UK to Ban Huawei Equipment from its 5G Network While U.S. Announces Visa Restrictions

July 18th, 2020 Grant Leach and Camron Greer Leave a comment

On July 14, 2020, the United Kingdom announced that it will ban Huawei Technologies, Co. Ltd. (“Huawei”) equipment from its 5G network. Effective December 31, 2020, Telecoms operators in the UK can no longer purchase Huawei equipment and have until 2027 to remove Huawei technology from their networks, with broadband companies receiving an additional two years to do so. The older 2G, 3G, and 4G networks will not need to have existing Huawei equipment removed.

The UK’s decision arrives after UK intelligence determined that they could no longer be confident in the security of the new equipment provided by Huawei. This announcement marks a change in policy from six months ago, when UK Prime Minister Boris Johnson had previously agreed that Huawei could take up to a 35 percent share of the 5G market.

In response, U.S. Secretary of State Mike Pompeo tweeted that this decision by the UK’s decision “advances Transatlantic security in the [5G] era while protecting citizens’ privacy, national security, and free-world values.” Secretary Pompeo also announced that the U.S. Department of State will impose visa restrictions on Huawei employees, which, according to Secretary Pompeo, are meant to punish complicity in human rights abuses. Specifically, the new U.S. visa restrictions on Huawei employees allege that Huawei is an extension of the Chinese Communist Party’s “surveillance state” in the Xinjiang Uighur Autonomous Region.

Additionally, Huawei and 114 of its affiliate companies remain subject to extensive export restrictions due to their designation on the U.S. Commerce Department – Bureau of Industry and Security’s “Entity List” while the Commerce Department continues to finalize forthcoming “foreign adversary” rules which will likely restrict the use of Huawei equipment and services in various U.S. information and communications technology or services (“ICTS”) transactions (Husch Blackwell’s coverage of Huawei developments is consolidated at this link and we have covered the proposed “foreign adversary” ICTS rules here and here).

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Grant Leach is an Omaha-based partner with the law firm Husch Blackwell LLP focusing on international trade, export controls, trade sanctions and anti-corruption compliance.

Camron Greer is an Assistant Trade Analyst in Husch Blackwell LLP’s Washington D.C. office.

Archives, Global Trade Daily, News

Dubai Customs Tackles Counterfeit Goods Issue with Sustainable Approach

July 17th, 2020 GT Staff Leave a comment

Dubai Customs took piracy prevention and sustainable practices to a new level earlier this month when they recycled 1,906 counterfeit items including sports shoes, mobile headphones, and computers, according to a release from July 9th. This success represents one of many from Dubai Customs in addressing and putting a stop to the process of counterfeit goods in the region.

“The IPR Department works closely with different partners to curb counterfeiting in line with TRIPS agreement,” said Yousef Ozair Mubarak, Director of IPR Department. “The damage caused by counterfeit goods to the economy, environment, and even perhaps our overall quality of life should be something of a given for most people.”

“Perhaps Intellectual Property rights-holders are those most likely to feel the true pinch of this rogue industry, but when one considers the big picture it becomes clear that everyone is liable to be affected by counterfeiting and piracy,” he added.

Thanks to collaborative efforts between Color Code recycling company, CEO of Brand Owners’ Protection Group Malik Hanouf, and representatives from Air Cargo Centers Management, IPR Dispute Section, and External Relations Section, the items were successfully removed from further processing and used to support sustainable practices for the IPR Department at Dubai Customs.

“We take care of all information that helps us thwart all types of smuggling to protect our society from the hazards of illegitimate goods,” stated Shuaib Al Suwaidi, Director of Customs Intelligence Department. “Counterfeit goods are not welcome in Dubai and we work together with different partners to ensure they don’t enter the emirate.”

Photos provided by Dubai Customs

Archives, Global Trade Daily, Imports/Exports

The Global Spice Market Lacks to Regain its Former Momentum

July 17th, 2020 IndexBox Leave a comment

IndexBox has just published a new report: ‘World – Spices – Market Analysis, Forecast, Size, Trends and Insights’. Here is a summary of the report’s key findings.

The global spice market amounted to $33.1B in 2019, leveling off at the previous year. This figure reflects the total revenues of producers and importers (excluding logistics costs, retail marketing costs, and retailers’ margins, which will be included in the final consumer price). Over the period under review, the total market indicated a buoyant expansion from 2007 to 2019: its value increased at an average annual rate of +3.7% over the last twelve years. The trend pattern, however, indicated some noticeable fluctuations being recorded throughout the analyzed period. Global consumption peaked at $33.7B in 2017; however, from 2018 to 2019, consumption failed to regain the momentum.

