Canadian and American companies clearly want to do more business together

Despite continued geopolitical risks to global trade seemingly at every turn, Canadian export performance has grown at a rate higher than expected – 8 per cent this year over the projected 6 per cent, according to Export Development Canada’s (EDC) latest semi-annual Global Export Forecast released today.

In particular, stronger demand from US companies and consumers for Canadian products and services is playing a big part in that increase, just as NAFTA negotiations reach a critical juncture.

The energy sector’s return to growth is the main reason that Canada’s exports are picking up, as the oil patch rebounds from devastating forest fires and an ongoing lower price environment. The major buyer of that energy? You guessed it: the US. As the US economy perks up and industry begins to churn, energy demands have followed suit.

At the same time, ores and metals will see a big jump as the US and global industrial sectors begin to slowly increase production. That resurgence in production is also driving up Canadian exports of Canadian machinery and equipment in the strengthening U.S. market.

Canada’s export engine is revved up and firing on all cylinders,” says Peter Hall, EDC Vice President and Chief Economist. “Despite the political signals coming out of the U.S., Canadian and US companies are clear: they want to do more business together. We are seeing more Canadian companies making new business investments in the US and we’re already measuring its impact on boosting demand for Canadian exports, specifically machinery and equipment.”

Highlights: 

Sectors posting double-digit growth include:

  • Energy 31%
  • Ores & Metals 14%
  • Industrial Machinery & Equipment 11%
  • Energy exports stand at $77 billion and are forecast to grow by an astounding 31 per cent in 2017. However, the intense growth will be short-lived as gains flat line in 2018.
  • Services, a key driver in the Canadian export story, will post a positive gain of almost 6 per cent this year and maintain that level of momentum in the longer-term outlook.
  • The forestry sector remains in positive territory with gains of 4 per cent, but growth will slow due to the ongoing softwood lumber dispute between Canada and the US.

Overall, Canadian export growth is expected to level out to 4 per cent in 2018 after its 8 per cent gain this year, pushing export growth above the pre-recession high water mark. “We might very well have finally put our feet on the bottom of this long export stagnancy period,” added Hall.

Globally, EDC is projecting world growth to rise from 3.6 per cent this year to 3.8 per cent in 2018, fuelled by robust growth in emerging markets, specifically ChinaIndia and Brazil. However, developed markets have turned a corner with major economies recording stronger performances this year.

Developed markets are also providing growth opportunities in the long-term, particularly in the EU as a result of the new Canada-EU Comprehensive Economic and Trade Agreement (CETA). The free trade agreement opens up a market of approximately 500 million people worth $20 trillion to Canadian exporters.

“It’s been a long time coming, but global growth is back,” Hall adds. “Canada’s exporters are poised to gain from this growth throughout 2017 and 2018.”

For the full report, visit EDC’s Global Export Forecast: Fall 2017

EDC helps Canadian companies go, grow, and succeed in their international business. As a financial Crown corporation, EDC provides financing, insurance, bonding, trade knowledge, and matchmaking connections to help Canadian companies sell and invest abroad. EDC can also provide financial solutions to foreign buyers to facilitate and grow purchases from Canadian companies.

For more information about how we can help your company, call us at 1-888-434-8508 or visit www.edc.ca.

SOURCE Export Development Canada

‘Murder insurance’ or protection in self defence cases?

By Lisa Marie Pane

THE ASSOCIATED PRESS

ATLANTA _ The National Rifle Association is offering insurancfor people who shoot someone, stirring criticism from gun-control advocates who say it could foster more violence and give gun owners a false sense of security to shoot first and ask questions later.

Some are calling it “murder insurance,” and say that rather than promoting personal responsibility and protection, it encourages gun owners to take action and not worry about the consequences. And, they say, it’s being marketed in a way that feeds on the nation’s racial divisions.

Guns Down, a gun-control group formed last year, is running an ad campaign to criticize the NRA’s new insurance. It’s just the latest group to take aim at the NRA’s offering.

“The reason I call it murder insurance is because if you look at the way this is marketed, it’s really sold in the context of ‘There’s a threat around every corner, dear mostly-white NRA member,’ and that threat is either a black man or a brown man or some other kind of person of colour,” said Guns Down director Igor Volsky.

“So when you inevitably have to use your gun to defend yourself from this threat around every corner, you have insurance to protect you.”

