Feb/Mar 12
Volume 9 | Issue 1

World Trader

From the President: World on Fire?

ACE – the "New” System for Customs
by Jordan Brunsberg, MGTA intern and Nic Adams, Customs Now, Inc.

Upcoming Events

Help the MGTA Reach 50 New Members

Language for Global Communication
by Roberto Fonts, Dialog One LLC

Volunteer Spotlight: Angie Dammeier

Country of the Month: Panama
by Kevin Johnson, Best Buy

Member News

Who Said it?


From the President: World on Fire?

by Jim Moore, MGTA President

Jim MooreYou may have heard of or read Amy Chua’s book, published back in 2004, with the same title. It seems like we have entered a period of relative instability in global affairs. While the US is finally winding down its shooting wars, the Syrian and Iranian crises are the most recent in a continuum of world events that threaten global stability. While our focus in the business world is often on economic issues like the European Union sovereign debt crisis, political, human rights, religious and cultural conflicts are always playing in the background, creating the context in which we must conduct global trade.

The world was a simpler, if not more secure place, when the East and West were symmetrically divided by the Iron Curtain, facing each other across a clearly defined set of borders, armed with nuclear arsenals of immense destructive power. In our more complex universe of constantly shifting alliances, emerging and declining states, uprisings and repressions, we cannot rely on political stability for long periods. If that is the case, what can we look to for stability in our pursuit of prosperity and commerce across political, economic and other boundaries?

Anyone who has been successful with business dealings in China is familiar with the concept of Guanxi. The word translates most literally in English to "relationships.” The real meaning is deeper – it means the achievement of trust, respect and understanding. In business, it leads to lower risks, mutual benefit and a tendency to cultivate long term relationships. To listen to understand, be reluctant to judge – even to give small gifts as tokens of respect and offers of friendship – characterize the spirit of Guanxi.

We in the global trade community may have the opportunity to model the behaviors of a world that can bridge the differences in culture and individual interests. Organizations – governments, religions, races, ethnicities, companies – cannot have relationships; only people can. If we practice the spirit of Guanxi in our business dealings we may inspire our colleagues, and others partners to bank the fires of global conflict.

Jim Moore, MGTA President

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ACE – the "New” System for Customs

by Jordan Brunsberg, MGTA intern and Nic Adams, Customs Now, Inc.

Jim Moore

Jim Moore

The acronym ACE has been around for a long time. It stands for the "Automated Commercial Environment,” a complete revamp of the United States Customs and Border Protection’s processes and systems. At its core, ACE is divided into two main functions: an electronic database that will hold all existing requirements presented by government entities that affect trade movements, and a comprehensive electronic processing system for commercial trade transactions. This electronic system will relieve many importers’ headaches by providing one central resource for compliance information and updates. It will also eliminate most paper transactions, enabling importers and brokers to work more quickly and efficiently.

While these promises seem very appealing, they may also sound like a broken record to many professionals who have been waiting for ACE to fully launch since around 2006. Originally released for initial trials in 2009, ACE was meant to replace the old CBP system, ACS, but has been slowly developed and poorly marketed. Instead of saving importers and the CBP time and money, as it was created to do, ACE is actually costing them around double the amount that they were spending before its development. Why? ACE has divided importers between the old system and the new one for the last three years, forcing CBP to continue funding updates and edits to both during this lengthy "transition.” Many are wondering if ACE will ever reach its full potential, and when it does, if it will already be obsolete. To get to the bottom of the current status of ACE, MGTA spoke with member Nic Adams from Customs Now. Nic is a current member of the Trade Support Network and attended the last TSN Plenary event for ACE in 2011.

Nic began by enthusiastically recognizing the advantages that ACE offers to importers and brokers. The genius of ACE is that it is a more business intuitive system than ACS. ACE will greatly simplify entries for most importers, especially the larger ones, because it allows companies to work on an account basis, rather than a transactional one. Importers can file cumulative summaries at the end of the month to document all of their received shipments, instead of after each individual one. Furthermore, post-summary corrections will no longer have to be formally filed a short ten days after a shipment entry has been locked. Instead, ACE allows these corrections to be submitted electronically up to 270 days after the initial date of entry. "This alone should be a big enough incentive for many importers to switch over to the new system,” said Nic. Beyond these larger changes, ACE offers a lot of other minor advantages like instant data population for repeat field entries, the ability to send releases before vessels depart from the U.S., and better transparency and instant updates on the statuses of regulations that impact trade. The list goes on, and can be viewed in full on the CBP’s website.

