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U.S. – EUROPE COMMERCE NEWS
A weekly service provided to the American
Chambers of Commerce in Europe
US & EU ECONOMIC STATS
U.S. CHAMBER ECONOMIC FORECAST FOR SEPTEMBER 2002
Please find attached to this week’s newsletter a copy of the latest
economic forecast from the Chamber’s Chief Economist, Martin Regalia.
According to Mr. Regalia, the sharp decline in U.S. real GDP from 5.0
percent in the first quarter of this year to 1.1 percent in the second
quarter resulted from weaker consumption growth, deteriorating net
exports, and more modest inventory accumulation. While the economic
picture in the second quarter showed a sharp loss of momentum, there was
one important improvement. Investment in equipment software grew at a 3.1
percent annual rate, which is the first positive growth in six quarters.
Mr. Regalia predicts that the U.S. will experience continued slow but
positive growth for this year and some modest acceleration early in 2003.
He forecasts growth of between 2 to 2˝ percent in the second half of this
year and maybe 3˝ percent over the first half of next year.
EUROZONE UNEMPLOYMENT REMAINS STEADY IN JULY
According to statistics released on September 4 by Eurostat, the
European Union statistics office, the eurozone jobless rate remained
steady at 8.3 percent in July 2002, which is 0.3 percent higher than in
July 2001. Unemployment in the 15 member states of the EU was 7.7 percent,
up 0.4 percent from July 2001. Eurostat estimates that there were 13.5
million unemployed in the 15 EU member states during July. Eleven recorded
an increase in the unemployment rate over the past year, with Ireland, the
Netherlands, Luxembourg and Austria reporting the highest increases.
WTO PANEL RULES AGAINST U.S. “BYRD AMENDMENT” LAW
The World Trade Organization (WTO) dispute settlement panel ruled on
September 4 that the United States should repeal its Continued Dumping and
Subsidy Offset Act (CDSOA) of 2000. The ruling was submitted in a
confidential report served to the U.S. and the 11 complainants – the EU,
Japan, South Korea, Indonesia, India, Thailand, Australia, Brazil, Canada,
Mexico and Chile. The CDSOA, known as the “Byrd Amendment,” allowed U.S.
companies to collect over $200 million in anti-dumping and countervailing
duties in 2001. Before the introduction of the Byrd Amendment, the U.S.
Treasury retained the majority of the revenue collected from these duties.
The Bush Administration plans to appeal the ruling.
U.S. CONGRESS RETURNS TO SESSION
he 107th Congress returned to session last week with a huge agenda of
unfinished business. Top business in the Senate included legislation
(HR-5005) that would create a new Department of Homeland Security, which
would bring together 22 federal agencies with 170,000 employees;
appropriations bills (none of the 13 regular appropriations bills for
FY-2003 that starts on Oct. 1 have been signed into law yet); and pension
reform legislation. House-Senate conference committees continued work to
resolve differences on comprehensive energy legislation, election reforms,
terrorism insurance legislation, and patients' rights legislation.
Awaiting final action by both the House and the Senate is the bankruptcy
reform conference report. Also pending is welfare reform legislation.
Congress held a ceremonial session in New York City on Friday, Sept. 6 to
commemorate the Sept. 11 anniversary of last year's terrorist attacks.
Most analysts are predicting a lame duck session of Congress will be
called for after the Nov. 5 elections to finish important legislative
business.
U.S. SENATE FINANCE COMMITTEE DELAYS ACTION ON PROPOSED EXPATRIATE
TAX
On September 5, the Senate Finance Committee adjourned before
completing action to include a provision on a military tax relief bill to
impose a tax penalty against individuals who renounce their U.S.
citizenship in order to avoid paying federal taxes. Under current U.S.
law, expatriates do not pay capital gains tax on sales of assets held at
the time of expatriation for 10 years. The new provision would impose a
tax on assets at the time of expatriation, which is expected to generate
$656 million over 10 years. The version of the bill passed by the House
does not include this new provision proposed by Finance Committee Chair
Max Baucus (D-Montana).
EUROPEAN PARLIAMENT VOTES FOR EU-WIDE SALES OFFERS
On September 5, the European Parliament supported a draft law that
would allow companies to have Europe-wide sales promotions, such as
“two-for-one” offers, though governments would still be allowed to ban
sales below cost for the meantime. The proposal is intended to give
companies in one particular country a range of legitimate marketing tools
to gain a presence in other EU markets, but it has yet to be approved by
EU governments. The market for promotional offers is worth an estimated
€40 billion a year. With the proposal, the Commission seeks to facilitate
efforts to build a single market.
AMCHAM MACEDONIA ACCREDITED BY U.S. CHAMBER OF COMMERCE
The U.S. Chamber of Commerce is pleased to announce the accreditation
of the American Chamber of Commerce in Macedonia. AmCham Macedonia can be
contacted at the following coordinates:
Sharon Valentine
Executive Director
American Chamber of Commerce in Macedonia
Orce Nikolov #93
lok. 2
1000 Skopje
Macedonia
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