Obama's Trip to Egypt - Paving the Way for Increased Commerce

President Obama arrived in Egypt 5 days ago on June 4 to deliver a much anticipated speech on global trade between the US and Middle East. Fostering bilateral trade and investment could benefit both nations and help stabilize political relations.

Egypt is striving to become a trade hub in the Middle East on the strength of its favorable geographic location, purchasing power, and consumer culture. The United States is stuck in the worst recession since the 1930's, worsened by sluggish consumer spending.

Put the two together and benefits will flow. "Egypt can offer US companies many advantages, including a large domestic market of almost 80 million consumers and Egypt's many bilateral trade agreements with almost all major world markets," said Rachid Mohamed Rachid, Egyptian minister of trade and industry.

Egypt is the 36th-largest export market for U.S. goods, totaling $6 billion in 2008, up from $5.3 billion in 2007. U.S. imports from Egypt were down 0.3% last year to $2.4 billion.

Secretary of State Hillary Clinton promised strong US backing to promote economic opportunity in Egypt. "I want to stress economic opportunity because out of it comes confidence, comes a recognition that people can chart their own future," she said.

To read the full article, please visit the Los Angeles Times.

Dubai Quality Group Concludes Partnership with Ajman Free Zone Authority

Dubai Quality Group (DQG) announced that Ajman Free Zone Authority (AFZA) has entered into a strategic partnership agreement with the Group as an investor partner to enhance quality standards in the trade and business sector and boost the UAE’s position as a global trade destination.

Osama Al Rahma, Deputy Chairman of DQG Board, and Shaikh Mohammad Bin Abdullah Al Nuaimi, General Manager of Ajman Ports and Customs and Free Zone, signed the agreement at the headquarters of the Group.

Shaikh Mohammad said: “Our partnership with the Group comes in line with AFZA’s keenness to develop the quality standards of its services and programs to prepare an appropriate investment climate for investors.”

The agreement is aimed at enhancing quality standards in Ajman Free Zone in its capacity as a key contributor to the emirate’s economic growth.

To read the full article, please visit Al Bawaba.

Near-Sourcing: The Way Forward

In the immortal warning of the Jaws movie poster, ‘Just when you thought it was safe to go back into the water,’ so it is with near-sourcing.

“Last spring and summer,” recalls Charlie McGee, Vice President of International Development for Averitt, “near-sourcing was hot as firecrackers.” The competitive advantages that had been driving U.S. supply chains in a mad dash to China over the previous decade had seemingly all turned sour. Now, though, he’s seen that wave of enthusiasm begin to ebb.

The pressures to bring sourcing closer to home came to a focus when hefty ocean fuel surcharges (remember $150 a barrel oil?) were wiping out much of the savings from cheap labor. But compounding that difficulty was the rising levels of the ‘China price’ of goods themselves. With the economy flush, the government started eliminating the energy subsidies to domestic companies it had granted to spur production. There were other concessions to the pressures from global trading partners to level the playing field. Minimum wage laws were instituted (while demand pressures were putting workers in industrial regions in short supply, also pushing up pay). The melting of scrap into steel was subject to environmental oversight, adding costs. And hovering over the entire economy, like the perennial grey pollution, was inflation in basic commodities.

“Lots of people started to re-think their overall supply chains,” observed McGee. “Near-sourcing got pretty strong legs.” This was especially true with products which less labor intensive, like tooling and metals. The Americas started looking good again.

To view the full article, visit World Trade Magazine.

Vitality Predicted for European 3PL Sector

For many centuries, trade routes between Europe and major civilization centers in Asia have been bustling. Very early on, eager European consumers waited patiently for exotic food items, fabrics, gemstones and other luxury goods emanating from China and the Indian subcontinent. Brisk two-way trade later became well established and, in the 13th century, Marco Polo and his commercial peers further expanded trade along the legendary spice trails. A few hundred years later, the New World added yet another chapter to European trade history.

Container ships have supplanted caravans, and computers have replaced cardamom. Goods that transited for months over precipitous, treacherous trails or under sail now move in a matter of days via ocean and air.

However, certain trade essentials remain unchanged. European appetites for Oriental and Occidental goods continue unabated, and the world still looks to the European continent for leadership in manufacturing, fashion, and design.

In the accelerated environment of contemporary world trade, today's European shippers are turning increasingly to third-party logistics providers to facilitate and expedite their international transactions.

3PLs operating on the continent generally meet universal industry definitions as to their composition and function. The accepted description of a 3PL is a logistics entity that facilitates a transportation transaction but is not a primary beneficiary. Normally, they surpass the level of individual transactions to manage the larger transportation enterprise on behalf of the customer.

To read the full article on the 3PL sector in Europe, visit page 36 in the March 2009 edition of the Journal of Commerce.

Global Trade is Important Engine for Recovery

Reflecting on the ongoing debate of nationalization versus globalization in the margins of the recent meeting of European heads of state in Brussels, CEO DHL Express Europe, Scott Price, said: "Global trade is the engine for economic recovery and any move towards national protectionism creates the reverse. As a European industry we know that global trade is a job and growth facilitator and it is now more important than ever to underline this fact in order to encourage business, finance and not at last the European public to build up confidance again."

To view the full article, visit Outsourced Logistics at http://outsourced-logistics.com/global_markets/news/global-trade-recovery-0304/

Growing Together: Insider Perspectives on the NAFTA Nations' Economies

It has been more than 15 years since the United States, Canada, and Mexico signed the North American Free Trade Agreement, dramatically changing the region's trade prospects and economic reckoning. But is NAFTA leaving global trade dollars on the table by not being as competitive as it could be?