Carry Guard insurance was launched this past spring by the NRA. Rates range from $13.95 a month for up to $250,000 in civil protection and $50,000 in criminal defence to a “gold plus” policy that costs $49.95 a month and provides up to $1.5 million in civil protection and $250,000 in criminal defence.

The NRA isn’t the only gun lobbying group offering such insurance. The United States Concealed Carry Association has been in the business much longer and provides up to $2 million in civil costs and $250,000 for criminal defence. But the NRA is the most prominent gun-rights group in the country and it offered similar insurance previously. And Carry Guard is more comprehensive and being marketed more aggressively than it has been previously. It’s drawing attention to a type of policy that was relatively obscure until now.

Guns Down’s advertising campaign casts a spotlight on the policies and asks the two insurance companies involved with it Lockton Affinity, which administers it, and Chubb, the underwriter to drop it. The campaign includes a video message from Sybrina Fulton, mother of Trayvon Martin, an unarmed teen shot and killed in 2012 by a neighbourhood watch volunteer George Zimmerman whose case drew nationwide notoriety.

The video featuring Fulton begins with images showing some of the most racially divisive moments in recent history _ from the white supremacists who protested in Charlottesville, Virginia, to surveillance footage showing Dylann Roof, who shot and killed nine African-Americans in 2015 during a prayer meeting at a Charleston, South Carolina, church.

“They spend millions lobbying for laws that allow them to ‘shoot first’ and ‘stand their ground.’ But that just makes it easier to get away with murder,” Fulton says. She criticizes the insurance and implores viewers to tell Chubb and Lockton Affinity to drop the insurance and to not purchase their products until they do.

Lockton declined to comment to The Associated Press. In a statement, Chubb told the AP that it provides insurance for a wide range of risks and when customers are engaged in “lawful activity,” including hunting, shooting at gun ranges or when a firearm accidentally discharges. It noted that Carry Guard includes training and safety courses.

Neither Chubb nor Lockton would provide data on the number of policies sold or the claims filed.

Carry Guard was aggressively promoted during this year’s NRA annual meeting, with life-sized posters featuring spokeswoman Dana Loesch holding a card that offers three tips for what to do after shooting someone: Call 911, wait for police to arrive and then call the Carry Guard number for legal assistance. It advises gun owners to not speak with police about the incident until speaking first with an attorney.

The NRA insurance doesn’t require policyholders to take any safety or tactical training courses but encourages them to do so. Initial training courses cost $850 per student for a three-day session.

Peter Kochenburger, an insurance expert at the University of Connecticut School of Law, has been following the emergence of gun insurance. There’s no way to track the number of policies sold or the number of claims filed, though he suspects the latter is fairly small.

Such insurance might benefit society, he said, because it could compel the industry to research ways to make gun ownership and storage safer or by providing discounts to gun owners who take safety courses.

But it could also lead to a “moral hazard” of unintentionally emboldening a gun owner to shoot someone by offering a false sense of security. And the potential backlash against the insurance companies involved might not be worth the revenue such a niche policy could generate, he said.

“Is the potential public relations mess worth the small amount,” Kochenburger said. “‘Murder insurance’: That’s terrible p.r.”

What investors should look for to spot fraudsters before it’s too late

By David Paddon

THE CANADIAN PRESS

TORONTO _ When former financial planner Daniel P. Reeve was convicted this month of defrauding 41 investors out of about $10 million, it was a bitter lesson.

As with many financial frauds, the victims didn’t see it coming, and there’s little to no chance they will recover their money.

At the outset, Reeve sold legitimate products such as mutual funds and insurance. However, unbeknownst to clients, in 2007 he lost his insurance license and by 2008 he was no longer presenting himself as a financial planner, although people at his offices did have official designations.

Impressed by past performance, clients stuck by him.

In the meantime, Reeve begain directing investors to other investments, such as restaurants and hotels that he was developing, often promising little or no risk, despite the shakiness of his failing ventures.

“Yet, Daniel (Reeve) continued to flog his investments in the summer and fall of 2008 either knowing that the investors would never get their money, or not caring whether they would,” Justice Toni Skarica wrote in an Oct. 13 ruling.

Reeve pleaded not guilty to the charges of fraud and theft against him, but the judge did not believe his testimony and convicted him.

