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New Strategic Partnership with Thunderbird School of Global Management

August 25, 2016

Yuki Fujiyama, a trade finance specialist in the Office of Finance and Insurance Industries and the author of the Trade Finance Guide: A Quick Reference for U.S. Exporters, currently serves as the Global Finance Team Leader.  Kristian Richardson, the Executive Secretary of the Arizona District Export Council, currently serves as the Director of the U.S. Commercial Service in Arizona.

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The International Trade Administration (ITA), the U.S. government’s lead export promotion agency, and Thunderbird School of Global Management, one of the world’s top-ranked international business schools and a unit of Arizona State University, recently signed a strategic partnership agreement to support U.S. exports and international trade through a unique collaboration in global business education, especially in the area of finance.

signing

Deputy Assistant Secretary of Commerce for U.S. Operations Antwaun Griffin (front right) and Thunderbird CEO and Director General Allen Morrison (front left) sign a strategic partnership agreement.

This agreement was made possible through ITA’s Strategic Partnership Program, which enables and enhances mutually beneficial collaboration between ITA and a partner organization in support of the growth of U.S. exports and the advancement of international trade.

Founded in 1946 in Glendale, Arizona, Thunderbird is the oldest and largest graduate school for international business in the United States.  Thunderbird is consistently ranked among the best in the world in international business education and among the top 20 worldwide in executive education.

school

The main entrance at the Thunderbird School of Global Management in Glendale, Arizona

This agreement will help advance ITA’s strategic priorities while supporting Thunderbird’s global business education programs. For example, under this agreement, both Thunderbird and ITA will work together to encourage more U.S. exporters to take courses in global finance, international credit, and trade finance in the school’s Executive Education programs. Such an effort will help expand access to finance for U.S. exporters, one of the Administration’s strategic priorities under the National Export Initiative/NEXT.  In addition, Thunderbird will help support ITA employees’ professional development needs, which will enhance the agency’s ability to assist the U.S. business community in reaching global markets.

In return, this agreement will make it easier for Thunderbird to utilize resources available through a network of ITA’s U.S. Commercial Service trade specialists and commercial diplomats located in over 75 countries and 100 U.S. locations for academic and research activities.  For example, under this agreement, ITA will help recruit guest speakers for Thunderbird’s Executive Education programs from its internal talent pool as well as experts from other U.S. government trade promotion agencies and private-sector strategic partner organizations.

“Nothing pleases us more than the opportunity to develop a partnership with business and government clients who can benefit from Thunderbird’s extensive experience in management and global leadership education,” said Dr. Allen Morrison, CEO and Director General of Thunderbird School of Global Management. “Our mission is to help working professionals and those in search of higher education opportunities develop the skills they need to be more successful in their careers and in advancing the organizations for whom they work.”

“Many U.S. businesses, particularly small and medium-sized firms, have yet to export because they often believe exporting to be too burdensome or may not be fully unaware of export services from the federal government and its partners. By focusing on global business education, this partnership represents another step in helping U.S. businesses pursue opportunities with the 95 percent of world consumers who live outside of the United States,” said Antwaun Griffin, U.S. Commerce Deputy Assistant Secretary for U.S. Operations.  “In addition, I am particularly pleased that this agreement will help support cross-training on programs and activities for ITA and Thunderbird employees.”

 

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Cutting-Edge Tech at Hannover Messe Equals Win-Win for U.S. Small Business and the Planet

August 24, 2016

Joshua Kaplan is an International Trade Specialist at the U.S. Commercial Service Office in Richmond, Virginia.

One important aspect about U.S. companies going global is that they aren’t just looking for profits. In my work, I’ve seen broad commitment from global companies to make positive impact in the markets in which they sell. That definitely adds a sense of reward for me; as I help companies grow through global sales, I see these companies making a positive impact in the world.

Among the 400-plus exhibitors that joined the U.S. Partner Country delegation at Hannover Messe in April was a company called Filtroil, a small business in my city of Richmond, Virginia. Filtroil produces advanced filtration systems for industrial fluids, extending the life of machinery and reducing the amount of potentially harmful waste produced by manufacturers.

