In the Precision Software News Round-Up: 5 October 2018, the WTO downgrades global growth, the USMCA changes rules of origin for cars, and we explain how free trade origin works. Plus, XPO is to deploy 5,000 robots, DHL tests medicine delivery by drone, and Londoners and the Welsh love their subscription boxes.
USMCA CHANGES NAFTA RULES OF ORIGIN FOR AUTOMOBILES
The recently agreed NAFTA replacement, the United States-Mexico-Canada Agreement, will include rules of origin changes for cars. As a result, carmakers such as Daimler and Nissan have stated that they will have to reconsider their supply chains. If not, the companies could face higher import tariffs on auto parts sourced outside of North America. Under the new rules, 75 percent of a car's content must be built in North America. This is up from 62.5 percent under NAFTA. Cars that do not meet this requirement will face duties. For more on this story, please see Forbes.
WTO DOWNGRADES GROWTH FORECASTS
The World Trade Organisation (WTO) has cut its growth expectations for global trade for 2018 and 2019. This is as a result of the ongoing US-China trade war. The WTO had projected 4.4 percent growth this year. This has been scaled back to 3.9 percent. Furthermore, the organization predicts growth of 3.7 percent next year. However, even by these projections, trade growth will outperform GDP by a factor of 1.3.
“While trade growth remains strong, this downgrade reflects the heightened tensions that we are seeing between major trading partners. More than ever, it is critical for governments to work through their differences and show restraint,” said WTO director general Roberto Azevêdo. For more on this, please click here.
DHL TESTS MEDICINE DELIVERY DRONE IN EAST AFRICA
DHL has tested medicine delivery by drone to Ukerewe Island in East Africa’s Lake Victoria. This was the first test in DHL’s “Deliver Future” project. An unmanned aerial vehicle — the fixed-wing “DHL Parcelcopter 4.0” — flew 37 miles (almost 60 km) to Ukerewe Island on Lake Victoria, which sits between Uganda, Tanzania and Kenya. Residents of Ukerewe Island suffer from a variety of water-borne illnesses, such as cholera, dysentery and typhoid which are treatable. However, given the remoteness of the island, getting medicine there presents logistical difficulties. Issues include lack of infrastructure and the threat of heat spoiling temperature-sensitive products. This often means that people do not receive the medication they need. Drones, which can take off and land vertically, and offer fast delivery could present a solution. You can read more about this here. To watch the video of the drone flight, please click here.
XPO TO DEPLOY 5,000 WAREHOUSE ROBOTS
XPO Logistics is planning to add 5,000 intelligent robots to its facilities in North America and Europe. The logistics giant has a strategic partnership with robotics manufacturer GreyOrange Pte. Ltd. The collaborative robots — or cobots — work alongside warehouse staff and are part of a modular goods-to-person system. In addition, the robots can move racks weighing up to 3,500 lbs (1,588 kg) and bring them to warehouse staff. You can read more on this story here.
LONDONERS & THE WELSH LOVE THEIR SUBSCRIPTION BOXES
People in London and Wales are driving growth in the UK’s subscription box service. Just over half — 50.7 percent — of Londoners subscribe to at least one box service. The Welsh have the most subscription boxes — an average of 4.3 per person. Recipe boxes are particularly popular in London. There are a number of regional favorites. Residents of East Anglia are most likely to sign up for beauty boxes, while those in the East Midlands favor DVD subscriptions. You can read more on this story here.
The Precision Report
RULES OF ORIGIN: FTA ORIGIN VS COUNTRY OF ORIGIN
Understanding the Rules of Origin for free trade agreements is complex. Preferential and Non-preferential Rules of Origin use different metrics to determine the origin of goods. Because of this, the Country of Origin — ie the place here the last substantial transformation of the good took place — is not the same as origin under free trade agreements. In the latest Precision Report we examine the differences between FTA Origin and Country of Origin. To read the full report, please click here.