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#ff00006 Wisconsin Worldwide #0000ff Volume 4, Issue 3: May 2003
#ff00005In This Issue:
-Potential Business in Iraq -Canada -European Roundup -Asian Roundup -Latin American Roundup
- SARS and World Trade -Airlines -China Delays Implementation of New Standards -India Enacts Single VAT Tax -U.S. Firms Fined for Sanctions Violations -Poland Buys U.S. F-16’s -Ports Quiz
Symbol· Export Events, Seminars & Conferences
#ff00005 LEAD ARTICLE – Wisconsin International Trade Week May 12-16 The week of May 12-16 features major gatherings of Wisconsin’s International Trade Community. May 13 is the 39th Annual Wisconsin International Trade Conference from noon to 4:15 p.m. at Milwaukee’s Italian Community Center. The event is co-sponsored by 19 major Wisconsin international trade organizations and is Wisconsin’s oldest and largest annual gathering of the international trade community. Go to: http://www.mwta.com/ for registration information and details. The Directors of Wisconsin’s international trade offices in Canada, Mexico, Brazil and Europe will be in Wisconsin for international trade week. Ms. Kara Smith, our new director for Europe will be introduced to Wisconsin companies. The four directors and our Senior Trade Advisor from Japan will broadcast two videoconferences discussing the status of their respective markets to multiple locations statewide. The first broadcast will be from Fox Valley Technical College in Appleton from 1:00-4:00 p.m. on May 14 and will also be available at remote sites in Wausau, Eau Claire and Platteville. The May 15 broadcast Center from 7:45-10:45 a.m. will originate from UW Madison’s Pyle Center and can be viewed at remote sites in La Crosse, Whitewater and Mauston. For more information, go to: http://www.commerce.state.wi.us/mt/MT-PR03-0058.html. Our Directors will also make presentations on international opportunities for medical devices and equipment at GE Medical System’s Educational Center in Waukesha on the afternoon of Monday, May 12 from 1:00 to 4:30 p.m. Information on Wisconsin’s new medical device cluster is available at http://www.commerce.state.wi.us/com-business.html Wisconsin’s Directors will also discuss international credit conditions in their respective markets during the afternoon session of the International Credit Executives meeting on May 15 at Madison’s Concourse Hotel. Further details are available at http://www.icewi.org/event.htm. On May 16, the Directors will lead an International Round-Table and Briefing Session for Wisconsin biotechnology companies at Promega’s Biotechnology Center in Madison from 7:30 a.m. to 10:00 a.m. Contact Christine Stamm at cstamm@commerce.state.wi.us or at (608) 264-7824 to register. #ff00005 Export Markets
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Potential Business in Iraq The Commerce Department has activated a new website with information on business opportunities related to Iraq. At this point, many of these involve sub-contracting opportunities to larger firms that have been awarded government contracts by such agencies as USAID and the Army Corps of Engineers. It would appear that there should be good opportunities for medical equipment, water, sanitation, electricity, food processing, irrigation equipment and educational equipment to name a few. The website, which is updated on a daily basis. As of this writing, United Nations and the U.S. Government sanctions against Iraq remain in place. Changes will be coming, and we suggest you check the Treasury Department's Office of Foreign Asset Control (OFAC) website at http://www.ustreas.gov/ofac/ for late breaking news. As far as credit terms, you might think of Iraq as being in Chapter 11 with the U.S. as the de facto management. Contracts let by the U.S. Government and its principal contractors should be treated as essentially as domestic contracts. Iraq’s total foreign debt is not presently known, but, at a minimum, is $140 billion. In order to meet its existing liabilities, Iraq can hopefully expect to earn about $25 billion from annual oil sales. In short, there is a gap between what Iraq needs to recover and what Iraq can pay. Unless there is a significant contribution by others to the reconstruction of Iraq, reconstruction will either not happen or happen at US expense. Expect a very early effort to reschedule some or all of Iraq’s debts. Within the Middle East, both Jordan and Syria will presumably see negative economic growth this year because of the war. The U.S. is eliminating its military presence in Saudi Arabia and reducing its military presence in Turkey, in part because of anti-American sentiment engendered by the war. Saudi Arabia is also implementing a new long-term policy to reduce the number of foreigners within the Kingdom with the intent of reducing reduce the number of foreign workers in the Kingdom by 3 million by 2013. As a first step, Crown Prince Abdullah of Saudi Arabia has ordered the replacement of 200,000 expatriate jobs in the Kingdom, phased over the next three years. The new policy is a reflection of growing Saudi concern about both the negative impacts of the large number of expatriates working in the Kingdom and a rise in unemployed Saudis.
