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Spotlight on Brazil: Investment Ties Our Economies and Communities Together

July 1, 2015

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Vinai Thummalapally is the Executive Director of SelectUSA.

Graph showing the growth in Brazilian assets in the United States, from $29.2 billion in 2007 to $93.6 billion in 2012. Source: Brazil-US Investments Map by Apex-Brasil.

Graph showing the growth in Brazilian assets in the United States, from $29.2 billion in 2007 to $93.6 billion in 2012. Source: Brazil-US Investments Map by Apex-Brasil.

With Brazil President Dilma Rousseff visiting the United States this week, the U.S.-Brazil relationship is front and center on the national stage. Last week, I spoke at the launch of the Brazil-U.S. Investments Map [PDF], a new report highlighting Brazilian foreign direct investment in the United States. The report was produced by the Brazilian Trade and Investment Promotion Agency (Apex-Brasil), the Brazil Industries Coalition, and the National Confederation of Industry of Brazil.

According to the report, the value of Brazilian majority-owned total assets in the United States grew by 221 percent between 2007 and 2012 to $93.6 billion (see graph). The value of U.S. majority-owned total assets in Brazil has also grown during the same period to $283 billion, and represents 53 percent of all U.S. majority-owned assets in South America. This growth in bilateral investment supports many jobs for U.S. and Brazilian workers. As of 2012, U.S. subsidiaries of Brazilian firms employ more than 76,100 workers in the United States according to the Bureau of Economic Analysis.

During the launch event’s panel discussion , I enjoyed hearing from Antonio Moreira, CEO of North American operations for the global IT company Stefanini. Headquartered in Sao Paulo, Stefanini has invested in seven U.S. states during the last 15 years and employs more than 2,000 associates in the United States. According to Moreira, the key to Stefanini’s success has been preserving the company’s culture and values while respecting each community’s local culture and way of doing business.

SelectUSA Executive Director Vinai Thummalapally (third from right) participates in a panel discussion hosted by CSIS Americas for the launch of a new report on U.S-Brazil bilateral investment flows.

SelectUSA Executive Director Vinai Thummalapally (third from right) participates in a panel discussion hosted by CSIS Americas for the launch of a new report on U.S-Brazil bilateral investment flows.

Knowledge-intensive industries such as IT services are critical to U.S.-Brazil bilateral investment—the aerospace sector is another great example. Brazil-based Embraer, the world’s third-largest aircraft manufacturer, has facilities in four U.S. states and a large number of local parts and equipment suppliers in the United States. This highly innovative sector represents a tremendous opportunity for investors, and I hope to see a strong delegation of Brazilian companies at the National Aerospace FDI Exposition in Los Angeles, on October 26-28, 2015.

Across all industries, the U.S. Commercial Service is working closely with local associations in Brazil through the SelectUSA program to support cross-border projects by Brazilian companies looking to start or expand operations in the U.S. market. Here at home, our team of investment experts can help U.S. states, cities, and regions attract Brazilian investors to their communities.

Both international companies and U.S. economic development organizations (EDOs) can take advantage of SelectUSA’s free services to get market-specific information and counseling. I invite all U.S. EDOs to consider signing up for our SelectUSA Road Show to Brazil on December 1-4, 2015, where they will meet directly with investors in three cities. Stay tuned for a webinar in mid-July with more details, and you can contact Investment Specialist Andre Leal with any questions in the meantime.

The future is bright for the U.S.-Brazil economic relationship, and I look forward to welcoming many more Brazilian companies to our communities in the years to come.

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Helping Middle Market Companies Increase Overseas Revenue: ITA’s new partnership with American Express

June 30, 2015

This post contains external links. Please review our external linking policy.

Jillian Doody is the International Trade Administration’s Director of Strategic Partnerships.  

Assistant Secretary of Commerce for Industry and Analysis Marcus Jadotte (right) and American Express Vice President of Business Development for Middle Market Southeast Franki Lupo Schmidt announce partnership to help increase trade education and awareness of export opportunities for U.S. businesses.