Consumption by Country

India (4.8M tonnes) remains the largest spice consuming country worldwide, comprising approx. 37% of total volume. Moreover, spice consumption in India exceeded the figures recorded by the second-largest consumer, Indonesia (634K tonnes), eightfold. Bangladesh (543K tonnes) ranked third in terms of total consumption with a 4.1% share.

In India, spice consumption expanded at an average annual rate of +4.4% over the period from 2007-2019. The remaining consuming countries recorded the following average annual rates of consumption growth: Indonesia (+1.9% per year) and Bangladesh (+2.1% per year).

In value terms, India ($8.6B) led the market, alone. The second position in the ranking was occupied by Indonesia ($1.9B). It was followed by Ethiopia.

In 2019, the highest levels of spice per capita consumption was registered in Nepal (14 kg per person), followed by Thailand (6.25 kg per person), Viet Nam (4 kg per person) and Turkey (3.71 kg per person), while the world average per capita consumption of spice was estimated at 1.69 kg per person.

From 2007 to 2019, the average annual growth rate of the spice per capita consumption in Nepal amounted to +4.9%. The remaining consuming countries recorded the following average annual rates of per capita consumption growth: Thailand (+2.3% per year) and Viet Nam (+6.9% per year).

Market Forecast 2019-2030

Driven by increasing demand for spice worldwide, the market is expected to continue an upward consumption trend over the next decade. Market performance is forecast to retain its current trend pattern, expanding with an anticipated CAGR of +3.1% for the period from 2019 to 2030, which is projected to bring the market volume to 18M tonnes by the end of 2030.

Production

In 2019, the amount of spices produced worldwide rose modestly to 13M tonnes, growing by 4.3% against 2018 figures. Overall, the total output indicated moderate growth from 2007 to 2019: its volume increased at an average annual rate of +4.0% over the last twelve-year period. The trend pattern, however, indicated some noticeable fluctuations being recorded throughout the analyzed period. Based on 2019 figures, production increased by +60.2% against 2007 indices. Global production peaked in 2019 and is likely to see gradual growth in the immediate term. The general positive trend in terms output was largely conditioned by a temperate expansion of the harvested area and modest growth in yield figures.

Production by Country

The country with the largest volume of spice production was India (5.7M tonnes), accounting for 42% of total volume. Moreover, spice production in India exceeded the figures recorded by the second-largest producer, China (1.2M tonnes), fivefold. Indonesia (659K tonnes) ranked third in terms of total production with a 4.9% share.

In India, spice production increased at an average annual rate of +4.7% over the period from 2007-2019. The remaining producing countries recorded the following average annual rates of production growth: China (+3.7% per year) and Indonesia (+1.0% per year).

Harvested Area

In 2019, the global harvested area of spices amounted to 6.7M ha, increasing by 3% against the year before. The harvested area increased at an average annual rate of +2.4% over the period from 2007 to 2019; the trend pattern remained consistent, with somewhat noticeable fluctuations in certain years. The growth pace was the most rapid in 2016 when the harvested area increased by 7% y-o-y. Over the period under review, the harvested area dedicated to spice production reached the maximum in 2019 and is expected to retain growth in the near future.

Yield

In 2019, the global average spice yield was estimated at 2 tonne per ha, therefore, remained relatively stable against the previous year. The yield figure increased at an average annual rate of +1.6% from 2007 to 2019; the trend pattern remained consistent, with somewhat noticeable fluctuations throughout the analyzed period. The growth pace was the most rapid in 2011 with an increase of 8.4% y-o-y. The global yield peaked at 2 tonne per ha in 2017; afterwards, it flattened through to 2019.

Imports

For the sixth consecutive year, the global market recorded growth in purchases abroad of spices, which increased by 2.8% to 3.5M tonnes in 2019. Overall, total imports indicated a temperate increase from 2007 to 2019: its volume increased at an average annual rate of +4.6% over the last twelve-year period. The trend pattern, however, indicated some noticeable fluctuations being recorded throughout the analyzed period. Over the period under review, global imports reached the maximum in 2019 and are likely to continue growth in the near future.

In value terms, spice imports totaled $10.5B (IndexBox estimates) in 2019. In general, imports recorded buoyant growth. The growth pace was the most rapid in 2011 when imports increased by 25% year-to-year. Over the period under review, global imports also hit record highs in 2019 and are likely to see gradual growth in the immediate term.

Imports by Country

In 2019, the U.S. (428K tonnes), followed by Viet Nam (190K tonnes) and India (172K tonnes) represented the main importers of spices, together making up 23% of total imports. The following importers – Bangladesh (154K tonnes), Malaysia (142K tonnes), Germany (137K tonnes), the Netherlands (131K tonnes), Pakistan (129K tonnes), the United Arab Emirates (116K tonnes), Saudi Arabia (109K tonnes), Japan (107K tonnes) and the UK (104K tonnes) – together made up 33% of total imports.