Unfortunately, as Nic willingly admitted, ACE does come with its disadvantages. The main concern of many importers and brokers is the number of edits, or compliance updates and verifications, which ACE has yet to incorporate into its system. Many companies rely on these double checks from the ACS system because they do not have them in place in their internal systems. When these companies switch over to ACE, they may lose the more detailed of these "red flags.” Due to the aforementioned split funding, ACE has had to focus on deploying more functionality versus incorporating the edit. However, on a recent TSN Entry Committee conference call, CBP stated that they expect to begin programming the edits in 2012.

Nic’s other concern was the continued release of new functionality, like more complicated entries or manifest filing updates in ACE, because they can lead to instability as the CBP continues to edit both systems simultaneously. Manifest filing was traditionally done in ACS, so when ACE was just beginning to develop, all manifests in ACE would have to be double checked in ACS. Now, as ACE moved toward full deployment, manifest filing is slowly being switched over, and the transition is causing some kinks. For example, one recent release of M1 (manifest) functionality caused some entries filed in ACS or ACE to receive "Release Date Updates” indicating a release date in the year 2020! Until the system is fully deployed, and all bugs are corrected, importers may continue to encounter these "bumps in the road.” The good news is that ACE and the CBP have promised that any entry problems caused by these deficiencies will be overlooked until the system has been corrected. While this may be a pain in the short term, to Nic, the long-term benefits of ACE seem to outweigh its initial shortcomings. Like all things in life, it may just take some patience and good faith.

The main obstacle that ACE faces in overcoming these problems is funding. With importers and exporters still divided among the two systems, ACE has had to abandon its initial "Big Bang” approach, which would allow for one large release of a fully functional system, for a less dramatic strategy calling for several mini updates to a mostly-functional system. In theory, these small updates will eventually culminate in a comprehensive and perfected system, but not until importers and brokers begin putting their faith into ACE. "It’s a catch 22,” admits Nic, but what ACE needs now is for importers and brokers to "jump in” and switch over to the new system. As more and more companies begin to adopt ACE, congress can begin pulling funding out of ACS and appropriate it back into further development projects to address ACE’s aforementioned issues. Right now, however, the development of this new system simply is not receiving the ideal amount of funding or resources it needs to release a perfect product.

So the major question remains, why should U.S. importers and brokers adopt ACE now, after so many years of slow development? Well, Nic seems to feel like this time the tides have truly changed, thanks to new leadership. The recession took a toll on the planning process. Experts weren’t flying to the Plenary Sessions, and companies were more concerned with staying afloat than adopting new innovative operating systems. "The energy at the 2011 TSC Session was different, though.” There was a large crowd and determined leaders who were finally "speaking in terms of days and weeks instead of months and years.” Leaders like Cindy Allen, the newly appointed CBP director in charge of ACE, and Allen Gina, a 29-year veteran of the CBP who compared the current U.S. border situation to a highway traffic-jam. It is their firm opinion that ACE will be a prominent actor in driving down costs for importers so that U.S. trade can once again flourish at pre-2008 levels. Finally, it is important to note that this same panel expects that in 2014, ACE will be sufficiently updated to the point where congress will mandate that all importers and brokers adopt the new system.

"It’s time for our industry to support the development of the Automated Commercial Environment…competitive advantages will begin to accumulate for those members who start transitioning to ACE now.” – Jeff Coppersmith, President of the National Customs Brokers and Forwarders Association of America.

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Upcoming Events


Heartland Shippers Conference

April 17-18, 2012
Embassy Suites on the River, Des Moines, IA

The U.S. Midwest is home to major manufacturing, agriculture, and a significant consumer market of over 66 million. Conversely, getting cargo in and out of the nation’s heartland is challenging for a variety of reasons, and the Heartland Shippers’ Conference will address these themes among others pertinent to the global supply chain’s vital connection to the region and its developing infrastructure.

