Panama Canal: Return to normal in 2025, Argentina's favorable policies and restrictions are relaxed丨Foreign Trade Information Express
Panama Canal: Return to normalcy by 2025
The Panama Canal Authority (ACP) is working to restore normal operations after drought-related drafts and transit volume reductions.
Steady rainfall is forecast to arrive in late April and continue for several months. If this continues, the canal plans to gradually relax transit restrictions and expects full normalization by 2025.
ACP said in a press release that recent rainfall and water conservation measures have shown results and reversed the situation. Since May last year, ACP has continued to issue a number of decisions to reduce ship traffic and draft.
The drought exacerbated by the El Nino phenomenon has caused a large number of commercial ships to avoid the waterway due to long waiting times and high tolls. Three weeks ago, the Panama Canal Authority (ACP) increased the daily traffic of Panamax locks to three ships, bringing the maximum daily traffic to 27 times.
Although this is still more than 10 times less than the canal's maximum throughput under normal circumstances, it has sent a positive signal that the most difficult times are over.
Last week, Danish shipping giant Maersk announced that it would resume some routes through Central America that had been diverted by overland rail during the drought crisis after observing an improvement in the canal's water levels.
The ACP stressed that all adjustments to restrictions will be closely dependent on weather forecasts. If rainfall does not meet expectations, the canal may maintain or further tighten daily traffic and draft restrictions.
However, moderate rainfall is expected later this month, with the rain gradually increasing. The ACP said the rainfall will provide favorable conditions for the canal to gradually increase daily sailings, and the canal is expected to return to the 36 sailings per day during the regular rainy season.
Recently, ACP informed ship operators of the latest developments in the auction prices for additional space, which have experienced a significant increase over the past year.
The Panama Canal Authority said auction prices have stabilized and are now generally close to normal levels.
According to Clarksons Research, the Panama Canal carries 2.5% of global trade, but due to transit restrictions, its transit tonnage has been reduced by one-third. As the rainy season approaches, the latest forecast from the Panama Canal Authority (ACP) shows that
The water depth of Gatun Lake, a key water area in the middle of the canal, is expected to gradually rise starting at the end of May. This change is crucial to restoring normal operations of the canal.
Peter Sand, chief analyst at container freight platform Xeneta, commented: "Climate change and extreme weather phenomena such as El Niño have had a significant impact on our transportation system. Against this backdrop, the resumption of operations of the Panama Canal is particularly important. It is not only an important channel for global trade, but also a key part of our response to climate challenges and ensuring the stability of the supply chain."
US plans to strengthen UFLPA enforcement on inbound textile goods
According to the announcement of the U.S. Department of Homeland Security (DHS) on April 5, in order to further combat illegal trade and create a fair competitive environment for the U.S. textile industry, DHS has introduced a new law enforcement action plan for the textile industry, which will be implemented by the Customs and Border Protection (CBP) and Homeland Security Investigation (HSI) under DHS.
Several core tasks in the plan are closely related to UFLPA.First, give priority to reviewing violations of UFLPA by textile industry entities and add violating enterprises to the UFLPA Entity List; second, strengthen the screening of UFLPA violations for small packages by expanding the screening scope and strengtheningIsotope detectionUFLPA enforcement is carried out on imported textiles through other means.
Based on other recent industry information, in addition to textiles, U.S. law enforcement agencies are comprehensively strengthening UFLPA enforcement on incoming goods. CBP officials responsible for UFLPA enforcement revealed to the U.S. media that importers only submit paper documents of every transaction and supplier from raw materials to finished products, which is still not enough for CBP auditors to prove that there is no forced labor in the supply chain of detained products. If a batch of imported goods claims to use only raw materials from a certain supplier, CBP investigators will further verify whether the quantity of the raw materials can indeed produce enough finished products, and will also check invoices and bank statements to determine the actual flow of purchase funds. Therefore,Relevant companies, especially those in the textile industry that are listed as priority enforcement industries by CBP, will need to continue to pay attention to the legal developments of the US government in the future to avoid potential compliance risks.
Argentina's policies are favorable and restrictions are relaxed
On April 8, the Argentine government announced that the Ministry of Economy has cancelled the obligation for a series of products to undergo customs "red channel" inspection. This regulation requires strict customs inspection of imported goods, resulting in costs and delays for importing companies. From now on, the relevant goods will be inspected according to the random inspection procedures established by customs for the entire tariff.
The main products involved include textiles, footwear and electrical appliances.