From 2007 to 2019, average annual rates of growth with regard to spice imports into the U.S. stood at +3.9%. At the same time, Viet Nam (+28.4%), India (+8.2%), the Netherlands (+6.3%), the UK (+4.9%), Bangladesh (+4.6%), Saudi Arabia (+4.4%), Pakistan (+3.7%), Germany (+3.5%) and the United Arab Emirates (+1.3%) displayed positive paces of growth. Moreover, Viet Nam emerged as the fastest-growing importer imported in the world, with a CAGR of +28.4% from 2007-2019. Malaysia experienced a relatively flat trend pattern. By contrast, Japan (-1.0%) illustrated a downward trend over the same period. Viet Nam (+5.2 p.p.), the U.S. (+4.6 p.p.), India (+3.1 p.p.), the Netherlands (+2 p.p.) and Bangladesh (+1.9 p.p.) significantly strengthened its position in terms of the global imports, while the shares of the other countries remained relatively stable throughout the analyzed period.

In value terms, the U.S. ($1.7B) constitutes the largest market for imported spices worldwide, comprising 16% of global imports. The second position in the ranking was occupied by Germany ($597M), with a 5.7% share of global imports. It was followed by India, with a 5.1% share.

From 2007 to 2019, the average annual rate of growth in terms of value in the U.S. amounted to +8.3%. In the other countries, the average annual rates were as follows: Germany (+5.7% per year) and India (+12.1% per year).

Import Prices by Country

In 2019, the average spice import price amounted to $3,034 per tonne, therefore, remained relatively stable against the previous year. Over the last twelve-year period, it increased at an average annual rate of +2.7%. The most prominent rate of growth was recorded in 2011 an increase of 19% year-to-year. Global import price peaked at $3,430 per tonne in 2015; however, from 2016 to 2019, import prices failed to regain the momentum.

Prices varied noticeably by the country of destination; the country with the highest price was Germany ($4,374 per tonne), while Bangladesh ($1,132 per tonne) was amongst the lowest.

From 2007 to 2019, the most notable rate of growth in terms of prices was attained by Saudi Arabia, while the other global leaders experienced more modest paces of growth.

Source: IndexBox AI Platform

Archives, Global Logistics, Global Trade Daily

SUPPLY CHAIN COMPLIANCE CHALLENGES AND SOLUTIONS

July 16th, 2020 Haylle Sok Leave a comment

In the current trade atmosphere both domestic and international supply chain players have a myriad of concerns to consider while determining the next step in successful operations. Specifically, in 2020, these concerns have challenged shippers, carriers, manufacturers, distributors and other trade players to mitigate risk in new ways on an almost monthly basis.

The year kicked-off with the highly anticipated IMO 2020 regulation disrupting ocean shippers and carriers. IMO 2020 left many scratching their heads and trying to figure out the best way to navigate compliance and the latest trade tariffs without halting operations. For the most part, shippers were prepared, and IMO wasn’t nearly as scary as doomsayers made it out to be. However, for those that waited until the last minute to implement required changes, the transition left some compliance pains and costs that were avoidable.

Fast-forward to mid-January, and the appearance of the COVID-19 pandemic. Global trade and its supply chains were abruptly impacted, as the coronavirus started in China and eventually moved on to Italy, South Korea and other global markets. Businesses rapidly started temporarily shutting down amid a global panic. Supply and demand shifted while talk of force majeure slips—acknowledgements that contracts cannot be fulfilled due to unforeseen circumstances—shined a light of hope for the devastated Chinese suppliers. As of the second week in March, the National Trade Promotion System confirmed the issuance of more than 4,000 force majeure certificates as the U.S. prepared for the virus to disrupt domestic markets and business.

“The virus is the primary cause of the supply-chain impact but the secondary causes coming from the virus include financial, regulatory, compliance and legal,” explained David Shillingford with Resilience360 at the 2020 Modex conference. “One thing supply chains hate is variance, and there’s going to be a lot of variance and volatility on the demand side.”

So, what do these things have to do with compliance? The answer is all-encompassing. These and other disruptions will ultimately prove which players in the supply chain can stand the test of compliance and regulation risk mitigation and which ones are simply unprepared. For now, companies across the supply chain would be doing themselves a favor by reviewing regulations, disclosures and other compliance-related documentation and processes to ensure the highest level of compliance is achieved, if not already. As the National Law Review puts it in the article “Managing the Commercial Impact of the Coronavirus: An Effective Supply Chain Response Plan:”

Public companies should review and make accurate required disclosures, in the event that business operations are impacted such that a reporting requirement is triggered. All companies who are parties to credit agreements and other financing arrangements should review existing MAC clauses, and potential impacts on the borrower’s financial covenant compliance, in order to determine whether any proactive conversations with lenders may be warranted.

