QAD Precision News Round-Up: 23 July 2021

In the QAD Precision News Round-Up: 23 July 2021, EU refuses to renegotiate NI protocol; sterling hits new low; Euro zone PMI soars; Japan’s exports skyrocket; Nike’s Vietnam plant shuts down; plus compliance issues for high tech firms and more. 

Global Trade

JAPANESE EXPORTS INCREASE

In June, Japan’s exports increased 48.6 percent compared to the previous year. The total exports for the month reached $66 billion. This is Japan’s fourth-straight month of growth according to the Finance Ministry.In addition, Japan’s imports for the month also grew 32.7 percent to $62 billion. 

Japanese exports to the United States grew 86 percent in June from the previous year. Furthermore, exports to China also rose to 28 percent. Primary exports to the two countries include: vehicles, computer parts, and semiconductor equipment. Japan is the third largest economy in the world, reporting a trade surplus of $9 billion in the first half of the year. For more details, please see AP News.

EU REFUSES TO NEGOTIATE NORTHERN IRELAND PROTOCOL

On Wednesday, the EU rejected a request by the UK to rewrite the post-Brexit settlement involving Northern Ireland. The Northern Ireland Protocol was part of the Brexit deal that finalised Britain's exit from the EU. Under the Protocol, goods between the British mainland and Northern Ireland require checks. Businesses in Northern Ireland believe that this is damaging trade. 

In addition, some pro-British groups have protested what they say is a weakening of ties with Britain. However, European Commission Vice President Maroš Šefčovič said it was not possible to redraw the protocol. Mr Šefčovič stated that the UK Prime Minister Boris Johnson and Chief Brexit negotiator David Frost had negotiated the terms of the Northern Ireland Protocol. The UK government signed the agreement in December 2020. For more information, please see Reuters.  

POUND HITS NEW LOW

The British pound has hit a more than five-month low against the dollar and a five-week low against the euro. On Tuesday, it was also reported that sterling was trading 0.5 percent lower than the dollar at $1.3604 and traded flat against the euro at 86.36 pence. The downturn is being partially attributed to England lifting COVID-19 social restrictions on Monday. In addition, a global uptick in infections is also seen as a cause for the investor sell-off in favor of bonds. For more information, please click here.

EURO ZONE BUSINESS ACTIVITY EXPANDS IN JULY

This July, Euro zone business activity expanded at its fastest monthly pace since 2000. COVID-19 restrictions eased across the bloc, boosting services. In July, the IHS Markit's Flash Composite Purchasing Managers' Index (PMI) increased to 60.6 from 59.5 the previous month. This reading is significantly ahead of the 50-mark that separates economic growth from contraction. In addition, it was also higher than a Reuters poll forecast of 60.0. 

Furthermore. a PMI covering the Euro zone's service industry expanded to 60.4 from 58.3. This was its highest reading since June 2006. However, the likelihood of another wave of infections has hit business confidence. The composite future output index fell to 67.8 from 71.9.  For more details, please see Reuters.

Retail 

COVID HALTS NIKE’S VIETNAM PLANTS

Production in some of Nike’s largest plants is being halted due to rising COVID-19 numbers in Vietnam. Vietnam produces around half of all Nike shoes. On Wednesday, one of Nike’s worst affected suppliers, Pou Chen Corp suspended operations at its plant in Ho Chi Minh City for 10 days due to COVID-19. 

Pou Chen Corp, which also manufactures footwear for Adidas, is Ho Chi Minh City’s largest employer, with 56,000 employees. Apple, Samsung and Puma also have large production plants in Vietnam at risk from the shutdown. Nike employs 450,000 workers in Vietnam, 80 percent of whom are women. Vietnam has added factory workers to its vaccine priority list. So far, Vietnam has vaccinated just 4 percent of its 100 million residents. For more information, please see BBC News.

Carriers 

DHL TO OPEN NEW PHARMA WAREHOUSE IN GERMANY

DHL Supply Chain is opening a new logistics center in Florstadt, Germany to service markets across Europe. The new 32,000m2 facility will expand the current capacity of the multi-use campus for pharmaceuticals and medical products at the site to over 70,000m2 in total. The new center will provide customers from the pharmaceutical and medical products sector with temperature-controlled warehouse space in zones covering 15-25°C, 2-8°C and -24°C. Additionally, customers will be able to store hazardous materials in a separate 1,750m2 space. For more information, please see Parcel and Postal Technology.  

QAD Precision News 

THREE TRADE COMPLIANCE ISSUES FOR HIGH TECH MANUFACTURERS

Innovation, at its core, is spreading new ideas to new people. For high tech manufacturers, this means spreading product across audiences, regions and even countries. Unfortunately, the global trade landscape isn’t especially open to the constant movement of goods and ideas. There are many rules and regulations that govern how manufacturers transfer goods across borders.

Adhering to customs and international trade compliance regulations is crucial for high tech manufacturers. There are some very real consequences attached to these seemingly innocuous laws. Monetary fines, penalties and shipping issues (read: delays) are a very real possibility. Furthermore, all of these outcomes put the customer experience at severe risk. In this QAD Precision Report, we look at the three most pressing compliance issues for high tech enterprises. To read the full report, please click here.  

[LIVE WEBINAR] DANGEROUS GOODS & REVISION 7: AN OVERVIEW FOR SHIPPERS

Please join us for a live webinar on Thursday, 29 July 10am EST where industry experts Dr. Luc Séguin of KMK Regulatory Services Inc and Paula Reavis, Dangerous Goods Trainer at Reavis Compliance Company come together with QAD Precision's Olivier Joncas to discuss best practices for shipping dangerous goods as well as the recent regulation changes and the impact for Revision 7 of the GHS. Register here!