Cancellation of the import red channel
Argentine customs inspections of imported goods are divided into three stages: green, orange and red channels. Previously, certain industries were required to accept the most stringent channel (red).
Sectors affected by the anti-dumping measures include textiles, footwear and products that are required to be cleared through the red channel, while radiators, air-conditioning units, fans, cutlery, thermoses, boilers and lids are also subject to the same scrutiny.
The red channel process requires stopping the clearance of goods at Argentine customs, prolongs the delivery period of products, and significantly increases the inspection costs borne by importers.
Faced with these cumbersome procedures, the Afghan government cancelled 36% of the import business listed as the red channel, which accounted for 7% of the country's total import business.
Implementation of a new import payment system
On December 13, 2023, the Central Bank of Argentina issued a regulation detailing how to enter the foreign exchange market according to various industries.
Previously, due to a serious shortage of foreign exchange reserves, Argentina required all imported goods to be declared in advance and obtain a license before they could be imported. In October 2022, Argentina launched a new import monitoring system (SIRA) mechanism to further strengthen import supervision. Even if Argentine importers have a quota to enter the foreign exchange market to exchange foreign exchange, under the new system, the time for foreign exchange payment that its central bank can approve is as long as 180 days.
According to the latest Notice No. 7917:
For import payments of goods, from December 13, 2023, it will no longer be necessary to have a SIRA with the "Export" status as a requirement for access to the foreign exchange market, nor will it be necessary to verify operations in the "Foreign Trade Unified Settlement Account" electronic system.
From December 13, 2023, for installment payments on newly imported goods with customs registration, banks can access the foreign exchange market without the prior consent of the Central Bank, provided that the payments follow a predetermined schedule for the type of goods. The schedule is as follows:
- a) The FOB value of fuel and electricity is payable immediately from the date of customs registration at entry.
- b) Within 30 calendar days from the date of customs registration of entry, payment can be made for medicines and/or raw materials for local pharmaceutical production, as well as other goods related to health care. In addition, payment can be made for fertilizers, plant protection products and/or raw materials for local production.
- c) The maximum payment period for finished vehicles and other final goods is 180 days.
- d) For other goods, payment of the FOB value may be made within the following time periods calculated from the date of entry customs registration: 25% from the 30th calendar day; an additional 25% from the 60th calendar day; an additional 25% from the 90th calendar day; and the remaining 25% from the 120th calendar day.
Although the Argentine government has recently relaxed import restrictions to reduce import costs and ease inflation, Argentina is still facing problems such as rising prices, shrinking industrial production, and declining economic activities. Data released by the Argentine Confederation of Medium Enterprises (CAME) showed that the retail sales of small and medium-sized enterprises in Argentina fell by 25.5% year-on-year in February.
Foreign trade companies exporting to Argentina still need to pay attention to risks!
U.S. urges allies to ban companies from servicing China's key chipmaking tools
According to Reuters, the United States urged its allies to ban companies from providing services to China's key chip manufacturing tools. U.S. Deputy Secretary of Commerce Alan Estevez said that the United States is currently discussing with its allies to promote the prohibition of providing services to China's key components.
It is reported that in October 2022, the Bureau of Industry and Security of the U.S. Department of Commerce issued export control regulations on the export of semiconductor manufacturing items to China, which restrict U.S. companies from providing services to Chinese semiconductor companies, but the export control regulations of the Netherlands and Japan do not have similar restrictions.
EU launches investigation into Chinese wind turbine suppliers in Europe
On April 10, the head of the Trade Remedy Bureau of the Ministry of Commerce met with Martin Lucas, Director General of the Trade Defense Department of the European Commission, in Brussels, and made solemn representations to the EU on issues such as the subsidy investigation launched against Chinese wind turbine suppliers and the re-release of a report on "serious distortions" in the Chinese economy.
China pointed out that on April 9, the EU announced an investigation into China's wind turbine suppliers in five EU countries based on the Foreign Subsidies Regulation (FSR). This is the fourth investigation case launched by the EU against Chinese companies using the FSR in the past two months.
China believes that the FSR investigations launched by the EU so far are all aimed at Chinese new energy-related enterprises, with clear targets. They not only seriously undermine the confidence of Chinese enterprises in conducting investment and trade cooperation in Europe, but also interfere with the mutually beneficial industrial cooperation between China and Europe. They will also affect the global efforts to address climate change and the process of green transformation. During the investigation, the EU willfully distorted the definition of subsidies, and the procedures and standards were not open and transparent. This is a protectionist behavior that damages the fair competition environment in the name of fair competition. China expresses strong dissatisfaction and resolute opposition to this, and urges the EU to immediately stop and correct its wrong practices.
