Topic Category: Trade & Finance

In our ultra-competitive world of globalization, nations are increasingly teaming up to achieve higher levels of competitiveness and greater economic growth. And as the deepest and longest recession since the Great Depression recedes—creating new economic realities—this is even more important. Unfortunately, the U.S. isn’t keeping pace with other countries. In fact, it’s significantly falling behind.

Currently, the United States is a party to only 11 active free trade agreements involving 17 countries. Today, there are well over 300 existing free trade agreements in force around the world without U.S. participation. And dozens more are being negotiated at a swift pace while the U.S. sits on the sidelines. This is putting American companies at a competitive disadvantage.

Topic: Trade & Finance
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The global economic crisis may have left many companies in China and elsewhere struggling to shore up their bottom lines, but this has not ruined their appetite for mergers and acquisitions (M&As).

M&As To Remain Strong in 2009

China had a record $164.3 billion M&A deals announced in 2008, up 18 percent from a year earlier. And this was the case even though China’s gross domestic product growth rate fell from 13 percent in 2007 to 8 percent in 2008.

Topic: Trade & Finance
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Since the establishment of diplomatic ties 18 years ago, Singapore and China have developed one of the strongest and most dynamic trading relationships in the world. The signing of the Singapore-China Free Trade Agreement (SCFTA) on October 23rd, 2008 not only marked a significant milestone in the evolution of trade relations between these flourishing economic heavyweights, but also created a plethora of opportunities for countries that trade with Singapore or China or both.

Topic: Trade & Finance
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From 2002 through late 2007, the U.S. dollar declined 39 percent against the Canadian dollar, 38 percent against the euro, and 30 percent against the British pound, according to Deloitte Research. Interestingly, the impact is different than it would have been years earlier.

Topic: Trade & Finance
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The most important and contentious trade vote in Congress this year will probably be the free trade agreement the United States has signed with its South American neighbor and ally, Colombia. In his January 28, 2008, State of the Union speech, President Bush called on Congress to approve the agreement this year.

Calling Colombia “a friend of America that is confronting violence and terror, and fighting drug traffickers,” the president warned Congress that “if we fail to pass this agreement, we will embolden the purveyors of false populism in our hemisphere. So we must come together, pass this agreement, and show our neighbors in the region that democracy leads to a better life.”

Topic: Trade & Finance
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If all significant trade barriers were unilaterally removed on foreign products, U.S. welfare — as defined by public and private consumption — would increase by approximately $3.7 billion annually. Additionally, U.S. gross domestic product would rise by $1.6 billion, according to a 2007 study by the United States International Trade Commission.

Topic: Trade & Finance
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“Trade liberalization has a critical role to play in economic growth by directly stimulating domestic firms to become more productive,” so says the U.S. Federal Reserve. As a result, the incomes of ordinary people typically rise.

Topic: Trade & Finance
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In May 2003, a task force commissioned by the International Chamber of Commerce (ICC) began work on revising rules governing letters of credit, with a target date of July 1, 2007. The new regulations are expected to eliminate barriers that have increasingly hampered international trade.

As commerce among nations grew in the early 20th Century, conflicting laws governing letters of credit among countries became major barriers to expansion. The ICC in 1933 created the first Uniform Customs and Practice for Documentary Credits (UCP) rules that brought uniformity to letters of credit.

Topic: Trade & Finance
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When market participants attempt to predict currency shifts, they must be wary of applying outmoded assumptions. Projecting currency moves has become increasing challenging in globalized markets. A misinterpretation of trends can lead to poor business decisions.

Fading Currency Assumptions

It is also increasingly difficult to predict the impact currency shifts may have. For example, it used to be thought that as the U.S. dollar fell against other currencies, American exports benefited. That’s because U.S. goods became less expensive when prices were translated into foreign currencies. As a result, American manufacturers became more competitive abroad. At the same time, a relatively weaker U.S. dollar was expected to lead to increased prices in imported goods. For a variety of reasons, these assumptions may be outdated.

Topic: Trade & Finance
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As trade between nations rapidly increased in the early part of the 20th Century, a major barrier to expansion were conflicting laws governing letters of credit among countries. In 1933, members of the International Chamber of Commerce (ICC) created the first Uniform Customs and Practice for Documentary Credits (UCP), a set of rules that brought uniformity to letters of credit.

Since its inception, the UCP has become the most successful private set of rules for trade ever developed. Now firmly established, the UCP continues to remain an essential component in international trade. It establishes the conditions under which the majority of banks operate in documentary commercial credit transactions in more than 160 countries.

Topic: Trade & Finance
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