World Trade - August 2008 - (Page 18)

COVER STORY States on which Mexico continues to depend as Best Imports 2007-2008 (Jan-Apr) Worst Imports 2007-2008 (Jan-Apr) an outlet for its exports. InflaUS$ US$ tionary presCommodity millions Commodity millions sures, mainly attributable to the increase Crude oil $45,069 Computer accessories -$963 in food and energy prices, should remain under control, thanks to a tightening of Fuel oil $4,887 Lumber -$711 monetary policy. Petroleum products, other $2,793 Stereo equipment, etc -$684 The international financial turmoil should have limited impact on a relatively Liqueﬁed petroleum gases $2,682 Apparel, household goods - cotton -$627 diversified economy with reasonably Other household goods $1,772 Apparel, textiles, nonwool or cotton -$597 solid foundations. Public ﬁnances should Industrial machines, other $1,436 continue to improve, even if they remain Business machines and equipment -$583 dependent on oil revenues, with already Chemicals-fertilizers $1,182 Household appliances -$570 moderate external debt ratios easing furChemicals-organic $995 Shingles, wallboard -$523 ther. Amid a decline in oil production, less dynamic exports to the United States Telecommunications equipment $956 Bauxite and aluminum -$455 and a slowdown of emigrant worker remitIndustrial engines $912 Furniture, household goods, etc. -$406 tances, the external account deficit will widen. Foreign direct investment should Best Exports 2007-2008 (Jan-Apr) Worst Exports 2007-2008 (Jan-Apr) nonetheless cover half of Mexico’s ﬁnancing needs, with short-term debt remaining US$ US$ moderate. Commodity millions Commodity millions Stronger growth—especially desirable in view of demographic growth—would Computer accessories -$1,053 Fuel oil $5,560 nonetheless require increased investment Logs and lumber -$117 Nonmonetary gold $4,099 and modernization of the entire economy. Tobacco, manufactured -$112 Petroleum products, other $2,736 State-run energy companies have performed poorly. The level of skills in the Apparel, household goods - textile -$61 Soybeans $2,734 labor force will have to rise in order to Wood, glass, plastic -$55 Civilian aircraft $2,487 move production up-market. Reforms have come up against stiff social and politFinished textile supplies -$49 Automotive, parts, and engines $2,445 ical resistance, however, with President Tapes, audio and visual -$39 Wheat $2,295 Calderon’s National Action Party (PAN) Vessels, excluding scrap -$32 conservative party lacking a parliamentary Corn $1,757 majority. The adoption of partial pension Textile, sewing machines -$19 Plastic materials $1,409 and tax reforms at the president’s initiaHides and skins -$13 Chemicals-organic $1,409 tive in 2007 was nonetheless an encouraging step forward. In that context, the Coface payment account surplus and the massive inﬂux of capitals end up experience has remained satisfactory. Sectors linked to in the stock market, with the Shanghai stock market index construction, retailing and, to a lesser degree, the car more than doubling in 2007. The very high price earn- industry have been the most dynamic. The few rough ing ratios prevalent in China compared to those in other patches encountered in the dairy industry and textiles Asian stock markets are indicative of an emerging specula- are the result of particular problems or difﬁculties expetive bubble. Volatility risk has thus been very high. rienced in meeting foreign competition. Politically, China remains stable with Hu Jintao re-elected as general secretary of the Chinese Communist Party. How- Japan ever, social tensions and inequalities between urban and A slight rebound in household rural areas represent serious risks. Nonetheless, in the short consumption notwithstanding, term, the government is likely to hold them in check. Gov- economic growth slowed in ernance moreover still presents major deﬁciencies. Recent 2007 as did exports and cormeasures to combat corruption have yet to contribute to a porate investment. The stiffening of anti-seismic standards signiﬁcant improvement in the business climate. severely disrupted the residential construction sector, Mexico delaying delivery of building and works permits. Even with the economy still mainly driven by domesThe economy will weaken further in 2008. The yen tic demand, growth should remain moderate in 2008 appreciation in conjunction with a more pronounced due notably to the economic slowdown in the United North American economic slowdown will continue to LEADERS & LAGGARDS 18 WORLD TRADE AUGUST 2008

Table of Contents Feed for the Digital Edition of World Trade - August 2008

World Trade - August 2008 Contents Weathering the Storm Helping the World’s Poorest Nations Benefit from Global Trade Supply Chain Watch Tradewinds World Trade’s Top U.S. Trading Partners LTL Shipping ‘On the Fly’ Air Cargo Flies a New Heading Getting More from China Sourcing Why 3PLs Need a Seat at the C-TPAT Table Performance-based Supply Chains Drive Total Lifecycle Value SmartWay Navigates Sustainable Transportation Around the World in 80 Days—Hours—Minutes

World Trade - August 2008

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