Filtration systems can help industrial companies increase productivity and decrease cost, and minimize environmental impact. That’s a major benefit for manufacturers, and the attendees at Hannover Messe took notice of Filtroil’s solutions.  Even before the show began, our Commercial Service team gathered more than 20 prospective leads for the company, and set up meetings between Filtroil CEO Jeremy Leahman and several qualified prospective buyers.

During the week of the show, Jeremy often had a line at his booth, as the thousands of Hannover Messe attendees passed through our U.S. Pavilions and saw innovative U.S. companies like Filtroil.

Just six weeks after the show, Filtroil has already secured enough new global business that the firm has hired additional staff to capitalize on these new opportunities.

That’s an excellent result from a trade show and a great benefit for a small company. It’s also great news for the environment, because both developed and developing economies are looking to improve productivity to meet increased global demand, and innovative products like Filtroil’s will help them do that without a commensurate increase in environmental impact.

It’s one small example of what I believe to be a unique trait of U.S. companies – we don’t just send products to a market and leave with the profits. American companies create solutions that help the world’s producers be more efficient and environmentally-friendly. I’m glad that companies like Filtroil joined our Hannover Messe delegation to show the world how U.S. innovation keeps the world green.

For any U.S. company looking to make a global impact, I encourage you to contact your nearest Commercial Service office and let us help you find your next international market.

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Trade Winds: A Special Opportunity for U.S. and Latin American Business

August 24, 2016

Arun M. Kumar is the Assistant Secretary for Global Markets and Director General of the U.S. and Foreign Commercial Service.

The U.S. Commercial Service will head to Latin America in September with about 100 U.S. companies and organizations, to cultivate trade and investment deals between the United States and some of our key regional partners.

Meeting

Trade Winds visited Africa in 2015, bringing 108 U.S. companies and facilitating 650 business-to-business meetings. It was the largest-ever U.S. government-led trade mission to Africa.

The Trade Winds trade mission and business forum is one of our flagship events in the Commercial Service. Trade Winds has taken  more than 800 U.S. companies and organizations to six global regions in the last nine years, facilitating more than $239 million in business deals, with the majority of our attendees being small to medium-sized enterprises.

This year’s Trade Winds will be an incredible opportunity for attendees to make new contacts, connect to prospective partners, and capitalize on promising opportunities in seven Latin American markets: Argentina, Bolivia, Chile, Mexico, Paraguay, Peru, and Uruguay.  As impressive as Trade Winds is, it is only one element of our agency’s commitment to deepening our trade and investment partnerships in the region.

The Department of Commerce began this commitment in 2014 when Secretary Penny Pritzker announced the Look South campaign to help U.S. companies learn about and take advantage of promising opportunities in the Western Hemisphere.

That commitment continued through our work to ensure that U.S. exporters reap the benefits from regional trade agreements. The United States has more trade agreements with Western Hemisphere partners than with any other region in the world. Partly because of our work to drive results from our trade agreements, nearly half of U.S. exports are sold in this part of the world.

The next step is the Trans-Pacific Partnership (TPP). This 21st-century trade agreement will reduce and eliminate trade barriers with 11 leading global economies – three of which will be a part of Trade Winds: Chile, Mexico, and Peru. TPP will decrease the cost of doing business for U.S. firms, and Trade Winds participants will get a first glimpse of how the connections we make at Trade Winds can become even more fruitful once TPP becomes a reality.

I want to thank our Commercial Service staff and our partners at Embassies across the region, who have worked tirelessly over the last few months to create an incredible program.

I would also like to thank the members of our delegation, and extend a special thank you to our Official Sponsors for making Trade Winds possible.

We hope you will follow updates from Trade Winds on Twitter using #TradeWinds16, and you will see what an excellent experience this is for U.S. companies and economic development teams.

