This column highlights the past week’s most interesting and useful business and financial commentary on global trade from around the Web
“Canada, India Clinch Nuclear Trade Deal”
Forty years ago, India used Canadian technology to build its first nuclear bomb. This week, Canada and India have inked the first nuclear trade agreement since, which will allow Canada to ship uranium and various other nuclear supplies to India. The Canadian uranium will be used to fuel India's nuclear reactors, which supply the country’s swelling energy needs. Read More at the Daily News.
Canada’s three largest uranium miners (by market cap) are Cameco Corp.
(NYSE:CCJ), Uranium One
(TSE:UUU), and Paladin Energy
“China, US, Europe Battling Over Shrinking Global Trade Pie”
At this week’s Asia-Europe in Summit in Laos, China, the eurozone slung accusations, the Chinese accusing the Europeans of accumulating debts that jeopardize the global economic recovery, and the Europeans complaining China manipulates its currency. Trade experts say these shots echo the trepidation among the world’s leading economies as the global recession continues through its fifth year with no clear sign of reversal. Read more at the Los Angeles Times.
“Suzuki’s Small Cars Were Wrong Fit in US”
(TYO:7269) US wing, the American Suzuki Motor Corp, announced it had filed for bankruptcy on Monday. This comes after years of the Japanese automaker trying to fit its way into the US market, alas, to no success. Despite the company’s retreat, Susuki is taking advantage of emerging markets, and has seen success via Maruti Suzuki India Ltd
(BOM:534500). In India, demand for the cheap and compact vehicles offered by Suzuki is high. This goes for much of Southeast Asia as well, where Suzuki is seen growing its market share. Read more at the New York Times.
“Brazil Scrap Producers, Mills Clash Over Potential Export Tax”
A possible scrap metal export tax has driven Brazil’s big steel and scrap metal producers to dispute. A proposed levy would severely restrict scrap producers' pricing power, and spells potential problems for Brazil’s largest producer of long steel, Gerdau SA
(NYSE:GGB), as well as the local unit of Luxembourg-based mining and steel maker ArcelorMittal
(NYSE:MT). With two-thirds of Brazil’s scrap metal destined for export, the tax threatens trade flows to countries like China, India, and Iran. Read more at Reuters
“What Wall Street Doesn’t Understand About International Trade”
A research paper from Harvard Business School professors purposes it is possible to forecast whether a US company will trade with a foreign country by studying the “ethnic makeup” of local communities, and that those companies that align their activities with this local ethnic makeup notably outperform those that don’t. The authors of this paper suggest that a their findings could aid Wall Street in building better earnings performance forecasts. Read more at Working Knowledge
No positions in stocks mentioned.
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