To answer that question, Inbound Logistics and sister publication Inbound Logistics México hosted a panel of North American trade and transportation experts. They recently met in Dallas to discuss the common trade interests among the three countries and to develop plans for fostering greater cooperation.

The group included the Canadian Consul General and representatives from the advocacy group North American SuperCorridor Coalition (NASCO), Mexico's Urban Land Institute think tank, the Mexican state of Nuevo Leon, the Port of San Antonio, and other organizations leading the drive for development in the three countries. The participants discussed the NAFTA partners' shared challenges, strategies for strengthening individual and collective economies, and the importance of logistics in the public and private sectors.

To find out how these thought leaders are coming to grips with the challenges facing the NAFTA countries, view the full article at Inbound Logistics at

http://www.inboundlogistics.com/articles/features/0109_feature08.shtml

Where's the Goods? Where's the Money?

Trust lies at the center of all trade finance transactions, but these days, with the credit crunch putting a dent in global commerce, safe harbors are in short supply.

Exporters offering payment terms to foreign buyers are more cautious, and banks that support cross-border sales are more stringent in managing the credit risks involved. Working capital and receivables finance, inevitably, are more expensive and less available.

That’s one reason why Supply Chain Finance (SCF) programs are increasingly popular. These strategies, which combine Internet platforms, software and programs, have been brought to trading operations over the past decade by a handful of large, global banks and a cluster of independent technology companies. SCF has demonstrated a capacity to mitigate risks and build trust, particularly in the huge Asia-U.S. and Asia-Europe trade routes on which it has been heavily focused.

It may be a critical, strategic moment for these banks and technology groups to expand their presence in the larger global trade arena. Some leading players in the field seem to think so.

To view the full article, visit WorldTrade Magazine at
http://www.worldtrademag.com/Articles/Article_Rotation/BNP_GUID_9-5-2006_A_10000000000000520081

Out-of-this-World Visibility

Those of you who really, really need to know exactly where your shipments are at all times might want to check this out. IHS, a company that provides data for such industries as aerospace, defense, and energy and parent of the economic research firm Global Insight, can track oceangoing ships by satellite. The satellites ping ships every six minutes to determine their location and track their exact path.

"It's like Google Earth for ships," said IHS Global Insight economist Scot Sigman during his presentation on global trade trends at the fall conference of the Coalition of New England Companies for Trade. Sigman showed a screen shot of the Western Hemisphere, with dozens of small yellow boxes representing ships, their paths up to that point depicted in one-day increments. He predicted that shippers would one day use the service to see in near-real time which ports are congested and whether or not ships are on schedule. Currently available only in the Western Hemisphere, the satellite tracking service is expected to be up and running worldwide in about 12 months.

To view the full article, visit DCVelocity at http://www.dcvelocity.com/news/article_id=2166&channel=4&source=fromVelocityTechWatch&utm_medium=email&utm_source=Email+marketing+software&utm_content=377074804&utm_campaign=TechWatch+2009+Jan+27+_+dtuuz&utm_term=out-of-this+world+visibility

Peru FTA Announcement

The Peru-US Free Trade Agreement was passed by the U.S. Congress on December 4, 2004 and signed by former President Bush on December 14, 2007. The agreement provides for reductions in tariffs and facilitates trade between the two countries. The FTA is effective February 1, 2009 and for imports on or after that date, most products (including textiles) from Peru will become duty-free immediately if they meet the FTA requirements. The agreement also contains provisions that provide for stronger protection in intellectual property rights, protection for U.S. investors in Peru, as well as commitments to internationally recognized labor rights.

The summary can be downloaded from the Meeks, Sheppard, Leo & Pillsbury website: http://www.mscustoms.com/Reference.htm.

2 Main Concerns for Importers & Exporters

Integration Point Inc.'s CEO, Tom Barnes, explains: "In the current global economy and political environment, there are two main concerns facing importers, exporters and the vendors who support them. The first is managing cost. The second is remaining competititve. In global trade terms, savings can be accomplished by managing inventories more carefully, reducing the time of transport, ensuring proper customs paperwork and minimizing tariffs. These opportunities require planning by the importer or exporter. They need comprehensive, up-to-date information and easy-to-use tools to make quick, accurate decisions as well as to increase visibility into their supply chain. Information must come from numerous third party sources and be compiled in a comprehensive manner. The collaboration of the various trade participants and effective tools that support the multiple languages of global trade are critical areas in which I expect to see accelerated progress in 2009."

The full article can be found in The Journal of Commerce 2009 Annual Review and Outlook.

High Priority: Trade Risk Management

Strong global competition and increasing regulatory requirements are leading companies to rethink their global trade management strategies. Increasingly more firms view trade management as a high-priority function.
"The trade business is evolving faster today than at any point in its history," Peter Tijou, vice president of product management with financial services firm J.P. Morgan's Global Trade Services group, wrote earlier this month.

Even before the recent recessionary circumstances in which companies everywhere have found themselves, organizations throughout the world have been feeling the effects of today's burgeoning global trade, a heightened regulatory climate and intense corporate interest in managing global risks and containing costs.

To view the full article, visit Thomasnet Industrial Newsroom at http://news.thomasnet.com/IMT/archives/2009/01/global-competition-regulations-making-trade-risk-management-high-priority.html