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Economic Digest

Business Without Borders ®

Economic Digest – February 2017


Artisanal charcoal will become the first legal Cuban export to the US in decades under a recent deal. The charcoal is made from the invasive woody plant marabu. The charcoal is produced by hundreds of worker-owned cooperatives across Cuba and has become an increasingly profitable export, valued for its clean-burning properties and often used in pizza and bread ovens. Cuba sells about 60,000 tonnes of marabu charcoal annually to buyers in Italy, Germany and about half a dozen other countries.


Wildfires in Fort McMurray, Alberta and flooding in Atlantic Canada were driving factors behind a record C$4.9-billion in insurable damage last year. This was about $1.7-billion higher than the previous year’s record of $3.2-billion set in 2013. Canada’s most costly disaster last year was the northern Alberta wildfire that  forced the evacuation of Fort McMurray and surrounding areas, reducing to charred rubble 1,800 single-family homes and numerous other structures including buildings containing about 600 apartments or condo units. The hit to insurers from the fires was $3.7-billion, three-quarters of the national total for the year and twice as expensive as the precious most-expensive natural disaster in Canada on record.   


It is estimated that about 1,500 different varieties of cheese are made around the world. France dominated the cheese world for centuries but is now merely the third largest producer after America and Germany, with other countries such as Australia and Britain diversifying their production in recent years. Curiously there has been no strong tradition of cheese-making or consumption in most of Asia. Cheese accounts for a tiny part of the Indian diet even though India is the world’s largest dairy producer. For centuries, Japan never consumed dairy products. Cheez Whiz, a post war cheese dip created by Kraft has seen better days but still generates revenues of US$100-million a year. Ever willing to move with the times, it has just been released in a spray can with both Sharp Cheddar and Buffalo Cheddar flavours


Canadians and Americans wore out the showroom floors in 2016, driving automakers to record sales years in both markets. Auto makers sold 1.95-million vehicles in Canada, the fourth consecutive year that sales have hit a record. The 2016 level was achieved despite a plunge in oil prices that sent sales tumbling in Alberta, the third largest market in the country. The US market hit a record 17,539-million, a fraction higher than the 2015 level. Ford Canada captured first place in the Canadian sales race with a nine per cent increase in deliveries and sold three times as many F-series pickups as cars. In Canada, crossovers, pickups and traditional sport utility vehicles grabbed a record 70 per cent of the market last December.


Amazon Co. has filed for a patent to use airships to store products and serve as a base for delivery-drones. According to the patent filing, drones launched from the so-called “airborne fulfilment centres” (AFC) would use far less power than those launched from the ground. The AFC’s would hover at about 13,700-metres and be restocked and resupplied by shuttles or smaller airships.


Conservationists are saying it is time to act to save the Canadian Prairies, which are disappearing off the face of the earth, faster than the Amazon rainforest and the Great Barrier Reef. More than 70 per cent of Canada’s prairie grasslands have been converted for other uses. Grasslands cover eight per cent of the world’s surface, but they have shrunk approximately 40 per cent globally. Some of the world’s most significant remaining grasslands are in Canada but they could soon disappear unless more is done to save them. Millions of migratory birds spend time in the Prairies each year and more than 60 rare species call the habitat home.


The total value of honey produced in Canada fell from C$211-million in 2015 to $158-million in 2016, a decrease of 25 per cent. The decline in value was attributable to lower prices received at farms which is blamed on a global glut of what some say is cheaper, low-quality Chinese exports. In Alberta, the largest honey-producing province, honey value declined 32 per cent and in Manitoba, the value was down 35 per cent. Production was 92-million pounds both in 2015 and 2016 and the number of colonies increased 3.3 per cent from 2015 to 750,155. On average, each colony had a yield of 123 pounds of honey. There were 9,859 beekeepers in 2016, 1,244 more than in 2015. 


A team of scientists from the University of Cambridge has developed the world’s smallest magnifying glass that can focus on light a billion more times, letting you see even single atoms. The new invention breaks the previous assumption that it is impossible for light to be focused down smaller that its wavelength. The new discovery could lead to new ways in studying the interaction between light and matter


On some Canadian farms, thousands of pigs are getting five-star treatment. Japan’s growing appetite for pricey pork cuts are driving Canadian and US fresh pork exports to record levels, spurring producers to use every advantage to gain market share. While many pigs gobble pedestrian wheat and barley, others dine on rations spiced with mint and ginger and some Canadian pigs are indulged with 12 times more rest before slaughter than pigs destined for other markets, to ensure stress does not turn the meat dry. One Japanese trading house has doubled chilled pork imports from Canada during the past five years and plans a further boost of 20 per cent this year.