“This had a devastating impact on the victims,” says Crown prosecutor Fraser McCracken, who presented the case against Reeve through a trial in Kitchener, Ont., that spanned 18 months.

“That’s why we remind people to take steps to avoid fraud in the first place,” says Tyler Fleming, director of the Ontario Securities Commission’s Investor Office.

Fraud which depends on deceiving the victim comes in many forms and can be difficult to detect.

“The unfortunate reality is that the bad guys are always thinking up new ways to separate you and your money,” Fleming says.

But he says there are several warning signs that should raise red flags for investors:

_ Promises of big returns for little or no risk. (Generally low-risk investments have low potential returns.)

_ Advice based on “hot tips” and “insider
information.”(They’re usually false and potentially against the law
to act upon.)

_ Pressure to buy or decide quickly. (Haste is usually not in the investor’s best interest.)

_ Lack of registration with a provincial securities commission or other financial service regulator.

McCracken says the victims represented a cross-section of people with varying levels of education, investor sophistication and occupation.

Among the dozens of people who trusted Reeve’s record as a money-maker were:

_ A retired teacher who attended one of his investment presentations in early 2007. She and her husband wanted safe investments but lost at least $250,000.

_ The owner of an international trucking firm, who had been advised by Reeve since 1993 with good results until things began to unravel. He lost $683,000 in principal plus unpaid interest.

_ A nurse who asked in 2007 for safe investments, shortly before her husband died of pancreatic cancer. She lost $775,000.

Andrew Kriegler, CEO of the Investment Industry Regulatory Organization of Canada, stresses investors should always ask advisors who they are regulated by , and what their disciplinary history is.

He acknowledges that it’s not always clear where to look, but insists it’s always worth the time and effort..

“If it’s under our jurisdiction, then we can look into it. If it’s under somebody else’s jurisdiction, we will send that person to the right place,” Kriegler says.

IIROC operates two call centres in Toronto and Vancouver that take questions from the public.

The provincial commissions have a national registration search
for individual advisers and investment firms at
CheckBeforeYouInvest.ca

New Brunswick to impose new measures for drunk drivers starting November 1

FREDERICTON _ New Brunswick will seize drunk drivers’ cars for up to two months under a law that comes into force Nov. 1

Public Safety Minister Denis Landry says the new law will make the province one of the country’s toughest on impaired driving.

Anyone convicted of drunk driving will have their vehicle impounded for up to two months and have a mandatory ignition interlock device installed in their vehicle when they get their licence back.

The mechanism is similar to a breathalyzer and won’t allow a vehicle to start if the driver is over the limit for alcohol.

The changes also include longer suspensions for drivers with a blood alcohol level within the warning range of 0.05 and 0.08, and those suspensions will remain on their driving record.

Police officers will also have the discretion to suspend a driver for 24 hours if they have any concerns about his or her safety.

Danielle Cole of MADD Canada says the changes are welcome news that will help reduce the number of impaired drivers.

Cole, who survived a crash with a drunk driver in 2012, says impounding vehicles is a great move.

“Looking back at B.C. they imposed impoundment in 2010 and it reduced impaired driving crashes by 50 per cent. The same was done in Alberta and it reduced crashes by 43 per cent,” she said.

Erin Norwood of the Insurance Bureau of Canada says the changes send a strong message.

“If you drink and drive, you will face severe penalties. Your car may be seized, you may be arrested, charged and sent to jail. On top of that your insurance premiums may increase dramatically,” she said.

Norwood says that according to Statistics Canada, New Brunswick is one of only two provinces where the number of impaired drivers under the age of 20 has actually decreased in the last six years.

Chris O’Connell, New Brunswick’s registrar of motor vehicles, says about 1,000 people are convicted of alcohol-impaired driving in the province each year. He says that will mean about 1,000 ignition interlock devices will have to be put into use.

The cost of the interlock devices about $95 per month  will have to be paid by the drivers using them.

Landry also says he’s confident the province and police will be ready to deal with drivers who may be under the influence of marijuana.

The federal government plans to make recreational cannabis legal by July of next year, and Landry says there’s a lot of discussion underway across the country to ensure police have the regulations and equipment they need.

