Davos 2017 Results


2017 World Economic Forum Annual Meeting took place in Davos, Switzerland last week. It had more than 3,000 participants from nearly 100 countries, including over 50 heads of state or government who participated in some 400 sessions.

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The meeting has planned to focus on four key leadership challenges for this year: strengthening global collaboration, revitalizing economic growth, reforming capitalism and preparing for the Fourth Industrial Revolution.

Let’s see what the Davos meeting has achieved. 10 main results of Davos 2017:

1. Environment
There was a new public-private tropical forest fund launched. It will raise $400 million by 2020 to help small-scale farmers in forest areas protect five million hectares of land by reducing deforestation and peatland burning, whilst also improving their crop productivity.

2. China to green its economy
Chinese Ministry of Environment Protection signed an agreement with the World Economic Forum for a major five year collaboration on advancing China’s environmental policies, including bringing together leading companies, innovators and investors to help China accelerate a circular economy, promote the sharing economy, take further action on climate and oceans; and to harness new fourth industrial revolution technologies for the environment.

3. Tackling plastics pollution
Over 40 industry leaders including some of world’s largest consumer goods, retailers and recycling firms, and governments endorsed a detailed action plan to increase global reuse and recycling rates for plastic packaging from its current 14% to 70%.

4. Jobs
Signatories to the Forum’s New Vision for Arab Employment project said they have now helped re-skill 250,000 people since 2013, and are now targeting 1 million current and future workers.

5. Digital security
The World Economic Forum will join with the Boston Consulting Group (BCG), Kaspersky Lab and other partners to develop a playbook for governments to strengthen their capabilities in preparing for, responding to and recovering from cyber-attacks.

6. Health
Officially launched at Davos 2017, a new innovative public-private alliance – CEPI – will start on working to outsmart epidemics by creating vaccines that can be released quickly once an outbreak occurs.

7. Impact of automation
39 top technology companies, agreed to launch a consortium for the skilling of workers displaced by automation. The consortium will provide resources and capital and, through the World Economic Forum platform, focus initially on the financial services and manufacturing sectors.

8. Inclusive growth
A new Inclusive Growth Report was launched which will present a new global index to provide a richer and more nuanced assessment of countries’ level of economic development than the conventional one based on GDP per capita alone.

9. Responsible business leadership
The Compact for Responsive and Responsible Leadership – a roadmap for business leaders to pursue sustainable long term growth and opportunity, reached a tipping point at Davos with the first 100 compacts signed by leading companies.

10. World leaders ideas
Xi Jinping became the first ever Chinese president to participate in the Annual Meeting. In a major speech at the opening of the meeting, he said that globalization should not be blamed for the world’s problems and called on the international community to press ahead with implementing the Paris Agreement on climate change.
Henry A. Kissinger told participants in the closing session that Xi Jinping’s speech at the opening session was “of fundamental significance”.

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E-commerce in China


Chinese economy influence on global economy is indisputable now. One of the leading economies, Chinese label “Made in China” made the country the largest manufacturer in the world. And it has led the way in developing innovative processes that have fundamentally transformed production and supply chains. But China is changing.

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And a new lexicon may be in order: Digitized in China.
There are more social sites in China than any other country in the world. Chinese consumers use these sites to share, shop and consume in totally new ways. Talking has taken a back seat to texting. Wallets have been replaced by mobile devices. Hailing cabs is now done online.
Digital technologies are enabling innovation that is not only reshaping our personal lives, but redefining entire industries. And China is at the forefront of many of them.

Over the next year, this digital transition will accelerate. And China will lead the way. Here are three things you can expect:

1. The Business and Consumer Worlds will Collide
Companies across China are looking for ways in which they can run faster, simpler and smarter. Much like the social applications and networks that consumers use to manage their personal business, Chinese companies will tap into cloud-based applications and business networks to digitize their operations and manage everything from buying and selling to managing cash in a more efficient and effective manner.

2. The Universe will Get Bigger
Empowered by the easy and borderless collaboration that networks enable, Chinese companies will scale their operations and open new worlds of opportunities. In support of the One Belt and One Road initiative, corporate buyers will discover, connect and collaborate with a global network of partners to expand beyond sourcing materials locally. And suppliers will connect with profitable customers globally who are increasingly doing business online, opening new markets and revenue streams.

3. The Chinese Economy will Diversify
Chinese companies will leverage the massive investments the government is making in the building blocks of the Internet economy such as cloud computing, wireless communications, new digital platforms, big data analytics and the Internet of Things alongside business networks to fuel the next generation of smart manufacturing. Driven by more efficient, flexible and sustainable processes, companies will stimulate domestic demand growth and reduce the country’s reliance on exports, creating a more balanced economy.
Technology and networks have fundamentally altered the way we live and work. China has been instrumental in this digital transformation. And it will continue to drive it through investments in innovations that push the limits of what is possible and change the way business gets done.