Assistant Secretary of Commerce for Industry and Analysis Marcus Jadotte (right) and American Express Vice President of Business Development for Middle Market Southeast Franki Lupo Schmidt announce partnership to help increase trade education and awareness of export opportunities for U.S. businesses.

Earlier today, Assistant Secretary Jadotte joined American Express Vice President of Business Development for Middle Market Southeast Franki Lupo Schmidt to announce a new partnership to help increase trade education and awareness of export opportunities for U.S. businesses. During the ceremony in Atlanta, Jadotte and Schmidt signed a memorandum of agreement (MOA) between the U.S. Department of Commerce’s International Trade Administration (ITA) and American Express (AmEx).

The joint effort will focus on small- and medium-sized enterprises (SMEs) and AmEx’s Grow Global program which targets middle market businesses – those generating between $10 million and $1 billion in revenues annually.

The MOA was signed during AmEx’s Grow Global kick-off event. During the kick-off, businesses heard from top industry experts and met one-on-one with agents, distributors, government and industry officials, and other business leaders who are already successfully exporting their goods and services to markets around the world.

Last month, American Express announced the launch of Grow Global at ITA’s Discover Global Markets event in Miami. AmEx’s program is designed for companies that are considering exporting as a growth opportunity, as well as business that are currently expanding their business into markets outside the United States with the goal of increasing goods and services exports to international markets.

As a part of our partnership, ITA and AmEx will work together to increase awareness of the economic benefits of trade; educate U.S. business about exporting as a job creation and growth strategy; generate awareness of ITA and U.S. government resources; and encourage businesses to seek ITA assistance.

With 96 percent of the potential consumers for U.S. goods and services living outside of the United States, ITA has a critical role in helping U.S. companies be more competitive in the global marketplace. In 2013, 59 percent of all small and medium-sized exporters posted sales to only one foreign market. Increasing the number of markets, even by a small percentage, could have a big impact on the U.S. economy, and create more jobs in communities across the country.

One way ITA helps increase the number of markets our clients export to is by partnering with companies like American Express. Our Strategic Partnership Program leverages partnerships with trade associations, private corporations, chambers of commerce, and state and local governments to broaden and deepen the U.S. exporter base. Through these innovative public-private partnerships, the U.S. Department of Commerce communicates with millions of U.S. businesses about global business and export opportunities.

 

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ASEAN Information is Now Easier to Find on Export.gov

June 30, 2015

Andrew Edlefsen is the Director of the Las Vegas U.S. Export Assistance Center and currently serves as Global Asia Team Leader.  He has been with ITA for eight years.

Screenshot of Export.gov/ASEAN

Screenshot of Export.gov/ASEAN

I’m very excited to announce the launch of the new, ASEAN website as part of Export.gov. Developed by the U.S. Commercial Service in Bangkok, the site highlights trade opportunities in the 10 ASEAN countries: Brunei Darussalam, Burma, Cambodia, Indonesia, Lao PDR, Malaysia, Philippines, Singapore, Thailand, and Vietnam. The site serves as a valuable resource for U.S. companies exploring business opportunities in the region.

Located in the heart of the Asia-Pacific region, the ASEAN countries are composed of vastly different markets and economies, each possessing their own unique challenges, but all of which hold huge potential for U.S. exporters in a myriad of industry sectors.  Highly notable is the region’s 626 million population and $2.4 trillion economy, which has grown 300 percent since 2001, making it the second fastest growing Asian economy after China.  A proven U.S. export destination, ASEAN countries, taken together, rank 4th after Canada, Mexico and China as a goods export market for the United States, and the United States is the third largest trading partner for ASEAN.  In 2013, U.S. exports to the ASEAN countries ($79 billion) accounted for 5 percent of overall U.S. exports while U.S. goods and services exports to ASEAN supported an estimated 499,000 jobs (365,000 from goods exports and 134,000 from services exports).

The top ASEAN export markets for U.S. originating goods in 2014 were Singapore ($30.5 billion), Malaysia ($13.1 billion), Thailand ($11.8 billion), Philippines ($8.5 billion), Indonesia ($8.3 billion) and Vietnam ($5.7 billion) with the top export prospects including aerospace, energy, infrastructure, medical equipment, environmental technologies, and franchising.