It is understood that on April 9, Margrethe Vestager, chief of competition affairs of the European Union, said in a speech at Princeton University in the United States: "We are launching a new investigation into Chinese wind turbine suppliers."
Vestager also said the EU was investigating the conditions under which wind farms are developed in Spain, Greece, France, Romania and Bulgaria.
In addition, China also expressed its solemn position on the EU's report on "serious distortions" in China's economy, which was released again on April 10. China said that the EU updated the relevant report and once again distorted China's policies, market environment and economic system, creating excuses for subsequent discriminatory anti-dumping measures. China expressed its high concern and strong opposition to this.
China pointed out that the WTO rules do not have the concept and standard of "serious distortion" of the economy. The EU's unilateral "serious distortion" standard to evaluate China's market economy is totally inconsistent with the facts and will bring negative impact and uncertainty to China-EU economic and trade relations. China will closely follow the EU's subsequent moves and reserve the right to take all necessary measures.
India releases new rules for imported urea
Recently, the Indian Directorate General of Foreign Trade (DGFT) issued a notice on the revision of urea import policy, requiring that the import of urea (HS 31021000) must meet the following conditions:
(1) Under the Foreign Trade Policy 2023, import of urea through Rashtriya Chemicals and Fertilizers Limited and National Fertilizer Limited is permitted. In addition, import of urea through Indian Potash Limited is permitted from now till March 31, 2025.
(2) Only designated state-owned enterprises (STEs) and any entity authorized from time to time by the Department of Fertilizers (Fertilizer Selling Entities) may import agricultural urea or agricultural urea for government procurement projects, and the Fertilizer Selling Entities are required to submit relevant documents after the goods arrive at the port.
Brazil sees massive influx of Chinese electric vehicles ahead of new tariffs
Brazil's auto imports surged in the first quarter of 2024, driven by a flood of electric vehicles from China. From January to March, Brazil's passenger car imports increased 46.4% year-on-year to $1.5 billion, data released on Thursday by the Ministry of Development, Industry, Trade and Services showed.
Of this, Chinese cars alone accounted for about 40%, with imports surging 450% over the same period in 2023. Saulo Castro, the ministry's statistics coordinator, said that cars imported from China drove the growth in car imports, which were mainly pure electric and hybrid cars.
Import taxes on electric vehicles have been reduced to zero since 2015, but Brazilian President Lula will restore them this year to encourage the development of the domestic auto industry. From January, the import tariff on pure electric vehicles will be 10%, which will increase to 18% in July and eventually reach 35% in July 2026. Hybrid vehicles will be subject to an import tax of 15% starting this year, which will increase to 25% in July and reach 35% in July 2026.
Domestic motorcycle exports hit a record high in the first two months of this year
From January to February this year, the total export value of motorcycle manufacturing enterprises was US$1.143 billion, a year-on-year increase of 31.8%. The export volume of complete vehicles was 1.387 million, a year-on-year increase of 48.1%, and the export value was US$919 million, a year-on-year increase of 37.38%.
The China Motorcycle Chamber of Commerce said that motorcycle exports continued to maintain a good development trend, with cumulative exports from January to February hitting a record high for the same period in history. The overall demand in the domestic motorcycle market has slowed down significantly, but the sales of some large-displacement leisure and entertainment motorcycles have achieved significant growth. In sharp contrast to the growth in production and sales of fuel motorcycles, the decline in production and sales of electric motorcycles.
SAFE launches new measures to optimize foreign exchange management for trade
The State Administration of Foreign Exchange issued a notice on April 7, launching six policy measures to optimize foreign exchange business processes, further promote cross-border trade facilitation, and improve the quality and efficiency of services to the real economy. From the content of the notice, these six policy measures mainly include optimizing the registration and management of foreign trade enterprise lists, facilitating the settlement of foreign exchange receipts and payments for cross-border trade of enterprises, and clearing and integrating the foreign exchange management regulations for goods trade. For example, the handling method of the "trade foreign exchange receipts and payments enterprise list" will be adjusted from approval by the State Administration of Foreign Exchange to direct handling by banks; simplifying the trade receipts and payments procedures for enterprises in special customs supervision areas; and relaxing the authority of banks to handle special refunds for goods trade.
This notice shall be effective from June 1, 2024.
Full notice:
http://www.safe.gov.cn/safe/2024/0407/24204.html
Source: Focus, One Shipping, Shipping Today, etc.
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