The takeaway is simple: Proactive measures should be in place among all links in the supply chain before, during and after major industry disruptions and changes in policy, regardless of the specific market operations. Factors including transparent communications, emergency planning and navigating an evergreen supply chain atmosphere can prevent costly fines and waste. Shifts in supply and demand are inevitable and it’s not a matter of if regulations will be accounted for, it’s a matter of when they will be accounted for. Don’t wait until your business is required to prove compliance. Instances like a global health crisis are one of many examples of how noncompliant companies can create unneeded delays or worse if found to be noncompliant. Visibility is key and it starts with your business knowing every moving part of the chain and your involvement with its success.

Visibility tools are every company’s best friend when it comes to compliance, providing a new level of security for both small and large-scale operations. Compliance issues come in a host of various forms from cyber risk and government sanctions to ethical trade practices and supporting sustainable practices and demand. And more recently, global supply chains have been shaken by natural disasters and global health concerns. Whether it’s a natural or unnatural occurrence, there’s no reason to be unprepared when it comes to compliance and preparation. These are all issues that require accountability on behalf of the partners involved. Ignorance is not excuse in the modern age where technology advancements, procurement and systems of checks and balances are created at each point.

“Knowing who you’re doing business with and ensuring your supply chain is compliant isn’t just a necessity; it’s good for the bottom line,” states Hemanth Setty, senior product director, Supply Chain Management & Compliance Solutions at Dun & Bradstreet, in his blog “7 Steps to Supply Chain Compliance.” Setty dives into why and how companies are challenged with a new list of onlookers requiring compliance and an ongoing approach rather than quick fixes to placate regulators.

He notes that the modern supply chain player now has “investors, suppliers, partners, customers and the media” to satisfy when it comes to compliance. Solutions presented keep department collaborations and meeting the expectations of customers at the top. But before a company can meet expectations, they must understand exactly what is expected and that requires transparency from the beginning, throughout the chain. This includes a pulse check on data and ensuring it’s up to date and preparing for the unexpected. Setty also advises that all corporate policies and procedures are understood across the board to avoid inconsistencies when onboarding new vendors and adding to the business.

The subject of compliance doesn’t have to be messy. In fact, the solution to many compliance issues is clear. When compliance is a priority in business, all other parts of the chain follow suit. Keep communications open and well understood, keep ethics at the forefront of operations, and be mindful of the changing regulations and potential disruptors that can easily shake the bottom line. Understand what expectations are and how critical it is to meet them. Utilize technology to support large-scale supply chains and eliminate mistakes with updated data and processes.

Archives, Dispatches, Global Trade Daily

ROADSTAR MILLION MILE SAFE DRIVER WINS LANDSTAR ALL-STAR TRUCK GIVEAWAY

July 16th, 2020 GT Staff Leave a comment

Every year, Landstar gives away a truck, including all registration fees and taxes, to a Million Mile Safe Driver independent owner-operator for the Jacksonville, Florida-based worldwide, asset-light provider of integrated transportation management solutions. However, due to the COVID-19 pandemic, July 8 was the first time the Landstar All-Star Truck Giveaway took place virtually, via Zoom video conferencing.

That did not dampen the excitement of Bobby Jordan, who a 2020 Freightliner Cascadia 126 at the 2020 Landstar All-Star Truck Giveaway sponsored by Pilot Flying J.

“Wow! Thank you very much,” said a very emotional Jordan, once he realized he’d won the giveaway truck. “Landstar has been good to me from the very beginning.”

The Soso, Mississippi, resident had been one of four randomly drawn “Roadstar” finalists. Roadstar is Landstar’s highest honor for truck owner-operators deemed the “best of the best” based on their high levels of safety, productivity and excellence in customer service.

Each finalist selected a box that they hoped contained the key to the giveaway truck. Jordan, who picked first, selected the box with the key that started his new viper blue Freightliner Cascadia with a suite of safety systems, fuel efficiency features, a Detroit DD15, 14.8-liter engine and a Detroit DT12 automated transmission.

Archives, Global Trade Daily, News

Driven by Rising Demand in Russia and Ukraine, the East-European Cucumber and Gherkin Market to See Solid Growth

July 16th, 2020 IndexBox Leave a comment

IndexBox has just published a new report: ‘Eastern Europe – Cucumbers And Gherkins – Market Analysis, Forecast, Size, Trends and Insights’. Here is a summary of the report’s key findings.

In 2019, the East European cucumber and gherkin market increased by 9.1% to $4.5B, rising for the third consecutive year after four years of decline. The total consumption indicated notable growth from 2007 to 2019: its value increased at an average annual rate of +2.4% over the last twelve years. The trend pattern, however, indicated some noticeable fluctuations being recorded throughout the analyzed period. Based on 2019 figures, consumption increased by +26.9% against 2016 indices.