Dynamic networking opportunities include Cargo Business News’ popular Collaboration Dinners held in fine eateries conveniently located throughout Downtown Des Moines, along with receptions and opportunities to meet and mingle with customers, prospects and service providers.

Register now


Country of Origin

April 19, 2012
12:30 pm - 5:00 pm
Quality Bicycle Products (QBP – Central), 6400 W. 105th St., Bloomington, MN

A product’s rule of origin is its "passport” in international trade. The nationality ascribed to a product will determine whether and where it can be traded, what duties and import restrictions may apply, whether the product can be offered in government procurements.

This program will provide an in-depth review of rules of origin currently used by the United States, and will discuss their importance to international trade management, as well as NAFTA rules in addition to FTC guidelines for "Made in USA.”

Register now

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Help the MGTA Reach 50 New Members

The MGTA is holding a new member recruitment campaign aimed at securing 50 new members during 2012. We’re asking for your help and, in return, we’ll offer you a $10 Target gift card for every new member you recruit up to our 50 member goal. Just make sure the new members you recruit write your name in on the referral line of their application.

Sign up a colleague today and earn your free Target gift card.

See what our members say about why they’re a part of the MGTA:

"I feel there are many benefits to being a member worth the investment.”

"I'm anticipating more International seminars that will add value to our staff.”

"We are growing our exporting business and have every reason to continue our membership!”

"I need to be on top of changes as well as to have open options for education.”

"Trainers/presenters are typically very good, knowledgeable, and experienced.”

"It's important to stay connected with Trade.”

"We find great value in the organization from an educational and networking perspective.”

"MGTA is the international trade association in MN.”


CLICK HERE for a Membership Application

Read additional member testimonials here.

See the benefits of MGTA membership here.

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Language for Global Communication

by Roberto Fonts, Dialog One LLC

Cultural Mediators, Interpreters, and Translator are essential for any business in this global economy. These services share some common traits but they are distinctively different in their functions.

What Is a Translator?
Translators convert written materials from one language into another, including Braille. It is more than replacing a word with its equivalent in another language — sentences and ideas must flow with the same coherence as those in the source document so that the translation reads as though it originated in the target language.

Translators must have excellent writing, analytical, and editing skills plus a cultural background in both languages; cultural references may need to be explained, such as colloquialisms or slang that do not translate literally. Phrases are more difficult to translate when they have multiple meanings.
Assignments of course vary in length, writing style, and subject matter. First, translators read it through, look up any unfamiliar words, and often consult with the document’s originator to clarify unclear ideas or acronyms, then re-read as needed. Not surprisingly, translated work often goes through multiple revisions.

Advances in technology allow most translations to be received, composed, and delivered electronically. Translators can work from almost anywhere, and many of them work from home, others in controlled environments for businesses or governmental units that require it. They have advanced research capabilities and valuable language resources, such as specialized dictionaries and glossaries. In some cases, use of machine-assisted translation — including memory tools that provide comparisons of previous translations with current work — helps save time and reduce repetition.

What Is an Interpreter?
An Interpreter is a person who provides a verbal translation between speakers who speak different languages, usually during a live conversation. The Interpreter must be fluent in at least two languages — their native (primary) one plus at least one other language. Both languages are considered active skills, but their cultural knowledge related to the other language(s) is often limited.

How Is a Cultural Mediator Different?
Although some people may think they can do both, Interpretation and Cultural Mediation are different professions. They require distinct sets of skills and aptitudes; most people are better at one or the other. Interpreters translate spoken words during a conversation. Cultural Mediators (CMs) are facilitators of mutual understanding between people; their actual understanding of cultures makes a difference in the conversation. CMs must thoroughly understand both the subject matter and the cultural context associated with the source and target languages. Strong listening and analytical skills, mental dexterity, and an exceptional memory are also required. CMs generally work to forward the whole conversation inside the realm of both languages and cultural backgrounds. This requires CMs to pay attention carefully — to understand what is being communicated in both languages — and then express those thoughts and ideas into reality.