ASEAN is moving toward economic integration, with the goal of creating an ASEAN Economic Community (AEC) by the end of 2015. The AEC will build on the existing ASEAN Free Trade Area (AFTA) to establish a single market and production base that allows for the free movement of goods, services, and skilled labor. It will also allow for a more open flow of capital and investment, thus increasing its appeal as one of the world’s most attractive consumer markets.

The U.S. and Foreign Commercial Service has a strong presence in the ASEAN region, with offices in Burma, Indonesia, Malaysia, Philippines, Singapore, Thailand, and Vietnam, which provide direct counseling and assistance to U.S. companies doing business in these markets.  The ASEAN Commercial Service office, headed by Regional Senior Commercial Officer Margaret Hanson-Muse, is located in Singapore.

Be sure to visit www.export.gov/asean and take advantage of this amazing resource!

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American Competitiveness and the Global Race for Export Success

June 30, 2015

This post originally appeared on the Department of Commerce blog.

Post by Fred P Hochberg, Chairman and President, Export-Import Bank of the United States.

Photo of Fred Hochberg and two unidentified men in hard hats, safety vests and ties.

American Competitiveness and the Global Race for Export Success

This week, I had the opportunity to participate in Foreign Policy’s inaugural summit on American competitiveness, an event that brought together leaders from the worlds of business, security, and government to discuss a range of issues related to America’s capacity to thrive in today’s challenging global climate.  David Rothkopf and the Foreign Policy team put together a vibrant and informative event, which included conversations with Secretary of Commerce Penny Pritzker, U.S. Trade Representative Michael Froman, Financial Services Roundtable CEO and former Governor Tim Pawlenty, and a host of economists, CEOs, and global policy experts.

In a speech closing the event, I took the opportunity to focus on one critical element of American competitiveness—one that is very much at risk today: the global race for export success.

EXIM Bank, which equips American businesses with the financing necessary to compete for export sales when the private sector is unable or unwilling to do so, will see its Charter lapse next Wednesday for the first time in its 81-year history.  After 16 bipartisan reauthorizations, the support of 13 consecutive U.S. presidents, and a sterling record of service to the American people—including supporting 164,000 U.S. jobs last year while generating a $675 million surplus for taxpayers—it’s hard to believe that EXIM would be allowed to lapse.  That’s particularly true when clear majorities in both the Senate and the House of Representatives have expressed support for EXIM’s reauthorization; in this day and age, that sort of consensus doesn’t happen very often.

For the last few months, I’ve been asked over and over again: what’s going to happen on July 1st if you aren’t reauthorized?  But frankly, I don’t think that’s the right question to be asking.  Because the damage caused by the debate over EXIM has already cost real Americans their jobs, and harmed long-term U.S. global leadership—and we’ll be feeling the consequences for years to come.

General Electric, one of the largest employers in America, does a lot of exporting without EXIM—but they count on the Bank to handle the deals that private financiers can’t.  A few weeks ago, we learned that GE is at risk for losing out on a major locomotive project in Angola.  This deal was expected to generate 1,800 U.S. jobs across 12 states, but because of the uncertainty surrounding EXIM, the deal is at risk—and China has agreed to step in with state-sponsored financing for their state-owned locomotive manufacturer.

That’s 1,800 American families that won’t be able to count on a dependable paycheck—1,800 jobs that should be going to folks in Pennsylvania, Texas, and Illinois that are instead going to end up in China, all because a vocal minority wants to put ideology ahead of American workers.

Of course, even though GE families are already being hurt by this, most of the pain will be reserved for small businesses that historically find it difficult to obtain export financing in the commercial sector.  On Monday, I went to Delaware to meet with one of them, a small, family-owned company called Acrow.  They manufacture modular steel bridge kits—a core product for developing countries that want to build a reliable infrastructure.

EXIM is guaranteeing a $73 million commercial loan that will empower Acrow to sell 144 bridges to Zambia.  This project will support 200 good-paying jobs at Acrow’s manufacturing facilities in Pennsylvania and Delaware, as well as at their suppliers across ten states.  It was only possible because they had access to financing that let them compete and win against their Chinese and European rivals.  Without EXIM guaranteeing the loan, no private bank was ready to finance a sale like this to Zambia.  That’s just not something that commercial banks do anymore—that’s the exact gap that EXIM was designed to fill.

