Economic Digest – October 2015

TRADE

Canada has struck a free-trade deal with the Ukraine, an accord that represents more of a gesture of solidarity than a commercial breakthrough. Canada will drop nearly all of its tariffs on Ukrainian imports while Kiev will remove duties on 86 per cent of Canadian imports, including those on industrial goods, forestry and wood products, fish and seafood products as well as most farm goods. Canadian pork producers will still face trade barriers but other sectors will get unhindered access to Ukraine’s market, including those producing beef, grains, canola oil, processed foods and animal feed.

TECHNOLOGY

The technology allowing consumers to make purchases using debit and credit cards stored on their smartphones is rolling out across Canada, but fewer than 25 per cent of consumers are using it.  Mobile payments where consumers make small purchases by holding their phones near compatible point-of-sale merchant terminals, have become a key area of development among financial institutions eager to satisfy what they believe is strong consumer demand.  They also want to position themselves as technologically forward as well as protecting themselves against the possibility that large companies like Apple and Google will position themselves as alternative financial players.

TREES

A new paper by a team of researchers presents a compelling case for why urban neighbourhoods filled with trees are better for your physical health.  The large study builds on a body of prior research showing the cognitive and psychological benefits of natural scenery, but also goes further in actually beginning to quantify just how much an addition of trees in a neighbourhood enhances health outcomes.

CHIPS

IBM has said it has overcome technical hurdles threatening to delay the manufacture of silicon chips with the smallest components so far. It can now make chips 7nm (nanometres) wide, 1,000 time smaller than a red blood cell. The smallest parts on current chips are about 14nm. One nanometre is equal to one billionth of a metre. Chip-makers are currently updating fabrication systems to produce processers with components 10nm wide, which will mean that computers will become more powerful.

DRINKS

Cineplex is shrinking soft drink sizes at its theatres across Canada and while the hulking large cup will disappear, moviegoers will be paying the large price for a drink that is 12 ounces smaller. A large drink will be the size of the former regular drink, 32 ounces down from 44 ounces. A regular drink will be reduced to 24 ounces versus 32 ounces previously. A small drink is unchanged at 16 ounces. Cineplex has been testing the revised drink sizes in British Colombia and Saskatchewan since 2013. 

DIET

A new study from UBC shows that men aged 65 and older are less likely than women to eat at least five servings of fruit and vegetables each day. Nearly two-thirds of senior men in Canada don’t meet the five-serving threshold, even when they have social and emotional support, access to nutrition advice or have their meals prepared by a caregiver or loved one. Canada’s Food Guide recommends a minimum of five servings of fruit and vegetables a day for people of all ages, a diet that is associated with reduced risk of stroke, cancer, depression and dementia.

RENOS

Canadians are spending more on fixing homes than buying new ones as renovations top C$68-billion, $20-billion more than was spent on new homes last year. Spending on renovations is now such an important part of the overall Canadian economy that it accounted for 3.4 per cent of gross domestic product in 2014 and is expected to grow by three per cent annually in 2015 and 2016. Most of the spending, three out of four dollars, is going towards alterations or improvements.

EQUIPMENT

Operating revenue for the automotive equipment rental and leasing services industry group totalled C$5.9-billion in 2013, while operating expenses were $5.1-billion, resulting in an operating profit of 14.4 per cent. Sales to the business sector accounted for 48.3 per cent of this industry groups’ total sales in 2013, followed by individuals and households at 44.2 per cent. Sales to governments and clients outside Canada accounted for the other 7.5 per cent.

BOARS

A researcher is claiming that wild boars are a menace in British Colombia. They were introduced to western Canadian provinces in the late 1980s and early 1990s by the Ministry of Agriculture as part of an initiative to broaden livestock and have since become an invasive species. Female boars are extremely fertile producing 2-3 times per year with an average of 6 piglets per litter. It is claimed that wild boar populations are spreading disease, destroying vegetation in BC  and no one knows how many there are. Since 2014, BC has allowed boars to be hunted anywhere, anytime by anyone with a valid hunting license.

SEABIRDS

Populations of seabirds have dropped by a staggering 70 per cent since the 1950s. Researchers say that seabirds are a particularly good indicator of the health of marine ecosystems. Information has been compiled on more than 500 seabird populations around the world. This represents 19 per cent of the global seabird population. Overall populations have declined by 69.6 per cent, which is equivalent to the loss of about 230-million seabirds in 60 years.  The cause is due to a variety of factors, including overfishing of the fish seabirds rely on for food. In addition, birds become tangled in fishing gear and are killed by oil and pollution. Also, non-native predators and habitat loss have taken their toll.

PASSPORTS

Selling passports is a boon to small island mini-states like Antigua, Dominica, Grenada and St. Kitts & Nevis. Clients do well too: their documents give them visa-free entry to many countries, including Britain and 26 European nations. In St Kitts, the countries income topped US$100-million in 2013, over 13 per cent of GDP, one third of state revenue, and this year, Antigua says its takings will be one quarter of state revenue. Apart from money, the states do not ask much for those requesting passports.

