Category Archives: England

The Customer Wants Wine

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A quick one for you to ponder over the weekend. The U.S. Census Bureau, whose publications are normally a good cure for insomnia, put up a nifty chart that shows U.S. wine exports from 2002 through 2011. Not only is the world getting thirstier for American wine, but it is drinkers in the United Kingdom and Canada that are driving the surge. The Brits were the prime imbibers through 2008, when their binge ended in the recession. But our neighbors to the north have more than picked up the slack.

Chug-a-lug.

Chug-a-lug.

The rest of Census’ blog post addresses things you need to know if you want to get into the wine trade. Lacking my own vineyard, maybe I’ll just open a nice red tonight.

Arms Trade

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My last arms deal was in 2000 when Austria bought nine Sikorsky Blackhawks. Their prime mission was search and rescue, so I’m not sure it should count. Many U.S. commercial officers are ambivalent about the arms trade, and political appointees periodically frowned on our involvement, but I always felt that the customer was going to buy from somebody, so it might as well be us.

An analysis of global arms trade was published recently by the Stockholm International Peace Research Institute (SIPRI), taking a searching look at arms flows from 2007 through 2011. SIPRI stresses its independent analysis, but bear in mind that it gets a lot of its funding from the Swedish government. That said, despite Sweden’s role as a military equipment supplier, I have no reason to doubt SIPRI’s data or analysis. You can get the complete report here.

The major countries selling military gear and weapons don’t change all that much, so it is no surprise that SIPRI’s Top 5 arms suppliers are, in order, the United States, Russia, Germany, France and the United Kingdom. The United States sold 30% of the world’s arms in 2007-2011 and the Russians dealt 24%. The Top 5 together controlled 75% of the business. That, however, means that other players are growing because the Top 5 controlled 78% during 2002-2006. Here’s who the Top 5 are selling to:

Major arms sellers & their customers

What is extraordinary, and a big change over the years, is that the Top 5 arms buyers are all in Asia: India, South Korea, Pakistan, China and Singapore. India has an aging war machine and is replacing much of it, plus they have little domestic arms manufacturing capability. South Korea faces problems to the north, and Pakistan is nervous about India and Afghanistan, and has problems of its own. China is moving down the buyers list, swiftly becoming an arms exporter itself. Singapore, given its size, was a surprise to me, but they appear to be going very high tech in their purchases.

Major arms buyers & their suppliers

The biggest arms deal of 2011 – and the biggest in decades – was Saudi Arabia’s decision to buy or renew 154 F-15 fighters from the United States

London Eyes a Distant Recovery

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London – My first impression was that London is coming out of the recession in good shape.  When we checked into our hotel in Bayswater, the desk clerk commented that the hotel was full and the shopping streets of Bayswater were teeming with people. The restaurants were full and the shops seemed to be doing business.

Stormcluds Over the Eye

Stormcluds Over the Eye

But first impressions are not always accurate.  Bayswater is now a neighborhood of immigrants and transients, which explains the busy restaurants.  And my hotel had a particularly good offer.  As I spoke to friends in the city and paid attention to the news broadcasts, quite another picture emerged.  Real estate prices that seemed atrocious to me (that takes some doing if you live in high-cost Honolulu) were down 20% or more from their highs.  A local news show visited an industrial park where 20% of the factory space was vacant, and the more we looked, the more retail space we saw with “For Lease” signs on them.  Another news story averred that London has a quarter of a million people suffering from depression brought on by financial setbacks.  I mentioned all this to a friend who is involved with Europe-wide project finance, and he said his bank’s economists aren’t expecting things to really improve in England or Europe as a whole until 2012.  That’s a long time to wait and certainly at odds with all the ‘green shoots’ that the politicians claim to be seeing.