Prepared by Megan Smolenyak

  • FEATURE ARTICLE: Focus On Palestine
  • Record-Breaking Sugar Crop Expected in Brazil
  • British Telecom and MCI Create World's First Transatlantic Telephone Company
  • Americans Expect and Receive Better Banking Service than German Customers
  • China's Home Appliance Industry Targets Growth
  • US Ban on Liquor Industry TV and Radio Ads Ends
  • Take the Marketing Insights POLL
  • check back for more news this month!
  • .....check back for more news this month!
  • PALESTINE -- Palestine also known as "West Bank and Gaza" is one of the least understood markets in the world, yet it represents an effective gateway for doing business in the Middle East. In spite of surface appearances to the contrary, it is possible to do business there and there are convincing reasons for doing so. Businesspeople with a desire to source from or sell to the Middle East may be surprised to learn about the opportunities that Palestine offers. This month, PANGAEA.NET features a summary of this report on doing business in Palestine.

    Table of Contents

    May 1995
    June 1995
    July 1995
    August 1995
    September 1995
    October 1995
    November 1995
    Vietnam - special edition
    December 1995
    January 1996
    February 1996
    March 1996
    April 1996
    May 1996
    June 1996
    July 1996
    August 1996
    September 1996
    October 1996
    December 1996/
    January 1997
    February 1997
    March 1997
    April 1997
    May 1997
    June 1997
    July 1997
    August 1997
    September 1997
    October 1997
    November 1997
    December 1997
    January 1998
    February 1998
    March 1998
    April 1998
    May 1998
    June 1998
    July 1998
    August 1998
    September 1998
    October 1998
    November 1998
    December 1998
    January 1999
    February 1999
    March 1999
    April 1999
    May 1999
    June 1999
    July/August 1999

    BRAZIL -- With expectations of a record-breaking sugar crop, Brazil's Finance Minister released the final 1.04 million tonnes of sugar which had been frozen since May, when the sugar export quota had been set at 5.2 million tonnes. Last year, exports reached 5.8 million tonnes and the expectation is that more sugar could be released as the crop progresses this year. Estimates for the 1996-1997 crop are coming in at 270-276 million tonnes. Despite being the biggest source of world sugar, Brazil's heavy domestic use of this commodity usually forces them to import sugar around the Easter holiday. This is the first year that they may be able to satisfy demand and export even larger amounts. Other than the typical uses of sugar, Brazil uses it to produce more than 4 billion gallons of ethanol each year.

    • For information on Brazil's Economic and Political Scene, see Country Updates.

    • Related article on Cuba's sugar production is also available.

    Source: Cynthia Gilbert, Commodities Broker at S.R. Meyers & Assoc.
    USA and UK -- The US$22 billion acquisition of MCI by British Telecom (BT) announced November 3rd, forms the world's first trans-Atlantic telephone company. This is also the largest foreign takeover ever of a US corporation. The effects of this merger, which will operate under the company name of Concert, are expected to be felt throughout the world -- affecting local competition in the USA and international calling rates in Europe. Concert is also planning to increase their presence throughout Asia through alliances with companies in S. Korea, Japan and India. BT already had a 20% stake in MCI as of 1994. This merger presents formidable competition to the US' largest telephone company, AT&T, and presents opportunities for Concert to compete for multinational businesses and dominance throughout Europe when the European Union officially opens their state-controlled telephone monopolies to competition on January 1, 1998. The capital infusion for MCI also presents opportunities for MCI to compete head-on in the US market's US$100 billion residential local telephone service, which is just now opening to competition with the local RBOCs (Regional Bell Operating Companies). This merger is expected to open up the global communications industry, accelerate privatization and global competition, and reduce end-user rates for international calls.
    (Source: YOUR LINK HERE)
    Germany and USA -- According to a recent study conducted jointly by California State University and Fachhochschule Hamburg (Polytechnic University) marketing professors, as part of their fifth German-American Marketing Workshop, findings reveal that American banking customers expect and feel that they receive better banking services than the German respondents. However, in both countries, respondents' expectations were higher than the services received. More specifically, Americans had higher expecations than German customers about innovative services (i.e. banking by phone) and technical support. German customers were significantly more likely to expect competence concerning investment services from their banks; Americans didn't think this was as important because they tend to get investment advice from other sources. The two top rated attributes that Americans felt were important for excellent banking service were: trust and friendliness. The German respondents rated competent investment advice and timely execution of services as the two most important attributes. Despite the differences noted, findings indicate that there was a good deal of similarity between the two customer groups in that both groups rated the same four of five expectations at the top. And both groups agreed that bank size, information by mail and social responsibility were of very little importance.
    (Source: YOUR LINK HERE)
    PR China -- According to WTDB's China Economic Daily News, China's home electrical appliances industry is expected to grow at an annual rate of 15%, with sales reaching 100 billion yuan by the Year 2000. Industry sales in 1995 were 50 billion yuan, up 40% since 1990. Production and consumer acquisition projections to the Year 2000 for selected products are available on the attached CHART.
    (Source: YOUR LINK HERE)

    USA -- On November 7th, the Distilled Spirits Council of the United States (DISCUS) ended the 50-year voluntary ban on television and radio advertising broadcasting for the liquor industry. Liquor products such as vodka, gin, tequila, scotch/whisky have been banned from advertising on radio since 1936 and on television since 1948. However, television and radio ads for the wine and beer industry are allowed, with some restrictions (i.e. cannot show someone actually drinking the product in a commercial). By defying the restrictions earlier this year, the 2nd largest distilled spirits company in the US, Seagram, initiated this reversal -- following the industry's nearly two decades of sharply declining consumption (down 29% since 1980). Seagram ran ads on local stations around the country. Despite the new ruling by DISCUS, the four leading national broadcast networks -- ABC, NBC, CBS and FOX -- have their own policies against running alcoholic beverages commercials and said they had no plans to change them. Moreover, the reversal is not without restrictions (i.e. cannot use cartoon characters that appeal to children in liquor commercials).

    While the alcoholic beverages industry as a whole has experienced general consumption declines for distilled spirits and wine since 1980, the beer industry has demonstrated modest growth of 4.4%. Marketers of beer and wine spent US$682.4 million on television and radio advertising in 1995. The liquor/distilled spirits industry spent US$227.6 million last year to advertise in print and outdoor media.
    (Source: YOUR LINK HERE)

    .....check back for more news this month!

    For more information about any of these topics in any foreign market, or if you would like an in-depth market study, contact PANGAEA, International Consultants. With an extensive network of marketing consultants, attorneys, logistics experts and more around the world, PANGAEA is uniquely qualified to offer hands-on, local marketing and management consulting services.

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    Updated 11/8/96