There’s also renewed concerns about the state of global shipping and consequential inflationary pressures, as the US East Coast is hit by dockworker industrial actions.
Starmer’s visit to Brussels this week could also herald a new chapter in EU-UK post-Brexit relations and youth mobility is up for debate again.
The big picture: A new threat to supply chain disruption has raised the stakes for increased global inflation, as dockworkers across the US East Coast began industrial action this week (1 October).
Ports from Maine to Texas, servicing approximately half of all goods shipped through the US, will be out of action until a new US$5 per hour pay increase is agreed, according to the 85,000-member strong International Longshoreman Association.
Speaking to the Guardian, Chartered Institute of Export & International Trade director general Marco Forgione said that this, combined with existing pressures, such as geopolitical tensions and events like the Baltimore Bridge collapse have created a “highly fragile” global supply chain.
He also warned that increasing disruption could soon impact consumers:
“Where there is instability and uncertainty, the impacts are either price increases, ‘shrinkflation’, or you’re going to see availability issues”.
Good week/Bad week: The UN’s 193 member states agreed to a new pact to transition away from fossil fuels on Sunday, reported Euronews.
The pact consisted of a commitment to the UN’s 42-page blueprint for tackling a series of global challenges, that also included deescalating conflict, human rights and eradicating poverty.
UN Secretary-General Antonio Guterres declared “we are here to bring multilateralism back from the brink”.
“Now it is our common destiny to walk through it. That demands not just agreement, but action.”
Less great news for China this week, as both its own Purchasing Manager’s Index and the S&P suggested a contraction of manufacturing activity.
While production remains high, new orders, particularly international orders, have been in short supply, which manufacturers say is hitting export numbers.
With exports key to the country's growth strategy amid sluggish domestic performance, Beijing has unveiled a fresh round of stimulus, lowering interest rates and bank reservation requirements in a bid to boost lending and business confidence.
How’s stat? US$5bn a day – That’s the estimated cost of US dockworker strikes, according to analysis reported by the FT.
The week in customs: New rules around pork imports led this week’s Customs Corner, as an outbreak of African Swine Flu has prompted new restrictions from the Department for Environment, Farming and Rural Affairs.
Quote of the week: “Dismissing the idea of reciprocal youth mobility simply means letting down British young people, who face all sorts of economic difficulties and have seen their horizons curtailed by Brexit.”
Sir Nick Harvey, chief executive of European Movement UK, exemplifying some of the internal pressure prime minister Sir Keir Starmer is facing to agree a new Youth Mobility Scheme with the EU.
As Starmer visits Brussels this week, European Commission president Ursula von der Leyen will also be advocating for the scheme. Starmer has so far insisted there are “no plans” for such a deal, amid political concerns around public perceptions of immigration.
What else we covered this week: Members can learn more about the new AUKUS exemption with the US’ export control legislation: International Traffic in Arms Regulation (ITAR). Experts discussed the new changes in last week’s export control special interest group.
There’s also an opportunity to get to know our new head of membership, Sophie Tothill, who spoke to the Daily Update about what trade professionals can expect from their Chartered Institute membership in the coming months.
We also have coverage of the discussion that took place at the Chartered Institute’s Conservative Party Conference panel this week. Amid a “shifting” global trade landscape, senior party speakers suggested the UK should pay careful consideration to its tax and regulatory environment to stimulate investment.
True facts: One of products most associated with the EU’s deforestation legislation – now delayed to next year – palm oil, has been supplanted as the world’s cheapest edible oil.
Bloomberg reports that due to the reluctance of Malaysian and Indonesian farmers to harvest any more of the trees required for the crop, soy oil has become cheaper.
Palm oil prices have risen 10% this year, whereas soybean oil has fallen about 9%.
The product is found in a range of common consumer goods, from food to cosmetics and even biofuel. The publication reports that a range of manufacturers and restaurants worldwide are now looking for alternatives to palm oil.
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