Contents contributed and discussions participated by Kevin Yeo - Economic Challenges Research

shared by Kevin Yeo on 03 Jun 11 - No Cached

Canada has spent years -- and a considerable amount of money -- trying to convince exporters to look beyond the mighty U.S. market and seek customers in fast-growing emerging economies, such as China, India and Brazil.
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And to some extent, it’s worked. The United States accounted for 75 per cent of total exports last year, down from 85 per cent in the mid-1990s.
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But a new forecast of long-term export trends by the Department of Foreign Affairs and International Trade suggests the United States will still be our dominant merchandise export destination in 2040, grabbing virtually an identical share as today, at 75.5 per cent.
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shared by Kevin Yeo on 03 Jun 11 - No Cached

We have learned this month that the Canadian government is resisting efforts by the United States to increase exemptions for cross-border travellers in both countries. We believe this is a mistake. Canada’s interests are generally better served by lower trade barriers with the United States.
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First, under NAFTA, most products manufactured in the United States or Mexico are not subject to Canadian duties. Therefore, the duties collected are on the small fraction of goods manufactured overseas. Indeed, a 2007 Senate report noted that customs revenues amounted to just $95-million annually – just 0.04 per cent of federal revenues.
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Cross-border purchases pressure Canadian retailers to be more competitive and provide better, cheaper services to Canadian shoppers.
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we must recognize that public policy should be designed to benefit all Canadians, rather than a few large retailers. The currencies of resource exporters such as Australia, Canada and Brazil have appreciated sharply in recent years. We should all enjoy the higher standard of living the strong dollar entails, rather than allowing retailers to monopolize these benefits.
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Therefore, we must embrace, rather than reject, the economic forces that drive the new U.S. thinking on this issue. Matching the $1,000 exemption would help Canadians realize greater gains from trade, while allowing CBSA to focus on its core mission.
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shared by Kevin Yeo on 03 Jun 11 - No Cached

Two-way trade between the United States and Canada amounted to nearly $750-billion in 2008 before falling to $600-billion in 2009, thanks largely to the decline in energy prices and weakness in the auto sector; in both areas, Canada is the United States’ largest foreign supplier.
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Thus, Canada’s $100-billion drop in exports to the United States between 2008 and 2009 was three times as large as the decline in Canada’s GDP during that period.
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The point is not that internal trade flows or barriers to them are unimportant: in large countries, in particular, internal trade is often significantly larger overall than international trade and therefore even relatively small impediments to it can matter a great deal.
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shared by Kevin Yeo on 03 Jun 11 - No Cached

The rise in the oil deficit did indeed greatly outpace the rise in the overall deficit for March – 22.78 percent versus 6.03 percent.  But the increase in the deficit for high-tech products also surged – by 17.00 percent.  And the manufacturing deficit grew by 6.24 percent.
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But deficits in these sectors kept increasing because their much larger import levels rose robustly, too.  Meanwhile, for the first quarter of this year, the overall trade deficit is running  23.46 percent ahead of last year’s comparable total – which in turn was up 25.91 percent from the first quarter 2009 number.
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In March alone, U.S. exports of high tech products jumped by 20.26 percent (from $21.01 billion to $25.27 billion), while manufactures exports overall rose even faster – by 21.57 percent (from $71.56 billion to $86.99 billion).  
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Bottom line: Despite genuinely booming imports, trade flows still kept dragging down America’s growth and employment performance, and still kept boosting the country’s debt burden.  Do these trends really deserve the label “recovery”?
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shared by Kevin Yeo on 03 Jun 11 - No Cached

Perry also said that, at $2.155 trillion, total U.S. manufacturing output is 45% higher than China's. Despite the increase in output, however, the number of jobs in the U.S. manufacturing sector is down more than 7 million since the late 1970s.
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But when asked if large corporations have a responsibility during these tough economic times to buy American to create more American jobs, his answer was clear: No.
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Some have argued the "Made in USA" label is too exclusive and can actually hurt the economy by discouraging consumers from buying goods that are not completely made within US borders, but which benefit the country by creating jobs or promoting innovation.
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