of March a proposed rule to amend the BSE and scrapie regulations to make further clarifications regarding the importation of live sheep, goats and wild ruminants and their embryos, semen, products and byproducts.

• A new APHIS proposed rule to regulate dogs imported for resale is expected in the near future. With certain exceptions, the importation of dogs for resale would be prohibited unless the dogs are in good health, have all necessary vaccinations and are six months of age or older.

• A Food Safety and Inspection Service proposed rule that would add Mexico to the list of countries from which fresh slaughtered poultry and egg products may be imported into the U.S. has been postponed until this November.

• FSIS has also delayed until November a proposed rule that would add China to the list of countries eligible to export poultry and poultry products to the U.S.

• FSIS is still working to issue in the near future a proposed rule that would amend the meat, poultry and egg products import inspection regulations to provide for an electronic application and electronic imported product and foreign establishment certification system. FSIS is also proposing to delete the “streamlined” import inspection procedures for Canadian product.

• FSIS also expects to publish soon a proposed rule that would (a) provide for an electronic export application and certification process that will be available for a fee, (b) provide establishments that export meat, poultry and egg products with flexibility in the official export inspection marks, devices and certificates, and (c) establish egg product export regulations that parallel the meat and poultry export regulation.

• The Foreign Agricultural Service has pushed back to June a proposed rule that would repeal all reference to the GSM-103 program and the Supplier Credit Guarantee Program and incorporate improvements and changes to the implementation and operation of the GSM-102 program.

• APHIS is still working to issue an interim final rule to prohibit or restrict the importation of birds, poultry and bird and poultry products from regions that have reported the presence in commercial birds or poultry of highly pathogenic avian influenza other than subtype H5N1. The new restrictions will be almost identical to those imposed on articles from regions with exotic Newcastle disease.

• An APHIS final rule establishing a new category in the regulations governing the importation of nursery stock, also known as plants for planting, is expected shortly.