In the QAD Precision News Round-Up: 8 May 2020, UK-US trade talks
begin; China exports increase 3.8 percent in April; world food
prices decline; DHL adds flights to the Americas; plus the high cost
of financial compliance violations and more.
UK-US TRANSATLANTIC TRADE TALKS BEGIN
On Tuesday, the first round of trade talks between the UK and US
began via video call. The negotiations are set to last for two weeks
and were formally opened by the UK International Trade Secretary Liz
Truss, and the US Trade Representative, Robert Lighthizer.
Negotiations will involve and were
100 officials from the UK’s Department for International Trade (DIT),
and 100 negotiators on the US side. The trade talks with the US are
taking place at a time when there has been very little progress in
negotiations with the EU. For in-depth coverage, please see The Guardian.
CHINA EXPORTS INCREASE 3.8 PERCENT IN APRIL
On Thursday, data from China’s General Administration of Customs
stated that China’s exports rose 3.5 percent from a year ago while
imports declined 14.2 percent in the same period. Reuters polled
economists whose forecasts were significantly different to the figures
released by China. Economists forecast that exports would decrease by
15.7 percent, and that imports would fall 11.2 percent from the
previous year. Furthermore, in April, China’s trade surplus was $45.34
billion — significantly higher than the predicted figure of $6.35
billion. Chief economist for China at Citigroup, Liu Li-gang, said
that China’s medical exports likely increased in April as the country
transported health-care supplies to the rest of the world. For more
details, please see CNBC.
WORLD FOOD PRICES DECLINE IN APRIL DUE TO COVID-19
In April, world food prices fell for a third month due in a row. The
fall is as a result of both the economic and logistical impact of the
coronavirus outbreak, according to the United Nations food agency. The
UN’s Food and Agriculture Organization food price index was down 3.4
percent from March. In addition, the FAO sugar price index fell to a
13-year low, decreasing 14.6 percent from March while the vegetable
oil price index fell 5.2 percent. Further declines include the dairy
index, which was down 3.6 percent, while the meat index fell 2.7
percent. For more information, please see Reuters.
DHL ADDS FLIGHTS TO THE AMERICAS
DHL Express has seen imports from Asia to the America’s grow
significantly as it helps fight coronavirus. Imports from Asia are up
70 percent year-on-year. Giving an indication of the increase, DHL
Express transported approximately 168,000 shipments of medical
supplies to the Americas in just one week. However, air capacity has
been reduced due to the grounding of passenger flights. In response,
DHL has upped its services, adding extra flights and charters meeting
demand for PPE shipments. For more on this news item, please see Post
and Parcel Technology.
UPS CONTINUES BATTLE AGAINST CORONAVIRUS
UPS is working with Edwards Lifesciences to transport medical
equipment used in hospitals in the fight against Covid-19. Edward
Lifesciences provides critical care technologies to treat critically
ill patients, including . Covid-19 patients in intensive care.
Spokesperson and corporate vice president at Edwards Lifesciences,
Katie Szyman, praised UPS, saying that as a result of the
collaboration, the company had been able to ensure that critical
technologies reached healthcare workers fighting the Covid-19
pandemic. For further details, please see Air
AIR CARGO VOLUMES IMPROVE
In the second half of April, air cargo volumes improved following a
rapid decline in March. Nonetheless, volumes in April were down 39
percent year-on-year while, and capacity was 45 percent lower. Despite
this, the past two weeks in April shows that volumes have somewhat
improved. According to Frieghtos’ WebCargo data, air freight rates
remained stable in the past week as capacity increased. For more
details, please see The Loadstar.
QAD Precision News
THE HIGH COST OF FINANCIAL COMPLIANCE VIOLATIONS
On 30 April 2020, a well-known financial services company was issued
with a finding that it had violated sanctions regarding the
proliferation of weapons of mass destruction. The US Treasury
Department’s Office of Foreign Assets Control (OFAC) found that the
company had issued a prepaid card to, and processed financial
transactions totaling $35,246.82 on behalf of a person on the
Specially Designated Nationals (SDN) list. Luckily for the bank, OFAC
also found that the violations were not the result of a wilful
flouting of the law, but rather human error and alongside gaps in the
company’s screening process.
Fine for violations of financial compliance laws can be very steep.
In 2014, an international banking group with a presence in 73
countries made headlines for all the wrong reasons. The bank was the
recipient of the largest ever penalty issued by OFAC. The amount? An
eye watering $8.9 billion for violating sanctions against Cuba, Iran
Banks that work internationally are subject to a host of financial
compliance regulations. In this QAD Precision Report we look at areas
of risk for banks and financial firms as well as strategies to ensure
ongoing financial compliance. To read the full report, please click here.
[JOIN OUR WEBINAR] IS PARCEL SHIPPING COSTING YOUR UNIVERSITY MORE
Please join QAD Precision on Thursday, May 21st at 12 pm EST for 30
minutes for an informative session on university supply chain
logistics. For the last few years we have been touring the largest
universities in the US and examining their shipping and trade
compliance processes. We will discuss our findings at this remote conference.
Who should attend this event?
Procurement leaders who are looking to control and aggregate
their ship spend.
Supply chain and logistics leaders who are looking to control
IT leaders who are looking to relinquish support of multiple
separate shipping and compliance applications
Trade compliance people who want to ensure proper screenings
procedures are followed on all outbound shipments