[Based on the article by Gareth Bowen]

Morocco Trade Conference: SMEs and E-commerce


The bi-annual forum Trade Promotion Organization World Conference held in Morocco this year brought business leaders together to discuss the future of trade in today’s fast changing world.

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“The aim of this conference is to strengthen the role of trade organizations to boost and develop the exports and investments in all countries, especially in Africa, because they are the link in between the government strategies and between the private sector”, stated Zahra Maafiri, chief executive officer, Maroc Export.

This forum is a unique opportunity for global business leaders to share their experiences and take concrete steps to improve trade relations. It provides crucial support to firms struggling to swim in the digital waters.

“Logistics, distribution, payment system, taxation all this package, the international trade center will be putting together in order to help SMEs in the poorest countries and the most far away destinations to connect with the international market”, said Arancha González, executive director of the International Trade Center.

Participants have agreed on the importance of the transition to digital in the global business environment in the future. The most prominent challenge is to accelerate the development of the e-commerce sector and facilitate digital activities for SMEs, especially in the African continent.

Trade Logistics in the Global Economy


Many factors determine a country’s logistics performance – including infrastructure, regulations, policies, geography, and political economy.

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The 2016 edition of the new report Connecting to Compete 2016: Trade Logistics in the Global Economy includes The Logistics Performance Index (LPI) scores and benchmarks countries’ performance on logistics. Germany ranked first for the second time in a row, and Syria ranked last. The top performing countries tend to be high-income; countries with the lowest scores tend to be low-income.
The report covers 160 countries based on the multidimensional assessment of over 1000 global logistics professionals.

Global trade depends on logistics, and how efficiently countries import and export goods defines how they grow and compete in the global economy. Countries with efficient logistics can easily connect firms to domestic and international markets through reliable supply chains. Countries with inefficient logistics face high costs – both in terms of time and money – in international trade and global supply chains. This can severely hamper a nation’s ability to compete globally.

With so many factors involved in a country’s logistics, it can be difficult to conduct comparisons across countries. This is why the latest issue of the World Bank Group report captures critical information about the complexity of international trade. The index scores countries on key criteria of logistics performance, including border clearance efficiency, infrastructure quality, and timeliness of shipments, among others. For the second time in a row, Germany is the top performer, while Syria ranked last.

The scores are based on two sources of information: a worldwide survey of logistics professionals operating on the ground (such as global freight forwarders and express carriers), who provide feedback on the countries in which they operate and with whom they trade; and quantitative data on the performance of key components of the supply chain, such as the time, cost, and required procedures to import and export goods.

Main lines

– Top performing countries have remained relatively consistent since 2010. The top 15 performing countries have changed only marginally since 2010, and include dominant players in the supply chain industry, such as Germany, the Netherlands, and Singapore. The 2016 report ranked Germany the highest and Syria the lowest. Countries at the bottom of the rankings are either fragile economies affected by armed conflict, natural disasters, political unrest, or geographic constraints.

– The “logistics gap” between more and less developed countries persists. High income countries, on average, score 45% higher on the LPI than low-income countries. In previous editions of the report, the lowest performers appeared to be catching up. However, this trend reversed in 2016, and the gap between the top ranked countries and those at the bottom of the scale widened.

– Supply chain reliability continues to be a major concern for traders and logistics providers alike. Among the top 30 countries in the LPI, approximately only 1 in 10 shipments fail to meet quality criteria in the top 30 performers. Among the bottom 30 countries, nearly three times as many shipments fail to meet these standards.

– Income alone does not explain performance. The willingness to reform and implement good practices and policies can have a direct impact on fluidity of crossborder shipments. Examples like the Single Customs Territory in the East African Community, which allowed for steep reductions in clearance times along regional corridors, can be good examples of how such policy changes can have dire positive impacts on supply chain efficiency.

– Infrastructure continues to play a big role in assuring basic connectivity and access to gateways for most developing countries. In all income groups, survey respondents reported that infrastructure is improving. However, countries in the bottom quintile of LPI scores are improving at a much slower pace than those at the top of the scale. Regardless of income levels, logistics professionals are the most satisfied with ICT infrastructure and the least satisfied with rail infrastructure.

– Border management reforms are a serious concern. Countries at the bottom of the rankings continue to struggle with paperwork and long delays. This is especially true for low- income economies constrained by geography such as landlocked developing countries.

Historic Free Trade Deal Between Canada and the EU


The EU and Canada signed the comprehensive economic and trade agreement, known as Ceta, paving the way for most import duties to be removed early next year. However, the treaty needs the approval of at least 38 national and regional parliaments, including the UK’s, to take full force.