COMPENSATION

Rail passengers in the UK who suffer travel delays can now claim refunds in cash instead of vouchers, a system that has been in place for about 20 years. The changes have been made after consumer groups criticised the vouchers saying they could not be used online or to access cheap fares. Passengers will be entitled to refunds if their train is delayed by at least 30 minutes. Claims must be submitted within 28 days of the delay.

WEATHER

Based on contributions from 413 scientists from 58 countries around the world, 2014 was the warmest year since records were compiled in 1901. Climate change markers such as rising land and ocean temperatures sea levels and greenhouse gases set new records in 2014. South Asia temperatures were up as were those for India and 20 European countries exceeded their previous records. The global average sea surface temperature was the highest on record in 2014 and so was the global sea level rise.

BARCELONA

This Catalonian city now hosts five times as many visitors as 20 years ago and there is a feeling among some locals that the financial benefits are not worth the hassle. As many as nine million visitors are expected in Barcelona this year, crammed into a few small areas of a city of 1.6-million inhabitants. With the weak Euro attracting ever more tourists and as many as 2.5-million visitors disembarking from cruise ships each year, residents are feeling besieged. However, the tourist industry accounts for 15 per cent of Barcelona‘s GDP and about 120,000 jobs. One of the most popular districts has lost 13,000 residents in eight years, driven out by high rents and the relentless noise of tourism.

POTATOES

349,005 acres (141,238 hectares) of potatoes were planted in Canada in 2015, up 0.4 per cent from 2014, the lowest level in 20 years. Despite this slight increase, total planted area remains significantly lower compared with the 2003 peak of 457,500 acres (185,144 hectares). Prince Edward Island represents 25 per cent of total potato area, and Manitoba 19 per cent in 2015.

SPAM

According to the security firm Symantec, people are being sent fewer e-mails than at any time in the past 12 years. The fall suggests that cyber-thieves are looking to other ways to make money from people going online. Legal action against the criminal networks that pipe spam to people have also helped to cut junk mail. However, the fall in spam has been offset by a rise in the amount of malware being circulated which is designed to steal information or spy on computer users.

DEBT

The Canadian federal agency has written off at least C$4-billion in debts in the past two years, including accounts worth more than $10-million. Debts were declared uncollectible because those owing had died, gone bankrupt, could not be located or lived outside Canada. In other cases, officials considered it not worth the expense to track down the money owing.

LABELS

A new study has found that some herbal food supplements do not contain what they claim on the label. The BBC teamed up with experts from University College London to test a selection of products bought from stores and online. Of 30 ginkgo products tested, eight contained little or no ginkgo extract. In one case of milk thistle, unidentified substances were present in place of milk thistle. High prices were no guarantee of quality. The UCL team tested 90 products using two methods, nuclear magnetic resonance spectroscopy and high performance thin layer chromatography to study their composition.

UNESCO

The industry behind champagne production has been handed world heritage status by the United Nations cultural arm. Unesco decided that the vineyards, wine cellars and sales houses where champagne is produced were culturally significant. The status should ensure that the sites receive special protection in the future. Unesco said the champagne was a very specialised artisan activity that has become an agro-industrial enterprise. The vineyards of Burgundy in France have also been given World Heritage status.  Among other sites named recently were: Singapore’s Botanic Gardens, Diyarbakir Fortress in Turkey and Maymand cave dwellings in Iran.

THE ARK

Opening next year at a cost of US$48-million and called the ARK at JFK, it is a new luxury terminal for animals at New York’s Kennedy International Airport. It will handle more than 70,000 animals flying in and out of the airport every year, from cats and dogs to horses, cows and even sloths and aardvarks. It will include an aviary and employ 110 vets.  Animals will be transported in dedicated climate controlled vehicles to ensure their safety and happiness. Shipments of horses, birds and other creatures through the area have risen by 28 per cent in the past three years.

RENTALS

Vancouver, among other cities is keeping its eye on Airbnb as the company snaps up rental properties which target tourists, leaving fewer homes on the market for local residents.  Cities from Santa Monica to Paris are trying to curb the impact of Airbnb on housing affordability. Airbnb has become the most popular of sites used by homeowners to make money by renting out their entire home, or even a single bedroom. At the end of June the San Francisco based company closed a round of US$1.5-billion in private funding from hedge funds, mutual funds and private investors for a valuation of $25.5-billion, making it worth more than some of the largest hotel chains.

BOXCARS

A shrinking supply of boxcars, once the ubiquitous symbol of US railways and a rolling bellwether for the economy, is causing a freight-hauling crunch. The number of boxcars in service in North America fell by 41 per cent in the past decade to just less than 125,000 last year as 101,600 were scrapped and only about 13,800 replacements were added. That downsizing accelerated a decades-long shift by railways to more specialized railcars and intermodal carriers that allowed shipping containers to hop from trucks to trains. While the transition has worked well for many shippers, paper manufacturers, lumber producers and other companies that rely heavily on boxcars to protect and move heavy shipments are struggling with a boxcar shortage.

REWARD

Two hackers who spotted security holes in the United Airlines website have been rewarded with a million free flight miles, each worth dozens of trips.