Economic Digest – February 2018
Insurers will have to pay claims of around US$135-billion for 2017, following a spate of hurricanes, earthquakes and fires in North America. German insurer Munich Re reports that last year’s total losses worldwide, including those not insured, were $330-billion, the second worst in history after 2011, when an earthquake and tsunami wreaked havoc in Japan. Although individual events could not directly be linked to climate change, Munich Re expects more frequent extreme events in the future.
Canada’s two largest airlines have some work to do to make the list of the world’s most punctual airlines. Neither Air Canada nor WestJet Airlines ranked among the top airlines for on-time performance in 2017. Air Canada’s on-time performance stood at 67.32 per cent last year, while 76.18 per cent of WestJet flights arrived within 14 minutes and 59 seconds of their scheduled landing times. Those numbers compare with global leader airBaltic of Latvia which hit the 90.01 per cent level and Mexico-based low-cost carrier Volaris whose on-time performance stood at 82.13 per cent. Air Canada took 17th spot among mega-airlines which includes the four largest US carriers. That category was led by Japan Airlines with an 85.27 per cent on-time performance.
In 1674 an English glass merchant discovered that adding lead oxide to the melt resulted in a clearer, more durable product. Thus was born lead crystal and with it the fashion of drinking wine from glass vessels rather than pewter ones. Researchers have recorded the volumes of glasses going back to 1700 and have found a near-continuous tendency for the volume of the capacity to increase since 1683. There is also a notable acceleration of the process starting in about 1990. In all, the average capacity of a wine glass increased from 66ml in the 1700s to almost 450ml in 2016-17. This volumetric inflation has stimulated wine consumption. The amount of wine consumed in Britain has risen more than sevenfold since 1960, while the population has grown by only 25 per cent.
Dollarama Inc has 1,135 locations across Canada selling merchandise at prices up to C$4.00 and reported an 18 per cent climb in profits in the last quarter of 2017 over the previous year to 130-million. Now, Dollarama is to dip its toes into e-commerce offering a collection of popular items in bulk as the Canadian discount retailer responds to customers clamouring for bigger volumes of goods than it carries in its stores. The aim is to cater to clients looking to buy a big batch of things, such as party planners looking for cheap wine glasses or schools needing cheap notebooks. Dollarama is piloting its e-commerce with institutions such as schools which will bring it into competition with Wal-Mart and Costco.
Many mall owners in the US are spending billions to add more upscale restaurants and bars, premium movie theatres with dine-in options, bowling alleys and similar amenities. Some have turned large spaces that previously housed department stores over to health clubs and grocery stores. Others are undergoing no less than a ground-up transformation to make room for office space, hotels and apartments. The trend has been gaining traction as companies that operate malls look for ways to keep people coming in at a time when several big department store chains have closed hundreds of stores and consumers increasingly opt to shop online. Last year, 13 per cent of the space was occupied by non-retail tenants in US regional malls up from 10.5 in 2012.
China has more than doubled its purchases of Canadian barley, taking advantage of bargain prices for the beer ingredient because of abundant high-quality supplies in Canada. The extra sales come at the expense of Australia and Europe, the world’s two biggest barley-exporting areas, where harvests have been disappointing owing to a mix of drought and excessive rains. Canada is the world’s sixth-largest barley shipper. In one quarter last year, one record large shipment from Canada of 400,000 tonnes was up from 158,000 tonnes a year earlier.
Travellers may attribute Spain’s late mealtimes to the country’s laidback Mediterranean attitude; however the real reason seems to be a little more peculiar. Glance at a map and you realize that Spain, sitting as it does, along the same longitude as the UK, Portugal and Morocco, should be in Greenwich Mean Time (GMT). But Spain goes by Central European Time (CET), putting it in sync with the Serbian capital Belgrade, more than 2,500km to the east of Madrid. In 1940, General Franco changed Spain’s time zone, moving clocks one hour forward in solidarity with Nazi Germany and after World War 11 ended, the clocks were never changed back. Being 60 minutes behind the correct time zone means the sun rises later and sets later.
The best selling fruit in Britain are now grapes for the first time ever overtaking apples. The rise of the increased popularity is attributed to “snack packs.” A record US$821-million was spent on grapes in 2017, while $810-million was spent on apples and $750-million on bananas The rising popularity of grapes is due to consumer lifestyles with just a handful of grapes being considered a healthy and convenient snack for lunchboxes.
The world’s donkeys are facing a population crisis because of the huge demand for their skins in China, where they are used to make health foods and traditional medicine. Donkey meat is also a popular food but a huge drop in the number of Chinese donkeys and the fact that they are slow to reproduce has forced suppliers to look elsewhere. Africa has been badly hit because the animals are such an important part of life for transport and farming, particularly in poorer communities. In many places the price of a donkey has doubled in the past few years and as thieves cash in, families are left unable to afford a new animal. Recently China has reduced the tariffs on the imports of donkey skins.