The Cultural Mediator’s work begins before arriving at the session. The CM must be familiar with the subject matter the speakers will discuss, which may involve researching common words and phrases associated with the topic. Next, the CM travels to the location or uses remote video conferencing for the session. Nonverbal language is an essential element to capture for effective communication; seeing the dialogue in action is required to relay the message to the other party accurately.

Language Translation Modes
There are two types of oral language translation delivery modes. Simultaneous translation requires the CM to listen and speak (or sign) at the same time; consecutive translation is delivered as groups of words or sentences. Consecutive translating is used most often for person-to-person communication, during which the CM is positioned near both parties and the CM often takes notes while listening to the speakers.

In simultaneous mode, the CM begins to convey a sentence being spoken while the speaker is still talking. Ideally, the CM should be so familiar with the subject that they anticipate the end of the speaker’s sentence. Because a very high degree of concentration is needed, CMs work in pairs — trading off listening and speaking for 20- to 30-minute periods.

Simultaneous translation is normally used when individuals with Limited English Proficiency are attending public or private meetings, including international business and diplomacy — any organization that works with foreign language speakers. This service is required at international conferences and is sometimes used in courtrooms. However, at some meetings with a small number of attendees, consecutive may also be used with CMs sitting in soundproof booths, listening to the speakers through headphones, and communicating to listeners through headsets. When the service is needed for only one or two parties, the CM generally sits near the attendee and whispers the translation.

Cultural Mediators and Interpreters accompany parties to ensure that they are able to communicate during their stay, both informally and on a professional level. In this case, most of their delivery mode is consecutive, and work is generally shared by two cultural mediators when the assignment requires more than an 8-hour day. Frequent travel is common, often for days or weeks at a time, an aspect of the job that some find particularly appealing.

Going Global
Many people prefer high-level professionals who have the ability to translate from at least two passive languages into one active (native) language — for example, the ability to interpret from Spanish and Arabic into English. For some positions, such as those with the United Nations, this qualification is mandatory.

Businesses and organizations all over the world are looking for translation professionals to expand their conversations into a global marketplace. Dialog One will help you communicate from and into any of those languages. Is your business, are you prepared to go global?

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Volunteer Spotlight: Angie Dammeier

Q: How long have you been involved in global trade and what brought you to this industry?
A: I started out in the hospitality industry in Europe in the late ’90s. Through working in Germany, England, and the U.S., I realized that global trade was something I wanted to get more involved in. I got a degree in International Business and had my sights set on pursuing opportunities with German-American companies in the Midwest. Instead, I was persuaded to join the team of a humanitarian food relief organization in the Twin Cities and I have had the opportunity to grow with the organization ever since. Next month, I will celebrate my seventh anniversary as the Administrative Director.

Q: How long have you been a volunteer with the MGTA?
A: I began my involvement in the spring of 2010 when Mari McClafferty and I worked on introducing the MGTA scholarship. The proposal was presented to the Board in November of 2010. I also served as the facilitator for a small team-building event for the MGTA’s Board members at my place of work last year.

Q: What have been some of the highlights of your volunteer experience with MGTA?
A: I really enjoyed identifying and filling a need for the MGTA – both as a way to contribute to the development of the MGTA and for my own personal fulfillment. It was my understanding that the possibility of creating a scholarship was something that had been talked about for some time, so working on making it happen was a rewarding experience. I love helping out and making connections along the way and hope to have more of an opportunity to do that in the near future.

Q: What is one of your most interesting trade experiences?
A: The organization I work for provides humanitarian food relief to 60+ countries and there is a lot of work involved in getting our meals from the U.S. to their destinations, so whenever we receive testimonials from food recipients describing the life-saving impact of our meals, it motivates and encourages me.

Q: How has volunteering with the MGTA helped you in your professional development?
A: In my current capacity as Administrative Director, I do not often have the opportunity to get directly involved in international trade issues on a daily basis or as much as I would like to. Volunteering with the MGTA helps me with building a network of professional contacts in international trade and staying up-to-date on relevant topics.