 

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Life in the Foreign Commercial Service

August 17, 2016

Eric Olson is an Officer in the International Trade Administration’s U.S. & Foreign Commercial Service

Life in the Foreign Commercial Service (FCS) reminds me of the title of one of my favorite books as a child, Dr. Seuss’s, Oh, the Places You’ll Go. Every time I begin the process of bidding on my next assignment, the world is my oyster. I start imagining myself living in India or South Africa or Chile – the sights, the smells, the foods, the commercial climate, the vacation possibilities. As I’m approaching bidding season soon, it’s fun to reminisce about some highlights from my prior postings:

  • Seoul, South Korea
  • Quito, Ecuador
  • Caracas, Venezuela
  • Recife, Brazil

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    Eric Olson, Senior Commercial Officer in Brazil with Claudia Batista, a Brazilian colleague at the Consulate, celebrating the opening of the 2014 World Cup in Brazil.

When I joined FCS in 2006 as an officer, Asia was low on my list of places I wanted to go.  So where was my first assignment? Seoul, South Korea, of course! It was my first time in Asia, so I dove in and learned how crazy I’d been for not having been more excited .  The history of Korea’s post-war renaissance was fascinating in itself. A city almost totally in ruins in 1953, Seoul was a gleaming, bustling, rapidly growing, high-tech city of skyscrapers and massive highways intermingled with charming, historic alleyways selling sundubu stew and dukbokki when I arrived in the Spring of 2006.

As a first-tour officer, I got to play a supporting role in the negotiation of our FTA with Korea, which was followed intently by the local media. We worked closely with Las Vegas and Korean Air Lines to promote KAL’s new non-stop flight to Las Vegas. I even got to fly to Vegas on the inaugural flight. Using Seoul as a base, I traveled to eight countries in East and Southeast Asia, including some places not often open to tourism. I grew to love Asia.

In 2009, I moved to Quito, Ecuador – quite different from Seoul. It was a smaller pond in which to work, but I was fortunate to be the Senior Commercial Officer, so I had a much higher-profile job, advising the Ambassador on commercial issues in a challenging commercial environment, meeting with Ministers and private sector CEOs, and leading my own team. From our perch at 9,200 feet in Quito, there were easy daytrips to volcanic spas, camping trips at the base of a volcano, rafting trips into the Amazon basin, long weekends whale watching on the coast, and, best of all, two trips to the Galápagos Islands to soak in the natural splendor.

And now I’m in Northeast Brazil. Business is growing, I’m opening up a new office, and I’m in Brazil – the capital of fun. Carnaval comes around early in the year, and Recife hosts the second-largest party in the country. I was here for the international pageantry of the World Cup and got to see the U.S. team beat Ghana in a thriller and play Germany in Recife during a massive flood that shut down most of the city.  I’ll be finishing up my tour in 2016 with a trip to the Rio Olympics.

What’s next for me? Where will I be living this time next year? What new professional challenges and personal highlights are around the corner? Oh, the places I’ll go…

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Building Peace: Colombian Peace Presents New U.S. Business Opportunities

August 15, 2016

Steven Armendariz is an  Intern at the Colombia Desk at the International Trade Administration

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After decades of civil unrest, the Colombian government reached a ceasefire with the Revolutionary Armed Forces of Colombia (FARC) on June 23, 2016. The ceasefire deal was the last major step in reaching a final peace agreement, expected by the second half of August, according to Colombia’s Minister of Post-Conflict, Rafael Pardo. Peace is expected to bring many benefits to Colombia, including improved rule of law, security, and increased investment. This improved business environment has the potential to open a number of new opportunities for to U.S. companies.

Agriculture

Bogota, Colombia

The U.S. is an important trade and investment partner for Colombia. U.S.-based companies have been exporting an increased number products to Colombia since the U.S.-Colombia Trade Promotion Agreement went into effect in 2012. U.S. goods exports to Colombia stand at $16.3 billion in 2015, having grown 14% since the implementation of the agreement – compared to just 1.2% growth in U.S. goods exports worldwide over the same period. This makes Colombia our third largest export destination in Latin America.