#ff00004 #ff00004 Asian RoundupChina: SARS is the big news in China and not enough is known to predict the extent of the fallout. The impact of business decisions not made by executives awaiting a clearer understanding of the situation will slow China’s exceptionally high rate of economic growth. Tourist and business travel to China has plummeted. Last year, Beijing alone had 3.1 international visitors which accounted for $3.4 billion in income.Since 1990, Chinese exports have grown about 15% a year and China is now the world’s fifth largest exporter. In 2002, China attracted more than $50 billion in foreign investment about half, of all investment flow to developing countries. Between 2000 and 2002 U.S. exports to China grew by more than $6 billion, while exports elsewhere fell sharply. Japan: The economic prognosis for 2003 is continued stagnation. The Japanese stock market hit a 20-year low in April and the decrease in valuation will have a strong negative effect on banks, insurers and major corporations. Land prices continue their 12-year decline and fell at an average rate of 6.4% - the most since 1992. Commercial land in Japan has lost about two-thirds of its value since 1992. Japan is experiencing its fourth consecutive year of deflation. #ff0000 Korea: Korea’s 6.3% growth in 2002 was the highest growth rate of any major economy with the exception of China. Estimates of economic growth this year have been lowered to about 4% as opposed to about 5.3-6.0% at the end of 2002. Even with this cutback, Korea will have one of the highest growth rates of all major markets around the globe. There are two major factors that could have an important impact on Korea’s economy. The first is the level of global tension about North Korea’s nuclear program and the second is the concern raised by the accounting scandal at SK Global, South Korea’s third largest company. Kookmin Bank, Korea’s largest lender, which has 448.7 billion won ($368 million) in loans to SK Global, has been hit hard by the scandal. Singapore: The U.S. – Singapore Free Trade Agreement will be signed in Washington on May 6. The agreement is exceptionally comprehensive with respect to free trade in services. For a summary of the agreement go to: http://www.ustr.gov/new/fta/singapore.htm. #ff00004 Latin American Roundup
#ff00005 Export News #ff00004 Wisconsin’s New European Trade Offices Effective July 1, 2003, Taskforce Europe Services BV will serve as Wisconsin's trade representative in Europe. Taskforce Europe is headquartered in The Hague, the Netherlands and has offices in the United Kingdom, Germany, France, Norway, Spain, Italy, and Switzerland. The firm is part of the York Group, an international business development firm with 27 offices in 20 countries around the world. The primary contact for Wisconsin firms is founding partner Ms. Kara Hordlow Smith. The senior staff of Taskforce Europe have an average of 15 years experience in direct commercial sales and export consulting. Many of Taskforce Europe's clients have been small companies that are export-ready, but with little international experience. Some of its larger, more well known clients include Airbus Industries, Compaq, Honeywell International, Lucent Technologies, and Mapquest. Taskforce Europe also represents the State of Oklahoma.
#ff00004 #ff00004 China Delays Implementation of New Standards China's May 1, 2003 deadline for full enforcement of the new CCC Standards Mark has been extended to August 1, 2003. For additional information, visit the U.S. Commerce Department's China Desk website at http://www.mac.doc.gov/China/Docs/BusinessGuides/CCCEnforcementDelay.htm. #ff00004 India Enacts Single Value Added Sales Tax All Indian states have agreed to a common value-added-tax (VAT) of 12.5%. This took effect on April 1. The tax was originally slated to be in place on April 1, 2002. The positive impact of the new tax will be to standardize VAT and sales tax within India and end inter-state competition. #ff00004 U.S. Firms Fined for Sanctions Violations On April 4 and April 11 the Treasury Department’s Office of Foreign Assets Control announced that it had fined 59 companies a total of $1.1 million for sanctions violations. Those fined included Amazon, Bank of New York, Caterpillar, ChevronTexaco, Citibank, ExxonMobil, the New York Yankees, Playboy Enterprises and Walmart. Announcements are now being posted on the OFAC website. OFAC’s decision to post the material was apparently made after Ralph Nader’s Public Citizen advocacy group sued the Treasury Department under the Freedom of Information Act for release of the information. #ff00004 Poland Buys U.S. F-16’s On April 16 Poland signed a $3.5 billion contract to buy 48 F-16 fighter aircraft. The sale, which also includes training, munitions, and spares also reportedly involves a compensatory investment program and loans for Poland worth $12 billion. This is the largest defense contract signed by a former Soviet Bloc country since the end of the cold war. The deal is also significant in that Poland is entering the EU and both the French and a British-Swedish consortium were bidding.#ff00004 Ports Quiz We bet that no one in your office can correctly identify the top ports around the world for exports to the U.S. and the top ports for the arrival of imports into the U.S. We certainly couldn’t. Here they are:Top Foreign Ports - Exports to the U.S. U.S. Ports for Imports
41 . Hong Kong 1. New York2. Shanghai, China 2. Los Angeles 3. Singapore 3. Long Beach 4. Kaohsiung, China 4. Charleston 5. Rotterdam, the Netherlands 5. Seattle
7. Bremerhaven, Germany 7. Houston 8. Tokyo, Japan 8. Oakland 9. Genoa, Italy 9. Savanna 10. Yantian, China 10. Miami 4
#ff00005 Other Export Events
Showcase USA 2003 - June 3-5, 2003 - Montreal, Toronto, and
Hamilton
Canadian Manufacturers Technology Show, October 20-23, 2003 -
Toronto, Ontario
GLOBE 2004 8th Biennial Conference & Trade Fair on Developing
the Business of the Environment, March 31 - April 2, 2004 - Vancouver,
BC, Canada 3. For further information contact Christine Stamm, ph: (608) 264-7824.For a list of 2003 events sponsored by the Department of Agriculture, Trade and Consumer Protection go to: http://datcp.state.wi.us/mktg/business/marketing/international/services/pdf/calendar.pdf. To request a list of major international events in Wisconsin click here to e-mail the Wisconsin World Trade Center.
#ff00005Other Export Seminars & Conferences
#ff00005 Contact the International DivisionComments about this newsletter #0000ff: ljanowski@commerce.state.wi.us#0000ff Contact our outreach consultants:
Northwestern Wisconsin - John Konkel #0000ff jkonkel@cvtc.edu
Southwestern Wisconsin - Lou Janowski #0000ff ljanowski@commerce.state.wi.us
Northeastern Wisconsin - Brad Schneider #0000ff bschneider@commerce.state.wi.us
Southeastern Wisconsin - Sue Dragotta #0000ff sdragotta@commerce.state.wi.usContact our area specialists: #ff0000 http://www.commerce.state.wi.us/IE/IE-ContactingAreaSpecialists.htmlContact our offices around the world: #0000ff http://www.commerce.state.wi.us/IE/IE-WisconsinOverseasNetwork.html
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