Global Economy, Competitiveness, Foreign Trade, Imports & Exports, Economic Environment, Energy
Canada boasts the world’s third largest oil reserves, after Saudi Arabia and Venezuela. This standing rests on the country’s oil sands in the Western provinces of Alberta and Saskatchewan, the large-scale exploitation of which began a decade ago. The U.S. is currently the near-exclusive non-domestic outlet for Canadian oil, in the form of crude as well as raw and upgraded bitumen (or synthetic crude): it buys 97-99 percent of Canada’s crude oil exports. Canadian refining capacity is limited, and no real network exists—yet—to move oil economically and efficiently within Canada.
Finance, Tax, U.S. Tax, Federal Tax Rules & Regulations, U.S. Tax Policy, Leadership, Human Resources, Benefits, Health Benefits
Proposed rules released by the IRS explain how large employers will be assessed if they fail to provide affordable health insurance coverage to their full-time employees and dependents. Understanding the definitions for these terms is key to what the rules do. A “large employer” has more than 50 full-time employees. “Full-time employees” work at least 30 hours per week, but two employees who each work 15 hours per week equal one full-time employee for purposes of the calculation. “Affordable coverage” depends on the employee’s income and the benefits offered, which should exceed an as-yet undefined level of minimum essential coverage. And the benefits must be offered to dependents.
Finance, Tax, U.S. Tax, Federal Tax Rules & Regulations, U.S. Tax Policy
In the early hours of 2013, Congress and the White House were able to avert an immediate fiscal crisis. The last-minute deal delayed deep, automatic spending cuts and did not address the debt ceiling, setting the stage for upcoming battles over spending and the deficit. The American Taxpayer Relief Act of 2012 does, however, contain several tax provisions important to manufacturers. The package provides some much-needed certainty with respect to the individual rates, helping businesses taxed as flow-through entities, but it does not solve many of the deep, underlying problems with the tax code that undermine the United States’ economic growth and international competitiveness.
While the recent attention paid to rising U.S. oil production clearly is warranted, the other side of the coin—the trend in U.S. petroleum consumption—also deserves recognition because it is no less dramatic, especially against the backdrop of long-term forecasts made just a few years ago.
On August 22, 2012, after 18 years of negotiations, Russia became the 156th formal member of the World Trade Organization (WTO). With the world’s ninth largest market, a $1.9 trillion economy, and—with a population of 140 million—Europe’s number one consumer market, Russia was the largest economy in the world that was not a member of that august international trade governing body. As part of its accession package, Russia agreed to implement a host of economic reforms that will further open the country’s markets to the goods and services of its WTO trading partners, ensure greater respect for the rule of law, better protect intellectual property rights, and safeguard foreign investors.
The housing sector has been the poster child for the part of the economy that has lagged during the economic recovery. The housing bubble that existed prior to 2007 was characterized by buyers with no or a low down payment and teaser interest rate mortgages who bet on price appreciation as well as speculative investors hoping to “flip” their purchases amid rapidly rising prices. Low interest rates, falling lending standards, and creative financial engineering of collateralized mortgage instruments helped finance housing purchases. Further, government policy aided and abetted the housing mania. The result was a period in which additions to the housing stock exceeded what population demographics would dictate.
Manufacturers can help policymakers better understand their needs: first, by helping lawmakers gain a true appreciation for manufacturing's importance to economic growth; and second, by alerting them to the very real challenges that American manufacturers face, many of which stem from negligence on the part of policymakers. To this end, MAPI has done the research for NAM's 9th edition of The Facts About Modern Manufacturing, a snapshot of how American manufacturing is faring in this evolving global marketplace.
Global Economy, Competitiveness, Government Policy, Operations, Supply Chain
With its Plan Nord, the Quebec government has committed to generating CAD 80 billion in investment over 25 years in the north of the province, including several billion public dollars to build core infrastructure and improve local socioeconomic conditions. The area’s resources include 75,000 square miles of commercial forest; vast hydroelectric, wind, and solar power potential; unspoiled landscapes and wildlife to sustain tourism; and important mineral resources—including rare earth elements.
A few years ago, many (if not most) energy analysts expected that U.S. oil production would continue its secular decline as older oil fields played out and as finding and developing new production capacity became increasingly difficult and expensive. At the same time, long-run projections showed U.S. oil consumption expanding over time as both the economy and population grew. Both projections have been stood on their head; the trends in production and consumption over the last five years dramatically illustrate how quickly the U.S. oil situation has reversed course.
China produces some 95% of rare earths but controls less than half of the global resource base. The country achieved this dominant position by lowering prices. Attractive pricing and the ability to avoid environmental consequences associated with mining and processing rare earths essentially prompted other countries to cede such operations to China.