Ontario businesses sold almost C$2-billion worth of environmental and clean technology goods manufactured in Canada in 2016, the most of any province. Quebec was second at almost three-quarters of a billion dollars in sales. Together, the two provinces accounted for more than three-quarters of all domestically manufactured technology goods. British Columbia sold $121-million and Alberta $135-million. In BC, 42 per cent ($68-million) of revenues were generated by sales of smart grid and energy storage technologies.
Britons spend over 65 per cent more on clothing than the famously chic French according to a new survey. The average Briton shells out more than US$1,357 on new clothes and shoes each year, while the average French person devotes a mere $815 to achieve the look that others covet. Expenditure on clothing and shoes accounted for only 3.7 per cent of the average household budget in France compared to 5.6 per cent in Britain in 2016. Between 2006 and 2016 the proportion of British household budgets spent on clothes rose by 0.5 per cent, whereas in France it fell by 0.8 per cent.
More skyscrapers were built in 2017 than during any other year in history. A total of 144 buildings measuring 200 meters (656 feet) or taller were completed in the world, up on 2016s record by more than 13 per cent. China once again dominates the list accounting for more than half of the year’s global total. The Chinese city of Shenzhen saw the completion of 12 such buildings in 2017 including the Ping An Finance Center, now the world’s fourth tallest building at 599 metres (1,966 feet).
A Japanese firm is planning to use a drone to force employees out of their offices by playing music at them if they stay to work evening overtime. The camera-equipped drone will fly through offices playing Auld Lang Syne, which is commonly used to announce that stores are closing. Japan has for years been trying to curb excessive overtime and the health issues and even deaths it can cause. The problem of long hours has even led to the coining of a new word: karoshi, or dying from overtime.
UK cotton is back in production in Manchester ending a 40-year hiatus. The city and surrounding region was built on the success of spinning and sewing during the industrial revolution. But as production slowed and moved offshore, the big red mills fell silent. After a US$8-million investment one textile manufacturer has started spinning cotton imported from the sunny fields of southern California producing yarn that is being used across the region in a newly reopened supply chain.
One of the world’s last telegram operators is mourning the death of the service after Belgium announced it would finally stop after 171 years. Belgium was one of the last countries still offering the service. Britain, which invented the telegram in the 1830s, stopped it in 1982. India, once by far the world’s largest telegram market stopped their system in 2013, seven years after the US sent its last. In the early 1980s as many as 1.5-million telegrams were sent and received each year. By the 1990s traffic had dropped to half a million and last year the number had dwindled to just over 8,000 messages.
A researcher from UBC says grocery chains across the country are cashing in on the demise of the penny and making C$3.27-million from penny-rounding. Ottawa announced plans in 2012 to phase out the copper coin, and as a result, cash purchases are now rounded up or down to the nearest five-cent increment. Canadian consumers do not end up paying much extra but the rounding up on cash transactions can mean big money for grocery retailers across the country.
San Francisco officials have voted to restrict where delivery robots can go in the city, in a blow for the burgeoning industry. Start-ups will have to get permits to use such bots, which will be restricted to less crowded urban areas. Opponents are concerned about the safety of pedestrians, particularly elderly people and children. One group that campaigned for pedestrian safety wanted a complete ban. Despite its proximity to Silicon Valley, San Francisco is falling behind other states such as Virginia and Idaho where there are already laws permitting delivery robots to operate.
The OECD warns that rising private debt loads in both advanced and developing countries pose a risk to growth as Canada, South Korea and the UK lead the world in household borrowing. Canada’s consumer debt has started to rise as consumers took
advantage of low interest rates over the past seven years. Consumer debt tops 100 per cent of gross domestic product in Canada, with South Korea and Britain both above 80 per cent.
The traditional home pregnancy test could soon be obsolete as scientists have announced that a new smart watch system has been developed that alerts women when they conceive. Trials in Switzerland have allowed researchers to identify for the first time, a package of minute physiological changes, detectable by existing hardware, that take place when pregnancy starts. They are now building an algorithm which learns the individual wearer’s personal characteristics so it can not only signal the start of a pregnancy but also highlight the best windows in which to try for a baby.
Cans of Spam have become a common item that is being stolen from Honolulu stores and then sold on the streets for quick cash. Hawaiians eat millions of cans of Spam a year, the nation’s highest per-capita consumption of the processed meat, which is cobbled together from a mixture of pork shoulder, ham, sugar and salt. The state’s love affair with Spam began during World War 11 when rationing created just the right conditions for the rise of a meat that needs no refrigeration and has a remarkably long shelf life.
Nothing is more likely to make a groom nervous on his big day than the bride showing up late; it can also irritate the vicar. So, two churches in Kent, England are offering a US$136 reduction in church fees if a bride walks down the aisle within 10 minutes of their scheduled service.