 

If NAFTA dies, old Canada U.S. FTA would live on, right? Not so fast, Canada

By Alexander Panetta

THE CANADIAN PRESS

WASHINGTON _ It’s a refrain frequently heard in Canada: That ending NAFTA wouldn’t change much in economic relations with the United States, because the countries could simply pull their older agreement off the shelf, dust it off, and persist in trade without tariffs.

It’s also wrong, some analysts say.

A few people interviewed this week disputed the idea that the original Canada-U.S. Free Trade Agreement of 1987 would automatically snap back into place if NAFTA disappears, an increasingly relevant topic as hostilities mount in the trilateral trade talks.

“That’s so naive,” said Sarah Goldfeder, a former U.S. diplomat in Mexico and Canada who is following the trade negotiations at Earnscliffe Strategy Group in Ottawa, on the idea of an automatic snap-back.

“You’d have to re-implement (the original agreement).”

That would raise new challenges, she said. First of all, she said the current American political climate would not make for an easy re-implementation. She said there would be demands for a renegotiation within the U.S., and the parties would soon be back at the table struggling with many of the same sticking points.

“There’s no way this (Trump) administration would do this (re-implementation) without negotiating a new agreement,” she said.

“So you’re still going to have to negotiate all the same irritants.”

The current talks have become bogged down amid huge gaps between the countries and not only in material things like dairy, automobiles, and public works’ Buy American rules, but in basic philosophical differences on the architecture of a trade deal.

The Trump administration’s proposals would make it easy to cancel the agreement within five years, and hard for countries to count on stable long-term access to each other’s markets.

The president says he’ll cancel NAFTA if he can’t get a deal.

Insiders now view termination as a real possibility, raising unprecedented procedural questions _ like what the rules are for cancelling a trade deal and, of particular importance to Canadians, what the rules are for reviving an old one.

The suspension of the old agreement was signalled in diplomatic notes exchanged between the countries. The 1993 notes were brief and vaguely worded. The countries complimented each other on their new deal with Mexico, and confirmed that each would make separate arrangements to suspend the old deal.

The American suspension is laid out in Section 107 of the law implementing NAFTA in that country in 1994. The earlier deal negotiated by Brian Mulroney and Ronald Reagan was to be suspended, and, according to the law, it would remain suspended until such time as that suspension might be “terminated.”

It doesn’t define how you “terminate” a suspension. But a trade consultant who two decades ago advised Canada’s parliamentary committee on NAFTA implementation said it obviously requires someone to do something.

“It’s been suspended. Somebody has to un-suspend it,” Peter Clark said.

That someone could be Congress. And even if Congress does successfully vote to re-introduce the old FTA, its vote would either require the approval of President Donald Trump, or an overwhelming, two-thirds majority vote in Congress to overcome a presidential veto.

A Washington trade expert says lawmakers could also try sneaking bits of trade legislation into larger bills it’s a common practice in American lawmaking to tack on unrelated items to a bill.

But Eric Miller says his own congressional sources have already told him: American lawmakers would expect a vote on any FTA re-implementation. He’s warning Canadians now _ over what he calls a dangerous complacency that there’s some insurance policy if NAFTA dies.

“I think it’s highly questionable that this insurance policy will pay out, and pay out in full, in the case of an accident,” he said.

“I’m highly doubtful the agreement would come back into place and everyone would be fine with it… If Congress believes they’re going to have to vote on it, then they’re going to have to vote on it.”

The U.S. Constitution, after all, gives Congress the power over international commercial agreements. Historically, Congress has merely lent that power to the president, and worked out a compromise set of rules known as fast-track legislation.

Now some analysts suggest the Congress could try wresting back its rightful power, block any Trump effort to cancel NAFTA, and avoid all this uncertainty over the 1993 deal, the 1987 deal, and trade in general.

But a former U.S. trade czar expresses some doubt this will happen.

Barack Obama’s trade representative Michael Froman points to the track record of this current Congress which has failed to pass a single piece of policy legislation of any significance.

“I think it would require a lot of action, a lot of consensus in Congress. And that may emerge,” Froman told the Council on Foreign Relations this week.

“But so far, there haven’t been a lot of profiles in courage.”

The end of free trade in North America would leave new tariffs averaging 3.5 per cent in the U.S., 4.2 in Canada, and 7.1 in Mexico. Some analysts say that would reduce Canada’s GDP by about 2.5 per cent on a long-term basis.

Lisa Okill managed Sears Canada locations in Ontario for more than 2 decades

Read more

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