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Country of the Month: Panama

by Kevin Johnson, Best Buy

Geography
Area: 75,517 sq. km. (29,157 sq. mi.); slightly smaller than South Carolina. Panama occupies the southeastern end of the isthmus forming the land bridge between North and South America.
Cities: Capital – Panama City (430,299), Panama District (880,691), Panama Province (1,713,000). Other cities – Colon City (34,655), Colon district (206,553), David City (82,907), David District (144,858). Terrain: Mountainous (highest elevation Cerro Volcan Baru, 3,475 m. [11,468 ft.]); coastline 2,857 km. (1,786 mi.).
Climate: Tropical, with average daily rainfall 28 mm. (1 in.) in winter.

People
Nationality: Noun and adjective – Panamanian(s).
Population (March 2011): 3,405,813. 50.3% of the population lives in Panama province.
Annual population growth rate: 1.84%.
Ethnic groups: Mestizo (mix of African, Indigenous, and European – mostly Spanish – ancestry) 67%, Indigenous 12.3%, African descent 9.2%, Other including Caucasian and Chinese 11.5%.
Religions: Roman Catholic 84%, Protestant 15%, other 1%.
Languages: Spanish (official); various indigenous languages. Many Afro descents from the West Indies speak English and many professional college-educated Panamanians in Panama City are bilingual.
Education: Years compulsory – primary grades 1-6, or through age 15. Attendance – 98.4% for primary school-age children (grades 1-6 or ages 6-11), 73.8% for basic secondary (grades 7-9 or ages 12-14), 44.9% for specialized secondary (grades 10-12 or ages 15-17), 34.9% for tertiary. Literacy – 94.5% overall; much lower literacy in Comarcas Ngobe Bugle 69.2%, Kuna Yala 71.7%, Embera 77.1%.
Health: Infant mortality rate (2009) – 12.2 deaths/1,000 live births, higher in Comarcas Embera 32.1%, Kuna Yala 22.3%, and Ngobe Bugle 19.2% and Bocas del Toro 26.6%. Life expectancy 75.3; 77.6 yrs women, 72.8 men (2007).
Work force: 1.532 million: Commerce (wholesale and retail) – 17.9%; agriculture, cattle, hunting, silviculture – 15.4%; construction – 10.6%; industries (manufacturers) – 8.6%; transportation, storage, postal – 6.5%; private home domestic services – 4.6%; public and defense administration – 6.2%; hotels and restaurants – 5.1%; teaching – 5.8%; social and health services – 3.7%; financial services – 2.0%.
Unemployment (Marzo 2011): 5.6%.
Poverty rate (2008): 32.7%, extreme poverty 14.4%.

Government
Type: Constitutional democracy.
Independence: from Spain, November 28, 1821; separation from Colombia, November 3, 1903.
Constitution: October 11, 1972; amended 1983 and 1994 and reformed in 2004.
Branches: Executive – president (chief of state), vice president. (A second vice presidential slot was abolished starting with the 2009 electoral cycle.) Legislative – National Assembly (unicameral; 71 members, reduced from 78 to 71 members for May 2009 elections). Judicial – Supreme Court.
Subdivisions: Nine provinces and five (indigenous) territories.
Political parties: Panameñista Party (formerly the Arnulfista Party [PA]); Democratic Change (CD); National Liberal Republican Movement (MOLIRENA); Democratic Revolutionary Party (PRD).
Suffrage: Universal at 18.

Economy
GDP (2010 est.): $20.86 billion.
Annual growth rate: 7.5% (2010 est.); 3.2% (2009 prelim.); 10.0% (2008); 12.1% (2007).
Per capita GDP: $5,953 (2010 est.); $5,627 (2009 prelim.); $5,541 (2008); $5,115 (2007); $4,640 (2006).
Natural resources: Timber, copper, gold.
Services (77% of GDP): Finance, insurance, health and medical, transportation, telecommunications, Canal and maritime services, tourism, Colon Free Zone, public administration, and general commerce.
Agriculture, Fishing, Mining (5.7% of GDP, 2010 est.): Products – bananas, corn, sugarcane, rice, coffee, shrimp, timber, vegetables, livestock.
Industry/manufacturing (11.4% of GDP): construction, brewing, cement and other construction materials, sugar milling.
Other: (5.9% of GDP)