Buyers in Zambia and around the world want to buy American—they want to buy the best.  But if EXIM isn’t around, they won’t always have that option.  U.S. businesses deserve better than to be cut off from critical tools that empower them to succeed in global markets.  After all, they’re already facing an alarmingly competitive world out there.

In my time as Chairman of EXIM, I’ve met a whole lot of entrepreneurs and workers across America—and I’ve never come across one who wanted a handout.  All they want is a level playing field.

When U.S. exporters go into global markets armed with financing from EXIM, they have an opportunity to compete on their merits.  When they do, they usually win.  And that means more jobs for U.S. workers, and a more competitive American economy.  We owe it to them to break down barriers to export success—not to tie their hands.

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Exports Take Flight at the 2015 Paris Air Show

June 22, 2015

This post originally appeared on the Department of Commerce blog.

Post by Marcus D Jadotte

Assistant Secretary of Commerce for Industry & Analysis Marcus Jadotte, Secretary of the Air Force Deborah James, U.S. Ambassador to France Jane Hartley, Senators Shelby and Cochran, and many other distinguished visitors join Tom Kallman, President and CEO of Kallman Worldwide, with the ribbon cutting ceremony that opened the U.S. International Pavilion at the 2015 Paris Air Show

Assistant Secretary of Commerce for Industry & Analysis Marcus Jadotte, Secretary of the Air Force Deborah James, U.S. Ambassador to France Jane Hartley, Senators Shelby and Cochran, and many other distinguished visitors join Tom Kallman, President and CEO of Kallman Worldwide, with the ribbon cutting ceremony that opened the U.S. International Pavilion at the 2015 Paris Air Show

Last week, I was honored to represent the Department of Commerce at the 51st International Paris Air Show. The Paris Air Show is the largest in the world, attracting participation from high-level government officials from across the globe, and CEOs from major U.S. and foreign aerospace companies. Every two years, the air show in Paris is the best place to see the latest technologies in the aerospace industry and to meet potential business partners from around the world.

This year, the United States had the largest international pavilion at the show with 200 U.S. companies participating. The breadth and depth of technology on display made it obvious why each year the aerospace industry has the largest trade surplus of any manufacturing industry. In 2014, U.S. aerospace companies exported more than $138.4 billion worth of equipment to markets around the world, supporting more than 500,000 jobs across the country.

At the air show, U.S. companies had the opportunity to meet with representatives from more than 2,200 companies from around the world. The International Trade Administration (ITA) has worked with pavilion organizer Kallman Worldwide for more than 15 years to help U.S. exhibitors get the most out of the show. From June 15-18, industry experts and commercial specialists from ITA’s domestic and international teams were on hand in Paris to counsel companies and help them make connections well beyond Le Bourget Airfield. In the weeks leading up to the show, we conducted webinars for companies to help prepare them to maximize their participation in this year’s air show. Webinar topics included export controls, export financing, EU customs regulations, and air show logistics.

ITA was pleased to partner with our colleagues from the Departments of Defense and State to coordinate efforts to increase aerospace defense exports at this year’s air show. Working in concert with our partners improves our ability to facilitate success for U.S. companies, and helps to improve national security.

During the air show, I met with many government and company representatives to discuss their future plans and business goals. More and more, companies are realizing that success in the aerospace industry requires having a thoughtful plan for targeting opportunities beyond U.S. borders. In fact, the highest growth markets for aviation are outside North America, and with that growth comes additional business. Companies, and their governments, need to be prepared to navigate the accompanying challenges with expanded growth and increased business. I’m proud to say that ITA stands ready and able to help U.S. companies plan their export strategy, answer questions and address challenges head-on.