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Supporters of Ceta say it will increase Canadian-EU trade by 20% and boost the EU economy by €12bn (£10.9bn) a year and Canada’s by C$12bn (£7.4bn). Canadian PM Justin Trudeau said consumers and businesses would immediately feel the benefits.

With free trade under attack from populist movements and anti-globalisation campaigners, the deal reduces Canada’s reliance on the US and gives the EU a first trade pact with a G7 economy when its credibility has taken a knock from Britain’s decision to leave.

In spite of protests against free trade, we have to acknowledge that it brings its positive results. For example, if you take North American Free Trade Agreement (NAFTA). Here are some facts from the U.S. Chamber of Commerce you don’t often hear about NAFTA:

– Exports from U.S. service industries to Mexico and Canada tripled from 1993 to 2011
– U.S. agriculture exports rose by 258 percent to Canada and 408 percent to Mexico during the same period.
– About one-third of all U.S. merchandise exports are bought by those two countries.
– And, the jobs that Mexico has gained from NAFTA often depend on supplies from U.S. manufacturers. It’s been estimated that about $36,000 is generated annually for every American factory worker through Mexican and Canadian purchases of U.S. goods.

Trans-Pacific Partnership (TPP) and CETA are waiting their turn and chance as well.

Products Classification for International Trade


For exporting and shipping products all over the world producers and sellers have to take into consideration the main rules of international trade. Classification of the products is one of the important steps in the whole import and export process. It is a basic task to export, import or even for domestic trading.

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Standard International Trade Classification (SITC) is a classification of goods used to classify the exports and imports of a country to enable comparing different countries and years. The classification system is maintained by the United Nations.
The SITC is recommended only for analytical purposes – trade statistics are recommended to be collected and compiled in the Harmonized System instead.
Harmonized Commodity Description and Coding System or simply Harmonized System (HS) is effective since 1988 and is maintained by the World Customs Organization (WCO) and currently over 200 countries and economies make use of it.

HS Code is widely used in every international trade process. As an importer or exporter, it’s necessary to fully understand and make proper use of it.

Harmonized System proposes a logic organization of products classification, going from products economically less elaborated to ones with most added value. Therefore live animals are found at the beginning while machinery and precision instruments are listed in subsequent chapters.  The composition, form and function of the product are part of the classification model. The HS is structured in 21 sections and 97 chapters and those subdivided in approximately 5.000 headings and subheadings.

All references of HS to a given product are expressed by six digits. The first two digits indicate the HS chapter; the second two digits designate the headings and the next pair of digits the subheadings. Under the Harmonized System, all goods are subject to unique and unambiguous classification. It allows the classification even for merchandises yet to be produced.

Most of the countries that adopted the HS added two or four more digits to the initial six to accommodate specific needs of customs tariffs or for statistical purposes as well as to add their own Explanatory Notes.

Regional agreements or specific international commerce treaties may use other forms of product classification. That is the case of Mercosul the Southern Common Market, sub regional bloc formed by Argentina, Brasil, Uruguai, Paraguai and Venezuela. Mercosul uses the Mercosul Common Nomenclature (MCN), with eight digits, where the first six come from the Harmonized System and the two last digits are specific attributions within the Mercosul countries.

Pakistani Exporters Will Help the Country’s Economy


Economic situation of Pakistan became better than it was in 2013 and economic indicators were also encouraging said Chief Minister of Pakistani province Punjab Muhammad Shehbaz Sharif at an official meeting. He declared foreign exchange reserves had reached record level of 23 billion dollars in the history of the country.

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Although Pakistan was facing political problems and energy crisis, the country had been put on the road to progress thanks to the government measures.

The speech of the politician was full of hope for better future: “Pakistan is all of us and we have to make it developed jointly. We have to move forward for achieving a commendable place for the country in the comity of the nations.”

Chairman Punjab Investment Board Muzaffar Khawaja while speaking on the same occasion said that increasing exports of Pakistan, creating new job opportunities and promotion of investment was a mission of Punjab Board of Investment and all out steps were being taken in this regard.

Provincial Finance Minister Ayesha Ghaus Pasha while addressing the ceremony said that economic stability was impossible without increasing exports. She underlined that economy would be strengthened with exports growing which would result in creation of job opportunities and benefiting common man. She said the Punjab government and Finance Department would provide all out facilities to the exporters.

Secretary Industry, office-bearers of Lahore Chamber of Commerce & Industry and a large number of industrialists, traders and exporters participated in the ceremony.

Hopefully, the taken line will be kept on, and the world will discover more exports from Pakistan.