Washington, 10 October 1996 (RFE/RL) -- Headlines and news bulletins greeted the U.S. Commerce Department's announcement recently that the United States had suffered a record $17.5 billion merchandise trade deficit in July.
But this huge difference between the amount of goods the United States imported and the amount it exported to the rest of the world was partly a result of a statistical oddity in the way the information is calculated, and a result of the Olympics.
Aircraft are a major U.S. export, but it seems that while the United States counts the sale of commercial aircraft as merchandise, it counts the sale of military aircraft as a service.
So while the United States sold over $1 billion worth of military aircraft to Saudia Arabia, Switzerland, Finland and the United Arab Emirates in July, the trade figures reflected none. Making matters worse, one of America's largest aircraft makers, Boeing, was slightly delayed in shipping 11 large planes to foreign customers, so the aircraft export column in the trade figures -- normally very large -- was minute. That made the deficit soar.
The head of the Commerce Department's balance of payments office says that for a variety of arcane reasons, it was decided long ago to count military planes as services, not goods.
One Commerce Department official said to wait for the August figures, since this is when Boeing shipped the 11 planes. That should put the month's aircraft export figure at close to $2 billion. A miraculous recovery.
In the figures for trade in services, the United States showed a deficit in July because of the Oympics. Yes, the Olympics were held within the United States, which brought lots of money into the country. But July was when the U.S. broadcasting company NBC made its $456 million payment to the International Olympic Committee for its television coverage of the games.
Czech Republic: U.S. Diaper Maker Buys Into Firm
The U.S. consumer products giant Kimberly-Clark says it has agreed to acquire the leading disposable diaper maker in the Czech Republic, Zisoft-Bobi AS. The firm, while small, is considered a strategic aquisition by the Dallas, Texas-based company to complement its Inova brand feminine care business. It will make Kimberly the largest personal-care products manufacturer in the Czech Republic, according to the "Wall Street Journal."
Zisoft's low-cost Bobi brand of disposable diapers currently accounts for 40 percent of the $30 million yearly market in the Czech Republic. The market has grown 45 percent in the last three years, says John Van Steenberg, head of Kimberly's European operations. Kimberly sells the Huggies brand of disposable baby diapers.
Hungary: Canadian Developer Teams Up For Real Estate Ventures
A Toronto, Canada-based real estate developer, Trizec Corporation, has formed a joint venture with the Budapest, Hungary developer Polus Investments Ltd. to build shopping centers, business parks and mixed-use office buildings across Central Europe, starting in Slovakia.
A spokeswoman for Trizec told the "Toronto Globe and Mail" that the venture will combine "Trizec's real estate expertise and Polus' local connections." Polus is controlled by Sandor Demjan, identified as one of Hungary's wealthiest businessmen.
The joint venture is examining three potential developments in Budapest and one in Bratislava.
The two companies have worked together before. Trizec served as a consultant to Polus in the development of Polus Center, Hungary's first modern shopping mall. The $70 million facility is to open in November.
United States: Ted Turner to Son-- 'Your Job is Toast!'
The stockholders of Turner Broadcasting company and Time Warner corporation are finalizing the $7.7 billion merger of the two firms this week, making it the largest and most powerful media giant in the United States.
Ted Turner, the entrepreneur who founded and built Turner Broadcasting from his CNN cable television news network, becomes vice chairman of the new corporation. He and Time Warner Chairman Gerald Levin say the company will eliminate about 1,000 employees as the two companies combine their operations.
One of the first to go, however, comes as a complete surprise to just about everyone -- it's Turner's son Robert. Known as Teddy, the 33 year old is promotions manager for the Turner company's home-video unit.
Family members told the "Wall Street Journal" that at a family dinner this summer in Atlanta, Teddy mentioned to his father that rumors were flooding the firm that the merger would mean a large scale loss of jobs at Turner.
"I was concerned," said Teddy, "but I figured we were fairly safe, so I asked, 'What do you think?' It was a natural question."
The "Journal" said Turner's reply was: "You're toast."
At first, Teddy said his siblings thought their father was kidding, but he knew different. "I realized he wouldn't joke about something like that."
His father gave him the speech familiar to the thousands of workers put out of work by corporate cutbacks -- "it's good for the company and it's good for you, (although) in the short run it's always a little painful." Time Warner has a larger and better established home video unit, so the Turner division is being abolished.
Teddy's wife, Leslie, made it through the family dinner with her job at Turner Cartoon Network intact, as did his sister, Jennie Garlington, who works for a Turner Cable environmental show unit.
Teddy says that since he used up a trust fund his father had given him several years ago, he does have to work to make a living. He says he's going to start a company of his own.
But after the dinner, Teddy said his father felt guilty and told him that if worse comes to worse, he'll get him a job.