While in Paris, we had the opportunity to promote our upcoming National Aerospace FDI Exhibition. The event, which takes place in Los Angeles from October 26-28, will showcase the prowess of the American aerospace industry and highlight the many opportunities for investors. Our partner for this event is the Aerospace States Association, which brings together the combined efforts of U.S. state governments. We anticipate that this forum will create new business opportunities and new jobs in communities across the country. We look forward to seeing everyone in Los Angeles!

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U.S. Goods Exported to Trade Agreement Partners Supported 3.2 Million Jobs in 2014

June 18, 2015

This post originally appeared on the Department of Commerce blog.

Today, Secretary Pritzker and the Commerce Department released a report showcasing that in 2014, nearly 3.2 million jobs—44 percent of all jobs supported by goods exports—were supported by the export of goods to our Free Trade Agreement (FTA) partners.

In 2014, the United States reached record levels in goods and services exports for the fifth consecutive year totaling $2.34 trillion. Since 2009, goods exports to our current FTA partners grew 64 percent versus 45 percent to the rest of the world. The United States continues to have a trade surplus in manufactured goods, $56 billion in 2014, with the countries in which we have trade agreements.

This report highlights the importance of trade agreements in supporting the U.S. economy and American jobs. Ninety-five percent of the world’s consumers live outside of our borders and the demand from overseas middle-class markets will continue to grow. The Asia-Pacific region  is expected to be home to 3.2 billion middle-class consumers by 2030. American businesses want to sell more products internationally and foreign citizens want more access to U.S. products and services.

In 2014, nearly 3.1 million jobs, or 43 percent of all jobs supported by goods exports, were the result of goods exports to the countries engaged in the current Trans-Pacific Partnership (TPP) negotiations. While Canada and Mexico represent the largest portion of U.S. jobs supported by exports among TPP member countries, goods exports to the five new potential FTA partners in the Asia-Pacific—Brunei, Japan, Malaysia, New Zealand, and Vietnam—supported nearly 460,000 jobs in 2014.

Passage of fair trade legislation, such as Trade Promotion Authority and the TPP, is a critical step toward enabling our country to negotiate modern trade agreements in the Asia-Pacific and Europe that reflect our values, open up new markets, level the playing field for our businesses and workers, and support more high-paying American jobs.

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Explore Brazil’s Education and Travel & Tourism Sectors – Top Prospects for U.S Exporters

June 18, 2015

Tom Hanson is a Commercial Officer for Commercial Service Brazil, posted in São Paulo.

Commercial Service (CS) Brazil wants to spread the word that Education and Travel & Tourism rank among its highest-yielding “Best Prospect Sectors” for U.S. exporters.  Educational institutions of all sizes and specialties, as well as destinations and tour operators enjoy year-upon-year growth for these consumer-based services.

According the Institute of International Education’s 2013/14 report, Brazilians now make up 1.5 percent of the foreign student population in the United States, on par with students from Mexico and Japan (respectively, 1.7 and 2.2 percent). Presidents Obama and Rousseff place a high priority on educational exchanges in Science, Technology, Math and Engineering, and English-language teaching programs.  In 2014, CS Brazil promoted services of dozens of U.S. colleges, universities, and vocational schools, who arrive in Brazil on a regular basis to attract students and motivate local recruiters.

One of Commercial Service’s largest trade promotional programs,VisitUSA, wrapped up its three-city tour to Rio de Janeiro, São Paulo, and Campinas, wherein tour operators met one-on-one with more than 70 U.S. destinations. Meanwhile, Brazilian tourists arrive in the United States in ever-growing numbers. In 2014, more than 2 million visited the United States, spending more than $12 billion collectively. Our two countries have a bilateral agreement to issue travel visas that are valid for 10 years; Consulate São Paulo alone issued more than 572,000 visas in 2014.

Brazil has a large and diversified economy that offers U.S. companies many opportunities to partner and to export their goods and services, and U.S. exports are increasing rapidly. Doing business in Brazil requires intimate knowledge of the local environment, including both the direct as well as the indirect costs of doing business in Brazil (referred to as “Custo Brasil”). Such costs may include government procedures and a complex tax structure.

The team at CS Brazil is standing by to guide U.S. exporters on uncovering new markets in these high-profile Service Exports sectors. For more information, please review CS Brazil’s Country Commercial Guide.

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