Trade (2010): Exports (goods) – $725 million in exports, with salmon/tuna as the largest dollar amount, followed by beef, watermelon, shrimp, and pineapples. Export partners (as a percentage of total export value in 2009) – U.S. 29%, China (P.R.C.) 5.0%, Taiwan 5.0%, Costa Rica 6.8%, Canada 10.5%, Sweden 6.9%, Netherlands 7.0%. Imports (goods) – $9.1 billion was imported in 2010: petrol and fuel oils, capital goods, foodstuffs, chemicals, and consumer and intermediate goods are the leading imports. Import partners (2009) – the top five countries include the U.S. 27.5%, Costa Rica 4.9%, Mexico 4.3%, China 5.4%, and Japan 3.2%. U.S. exports to Panama (2009) – $4.3 billion: primarily oil and capital- and technology-intensive manufactured goods. Panama exports to U.S. (2010) – $211 million: primarily seafood and repaired goods.
Foreign direct investment (2009): $1.8 billion.

Building the Canal
Modern Panamanian history has been shaped by its trans-isthmian canal, which had been a dream since the beginning of Spanish colonization. From 1880 to 1890, a French company under Ferdinand de Lesseps attempted unsuccessfully to construct a sea-level canal on the site of the present Panama Canal. In November 1903, with U.S. encouragement, Panama proclaimed its independence and concluded the Hay/Bunau-Varilla Treaty with the United States.

The treaty granted rights to the United States "as if it were sovereign” in a zone roughly 10 miles wide and 50 miles long. In that zone, the U.S. would build a canal, then administer, fortify, and defend it "in perpetuity.” In 1914, the United States completed the existing 83-kilometer (52 mile) canal, which is one of the world's greatest feats of engineering. The early 1960s saw the beginning of sustained pressure in Panama to renegotiate this treaty.

The Panama Canal Treaties
The 1977 Panama Canal Treaties entered into force on October 1, 1979. They replaced the 1903 Hay/Bunau-Varilla Treaty between the United States and Panama (modified in 1936 and 1955), and all other U.S.-Panama agreements concerning the Panama Canal, which were in force on that date. The treaties comprise a basic treaty governing the operation and defense of the Canal from October 1, 1979 to December 31, 1999 (Panama Canal Treaty) and a treaty guaranteeing the permanent neutrality of the Canal (Neutrality Treaty).

The details of the arrangements for U.S. operation and defense of the Canal under the Panama Canal Treaty are spelled out in separate implementing agreements. The Canal Zone and its government ceased to exist when the treaties entered into force and Panama assumed jurisdiction over Canal Zone territories and functions, a process that was finalized on December 31, 1999.

Source: U.S. Department of State

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Member News

MGTA Board Member and Communications Committee Chair Jason Lloyd and his wife are happy to announce the arrival of Novelle Adelyn Lloyd! She arrived at 10:46 pm, Friday, January 27, weighing 7.7 pounds, and measuring 20 inches long. Congratulations!

 



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Do you know an MGTA member who was recently promoted or hired to an import/export company? Know of a member who recently got married or had a new addition to the family? Share the good news with your industry colleagues by emailing JLloyd@scoular.com.

Who Said it?

"You must have long term goals to keep you from being frustrated by short term failures."
– Charles C. Noble

"I attribute my success to this – I never gave or took any excuse."
– Florance Nightingale

"He who has never learned to obey cannot be a good commander."
– Aristotle

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Thank you, Newsletter Sponsor:

Port of Seattle

2012 Annual Sponsors:

 

Bremer

CH RobinsonDrinker

HMMKing Solutions

Neville Peterson LLPZepol
Global Training Center
Williams Mullen

© 2012 Midwest Global Trade Association. All Rights Reserved.
World Trader is distributed bi-monthly to MGTA members.
Articles submitted by our membership do not express the views of MGTA or the Board of Directors. If you would like to submit an article for publication in the World Trader, please contact the MGTA office at office@mgta.org.

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