The government of the world’s second biggest garment exporter behind China said this week it would consider demands for an increase in the minimum wage, after clashes between police and protesters killed one worker and wounded dozens. The government said in September that the minimum wage for garment workers would increase by up to 51 percent this year to 8,000 taka ($95) a month, the first such increase since 2013. But union leaders say that increase will benefit only a small percentage of workers in the garment sector, which employs 4 million in the country of 165 million people. Low wages and trade deals with Western countries have made the sector a $30 billion industry accounting for 80 percent of Bangladesh’s exports.
Pakistan started to devalue its currency beginning from 2017 and until now it has depreciated more than 50% against the US Dollar, triggering a ripple effect across its export sector, and making it more competitive in low-wages industries. PKRUSD
With regard to garment industry, Bangladesh1 had a per month minimum wage of $64 in 2018 versus $136 in Pakistan. However things have quite changed since then in 2019, Bangladesh has raised the wages to $95 and on the contrary Pakistan’s minimum wage per month declined to $1072 due to massive currency devaluation.
However, the chances of the textile and clothing exporters increasing their share in international trade — both in terms of export value and quantity — despite emerging global opportunities are minimal because of the shrinking size of the industry. The industry’s capacity to produce exportable surplus has contracted substantially because of factory closures on the back of crippling energy shortages that hit the economy in the second half of 2000s, the previous government’s obsession for an overvalued rupee, lack of investment in new more efficient technologies and capacity, the controversial free trade agreement with China and so on.
However lower wages alone are not going to help Pakistan increase its global market share, due to lack of the production capacity as the above article stated. Government must work toward attracting foreign investment in the textile and garment sector., as well as encourage local industrialists by facilitating them with cheaper energy prices, and waiving duties and taxes on the import of textile machinery and its parts altogether.
The total exports to the USA during July-February (2018-19) were recorded at $2684.394 million against the exports of $2529.610 million during July-February (2017-18), showing an increase of 6.11 percent during the period, according to State Bank of Pakistan (SBP). This was followed by United Kingdom, wherein Pakistan exported goods worth $1171.950 million against the exports of $1161.099 million last year, showing growth of 0.93 percent. China was the at third where Pakistan exported products worth $1150.523 million during the current fiscal year against the exports of $1107.004 million during last fiscal year, showing increase of 3.93 percent, SBP data revealed. Among other countries, Pakistani exports to Germany stood at $869.763 million against $909.251 million during last year, showing decline of 4.34 percent while the exports to Afghanistan were recorded at $777.292 million against $1008.555 million last year, the data revealed.
I guess, it most likely would be due to trade war and tariff on the chinese goods as well as over 30% currency depreciation1 against the US Dollar in the past year, rather than our Govt., doing anything to help the local industries.
Difference in % YoY Monthly Basis. Exports started to trigger after 2017, when Govt decided to devalue Rupee against US Dollar over 50% since 2017. PKRUSD
Pakistan’s Total Exports expanded 19.1 % YoY in Jun 2019, compared with an increase of 24.1 % YoY in the previous month. Pakistan’s Total Exports Growth data is updated monthly, available from Dec 1988 to Jun 2019, with an averaged rate of 12.9 %. The data reached an all-time high of 53.4 % in May 1991 and a record low of -19.2 % in Sep 2015. CEIC calculates Total Exports Growth from monthly Total Exports. The Pakistan Bureau of Statistics provides Total Exports, FOB, in local currency.
An HS or HTS code stands for Harmonized System or Harmonized Tariff Schedule. Developed by the World Customs Organization (WCO), the codes are used to classify and define internationally traded goods. In most cases, in order to import or export a product internationally, the traded good must be assigned an HTS code that corresponds with the Harmonized Tariff Schedule of the country of import1.
The difference between an HS code and HTS code is the number of digits within the code. A code with six digits is a universal standard (HS Code) and a code with 7-10 digits (HTS Code) is often unique after the 6th digit and determined by individual countries of import.
These codes are important because they not only determine the tariff/duty rate of the traded product, but they also keep a record of international trade statistics that are used in nearly 200 countries. For example, the United States Census uses these codes to determine the value, quantities, weights, countries traded with, and more, of every product that the United States imports and exports.
|Definition & Example for U.S HTS Code
||Coffee, Tea, Matte and Spices
||Coffee, Whether Or Not Roasted Or Decaffeinated; Coffee Husk, and Skins Coffee substitutes containing Coffee.
||Coffee, Roasted, Not Decaffeinated
||Coffee, Roasted, Not Decaffeinated, Certified Organic
Third-party logistics (abbreviated as 3PL, or TPL) in logistics and supply chain management is an organization’s use of third-party businesses to outsource elements of its distribution, warehousing, and fulfillment services.
Third-party logistics providers typically specialize in integrated operations of warehousing and transportation services that can be scaled and customized to customers’ needs, based on market conditions, to meet the demands and delivery service requirements for their products.