Two industries that have made large gains are agricultural products and manufactured goods. Agriculture exports have doubled to $1.3 billion, and manufacturing exports grew 9.8% for a total of $14.5 billion in 2015.

One of the areas under negotiation as part of the peace process is comprehensive agricultural development. Therefore, a number of large agricultural development projects are planned as part of the government’s post-conflict strategy. The goal is to assist those areas most affected by the conflict and work to peacefully reintegrate the FARC and its former members into society. This priority has the potential to improve the standard of living for about 20% of the Colombian population that lives in rural areas affected by violence.

As Colombia seeks to develop and modernize its agricultural sector, U.S. agricultural equipment and services firms may find new business opportunities. For instance, new agricultural equipment imports can be subsidized by the government of Colombia, and the two-year, $500 million Colombia Siembra program is expected to increase agriculture growth in four years from 2.3% to 6.2% by 2018.

In addition, Business Monitor International found that total food consumption is projected to rise by 56.4% between 2014 and 2019. As a result, more opportunities may open up for businesses that provide value-add technologies to the sector, such as food processing and packaging companies.

Furthermore, Colombia’s post-peace development agenda includes a Contratos Plan (Peace Contracts) initiative led by the National Planning Department (DNP). This plan consists of about 1,450 priority peace projects for a total investment of about 14 trillion pesos, or USD$4.5 billion. The Peace Contracts will include long-term infrastructure projects, as well as other smaller development projects. The most important business opportunities for companies post-conflict include:

  • Infrastructure: roads, airports, aqueducts, schools, hospitals, telecommunications infrastructure, and connectivity
  • Tourism: development of rural tourism and ecotourism
  • Logistics: storage centers and regional distribution centers
  • Agriculture: commercialization of family farming, increased agricultural productivity at small scale farms, and development of irrigation districts.

Colombia is seeking international cooperation and private sector participation to fund several of these development projects. Some of the financial tools being considered are private investment incentives such as Free Trade Zones and Public-Private Partnerships in post-conflict areas. Minister Pardo has also proposed an adjustment to the private sector infrastructure tax. This will create tax incentives for businesses developing infrastructure projects in conflict-affected areas.

The post-conflict environment will present new business opportunities for U.S. companies. Accordingly, U.S. businesses should begin exploring the market now in order to take an advantage of these opportunities.

For information on doing business and exporting to Colombia, visit our web page, including information on upcoming trade events. The Colombian U.S. Commercial Service team is ready to support you in successfully doing business in Colombia.

 

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2015: A Banner Year for #FDIintheUSA

August 11, 2016

By Elizabeth Schaefer, Director of Investment Analysis, SelectUSA

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As SelectUSA’s resident economist, I am responsible for leading data, evaluation, and analytical work relating to foreign direct investment (FDI) promotion in the United States. So it was with great interest that I reviewed the newly released preliminary 2014 and revised 2013 FDI activity data from the Bureau of Economic Analysis (BEA), which follows the July release of 2015 FDI Inward Stock data measured by ultimate beneficial owner (UBO).

This updated data provides a picture of the inward flow of FDI into the United States, as well as the economic activity of U.S. affiliates of foreign-owned firms. The numbers reflect continued steady growth in productive FDI in the United States, and provide insight into the direct jobs, average compensation, and exports supported by FDI.

But as always, it makes most sense to start at the beginning.

FDI Definition and Parameters

Foreign direct investment, as defined by BEA, generally captures a long-term relationship with the management of a foreign enterprise which is usually linked with the real output of the country in which it operates.

Sources of FDI in the United States

 World map

The latest available 2015 data show the continued strong investment relationship with markets such as the United Kingdom, Japan, Canada, and Germany, which are historically large sources of investment into the United States. In fact, these top four sources of direct investment alone account for the majority of FDI in the United States. The top four fastest-growing sources of FDI in the United States, calculated by looking at 2010-2015 compound annual average growth rate, are Argentina, Chile, China and Malaysia. In contrast to the largest sources of investment, these top four relatively new sources of investment make up less than 1 percent of all FDI stock in the United States. It is important to note that these figures attribute FDI ownership to the market at the top of each investment’s ownership chain, the Ultimate Beneficiary Owner, rather than capturing investment passed through intermediate markets.