More than C$78-million were paid to farmers who grew Christmas trees last year, up 21.6 per cent from the year before. The industry is concentrated in Quebec, Nova Scotia and New Brunswick, which together supply 98.7 per cent of the market. 88.8 per cent go to the United States and are worth $37-million while Canada imports C5.7-million worth of trees from the United States. Canada also exports some trees to the Caribbean as well as Russia and Venezuela. The value of artificial Christmas trees imported to Canada was $65.2-million of which $64-million are from China. 


The latest quest to boost productivity is playing out at a busy food court in Singapore’s Changi Airport. There, hungry passengers can select their chicken rice or bowl of noodles from a machine, pay with a credit card and collect their food, all with minimal human interaction, in stark contrast with the abundant manpower commonly used in food courts around the world.  With authorities restricting the inflow of foreign workers after a backlash against immigration, Singapore is increasingly turning to machines to replace low-end manpower. The food industry has been targeted because it is among the least productive in the city-state. It accounts for 0.8 per cent of gross domestic product, but employs 160,000 workers.


It has sent rockets into space, produced millions of the world’s smart phones and built high-speed trains but until now, one bit of manufacturing has eluded China: the ballpoint pen. The problem is not the body of the pen but the tip, the tiny ball that dispenses ink as you write. Making them requires high-precision machinery and very hard, ultra-thin steel plates. So far, China’s steel has not been good enough. Without this ability, China’s 3,000 pen makers have had to import this crucial component from abroad, costing the industry US$17-million annually.  Despite producing more than half of the world’s crude iron and steel, China still relies heavily on imports for high-grade steel.


According to the World Health Organization, smoking costs the global economy more than US$1-trillion a year and will kill one third more people by 2030 than it does now.  The costs far outweighs global revenues from tobacco taxes, which WHO estimates at about $269-billion in 2104. The number of tobacco-related deaths is projected to increase from about 6-million deaths annually to about 8-million by 2030. More than 80 per cent of these deaths will occur in low and middle income countries. Health experts say that tobacco use is the single most preventable cause of death globally.


Norway is set to become the first nation to start switching off its FM radio network in a risky and unpopular leap to digital technology that will be closely watched by other countries. 67 per cent of Norwegians oppose switching off FM and there are 2-million cars on the road that will miss warnings on emergencies because they are not equipped with Digital Audio Broadcasting (DAB) receivers. Switzerland plans a similar shift from 2020 and Britain and Denmark are also considering a switch.


High-powered laser light will be used to protect crops from pests in a trial funded by the European Commission. Researchers hope that a “fence” of laser light will scare rats and other pests, proving an alternative to poison.  It already works well with birds and it is hoped it will deter badgers, foxes and rabbits too. Controlling pests with poison can lead to unintended victims such as birds


China has launched a direct rail freight service to London, as part of its drive to develop trade and investment with Europe. China already runs services between China and other European cities, including Madrid and Hamburg. The train will take about two weeks to cover the 12,000 mile journey and has the advantage of being cheaper than air freight and faster than sea. Because of the different railway gauges involved, a single train cannot travel the whole route and the containers need to be reloaded at various points.


Africa has the highest rate of high blood pressure in the world, affecting about 46 per cent of adults. The rise in cases is increasingly being blamed on urbanisation and unhealthy lifestyles. High blood pressure is often detected too late and is a silent killer. If lifestyles in Africa do not change, more people will die from chronic illnesses, including diabetes and cancer, than infectious diseases by 2030.


BC wine lovers will soon be able to select wines according to a specific sub-region in the province, according to new rules enacted by the provincial government. The label rules apply to BC VQA (Vintners Quality Alliance) wines, those made from 100 per cent BC grapes with 85 per cent of the grapes from the region specified on the front label. There are over 340 wineries in the province. Wines can vary significantly depending on the natural environment the grapes are grown in.


The leaders of four major global cities say they will stop the use of all diesel-powered cars and trucks by the middle of the next decade. The mayors of Paris, Mexico City, Madrid and Athens say they are  implementing the ban to improve air quality. They also say they will give incentives for alternative vehicle use and promote walking and cycling. The use of diesel in transport has come under increasing scrutiny in recent years


Scientists at Oxford University have developed a machine that can lip-read better than humans. The artificial intelligence system, LipNet, watches video of a person speaking and matches the text to the movement of their mouths with 93 per cent accuracy. Automating the process could help millions. Machine lip-readers have enormous potential, with applications in improved hearing aids, silent dictation in public spaces, covert conversations, speech recognition in noisy environments and biometric identification


Cuba has come up with an unusual offer to repay its multimillion debt to the Czech Republic with bottles of its famous rum.  Cuba owes the Czech authorities US$276-million and if the offer is accepted, the Czechs would have enough Cuban rum to last a century.

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