Often, services exceed logistics to include value-added services related to the production or procurement of goods, such as services that integrate parts of the supply chain.
A provider of such integrated services is referenced as a third-party supply chain management provider (3PSCM), or as a supply chain management service provider (SCMSP). 3PL targets particular functions within supply management, such as warehousing, transportation, or raw material provision.
Source en.wikipedia.org PDF 159KB
An ocean transportation intermediary (OTI) is a company that is licensed by the Federal Maritime Commission (FMC) to operate in the United States as an ocean freight forwarder, non-vessel operating common carrier (NVOCC), or both.
How to Apply for an OTI License. www.fmc.gov
What is an OTI Bond?
OTI bonds are required by the Federal Maritime Commission (FMC) from all ocean freight forwarders (OFFs) and non-vessel-operating common carriers (NVOCCs) who wish to become licensed as ocean transportation intermediaries (OTI) and operate in the United States.
The cost of your OTI bond depends on its bonding amount– whether it’s a $50,000, $75,000, $96,000, or $150,000 bond. When determining the rate or surety premium of a bond, sureties base it on the total bonding amount and make it a percentage thereof.
To determine your rate, sureties look at your personal credit score first and foremost, and at other financial and business-related items, such as your financial statements or industry experience.
If you have a high credit score and a solid business history you can expect to receive a standard market rate: from 1%-5% of the total amount of your bond. If your credit score isn’t that high, the surety will typically offer a rate that’s between 5%-10% of the bonding amount.
So, to obtain a NVOCC bond at standard rates for a licensed U.S. entity you would have to pay between $750 and $3,750.
For complete details visit Lance Surety Bonds website. www.suretybonds.org
Complete List of Registered OTIs / NVOCCs 2019 By FMC Records 364KB
Chaim Gartenberg / Verge
Google is said to be starting by shifting some of the Pixel 3A’s manufacturing to the Vietnam plant, with the goal of moving production there before the end of this year. New products are still expected to be built in China for now, which likely will include the forthcoming Pixel 4. Google isn’t the only company eying Vietnam for phone production: an earlier Nikkei report notes that Apple may be looking to shift between 15 to 30 percent of iPhone production to Vietnam and India to avoid tariffs, too.
Honestly I had been skeptical of Vietnam’s production and infrastructure capabilities. But it seems like they can still produce / assemble high-end consumer electronics too. Along with Malaysia, Taiwan and India to avoid tariffs. However as the article noted, the next iteration of Pixel Phones 4, still to be built in China.
Apple has asked its major suppliers to evaluate the cost implications of shifting 15% to 30% of their production capacity from China to Southeast Asia as it prepares for a fundamental restructuring of its supply chain, the Nikkei Asian Review has learned.
Yearly Volume in Million of TEUs.
||Guangzhou Harbor, China
||Busan, South Korea
||Hong Kong, S.A.R, China
||Jebel Ali, Dubai, United Arab Emirates
||Rotterdam, The Netherlands
||Port Klang, Malaysia
||Kaohsiung, Taiwan, China
||Los Angeles, U.S.A
||Tanjung Pelepas, Malaysia
||Long Beach, U.S.A.
||Laem Chabang, Thailand
||Tanjung Priok, Jakarta, Indonesia
||New York-New Jersey, U.S.A.
||Colombo, Sri Lanka
||Ho Chi Minh City, Vietnam
||Jawarharlal Nehru Port (Nhava Sheva), India
||Jeddah, Saudi Arabia
||Seattle-Tacoma NW Seaport Alliance, U.S.A.
||Tanger Med, Morocco
||Cai Mep, Vietnam
Rank No. 1 Shanghai, China. 2014-2018 Volume in Millions of TEUs. We shall find out after the end of FY 2019, If Shanghai could maintain its volume increase YoY post the tradewar.
Top 10 Container Seaports in terms of Yearly Volume in Millions of TEUs from 2014-2018
Top 50 Container Seaports 2014-2018 57KB
EuroAirport is one of the few airports in the world operated jointly by two countries, in this case France and Switzerland. It is governed by a 1949 international convention. The headquarters of the airport’s operations are located in Blotzheim, France. The airport is located completely on French soil; however, it has a Swiss customs area connected to Basel by a 2.5 km (1.6 mi) long customs road, thus allowing air travelers access into Switzerland bypassing French customs clearance. The airport is operated via a state treaty established in 1946 wherein the two countries (Switzerland and France) are granted access to the airport without any customs or other border restrictions. The airport’s board has 8 members each from France and Switzerland and two advisers from Germany.
This airport has three different IATA airport codes: BSL (Basel) is the Swiss code, MLH (Mulhouse) is the French code and EAP (EuroAirport) is the neutral code.
And It could possibly have four, if Germany had wanted to assign it of their own too. Normally all airports are assigned a single IATA airport code.