Jobs

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In 2014, FDI from majority foreign-owned firms was responsible for 6.4 million direct jobs in the United States, an increase of more than 1 million since the end of the 2009 recession. In addition, these are high-impact jobs. According to BEA, the average annual compensation per direct FDI worker in 2014 grew to $80,041.

Other Related Activities

R&D

FDI is also enhancing U.S. global competitiveness with increased spending on high-value activities such as research and development (R&D). The U.S.-based affiliates of majority foreign-owned firms spent nearly $57 billion on R&D activities in the United States.

Exports

Linkages between trade and investment also deepened due to growth in FDI. Exports of goods shipped by majority foreign-owned affiliates increased in 2014 to more than $425 billion, up from $360 billion in 2013 and accounting for over a quarter of all U.S. goods exports.

What’s Next?

This 2015 data is available in our SelectUSA Stats data visualization tool and updated activity data will follow shortly. A national level overview of FDI data is available on the SelectUSA website and updated country and state factsheets will soon be made available on the same page.

SelectUSA will host a webinar on the new FDI activity data, including state and industry detail, in the next month.

You can also follow our #FDIintheUSA campaign on Twitter!

For more information on FDI data and SelectUSA services, please send an email to info@selectusa.gov.

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U.S. Commerce Official Highlights Smart Cities Technologies in Singapore

August 9, 2016

Margaret Hanson-Muse, Regional Senior Commercial Officer, ASEAN U.S. Commercial Service, U.S. Embassy Singapore

Leading an official visit to Singapore from July 14 to 17 on behalf of the United Stated Department of Commerce, Assistant Secretary of Commerce for Global Markets and Director General of the U.S. and Foreign Commercial Service Arun Kumar emphasized opportunities for U.S. companies in Singapore and the global marketplace, focusing on the new and innovative Smart Cities Initiative. Kumar led a Water Infrastructure Business Development mission of nine U.S. companies to Singapore.

At an event co-hosted by the American Chamber of Commerce in Singapore and the US-ASEAN Business Council, Kumar launched the Smart Cities, Regions, and Communities: Export Opportunities guide that will assist U.S. companies in competing for and winning business opportunities in the emerging Smart Cities space. A Smart City is one that leverages technology and data to become more energy efficient, clean, and green, while addressing citizen engagement, governance, and critical needs in education and healthcare. Kumar was joined at the event by Mayor Steve Adler of Austin, Texas.

The new guide is an outcome of President Obama’s Smart Cities Initiative launched last year to leverage new resources and investment for the promotion of sustainable growth in communities throughout the United States while advancing U.S. business opportunities at home and abroad.

Focusing on U.S. export opportunities and citing a White House fact sheet, Kumar stated that “54 percent of the world’s population lives in urban areas, and continued population growth and urbanization will add 2.5 billion people to the world’s urban population by 2050. The associated climate and resource challenges demand innovative approaches. Products and services associated with the Smart Cities markets present significant opportunities for U.S. companies, since nearly 90 percent of this increase will occur in Africa and Asia.”

Showcasing Innovative “Smart” Technologies, a visit to Accenture

In recognizing Singapore as one of the world leaders in the development of Smart Cities technologies, Kumar visited the new Accenture Internet of Things (IoT) center to explore what innovation can mean for Smart Cities. He was escorted by Dwight Hutchins, Managing Director Accenture Strategy Products, Asia Pacific and Chairman of the American Chamber of Commerce of Singapore.

“A visitor to this Center is indelibly impressed by the power of digital technology and how it can be used to gain a competitive advantage” Kumar said. “Cities, like businesses, are also seeking ways to harness digital technology as a more efficient means of providing necessary services to their citizens. Singapore’s enduring commitment to innovation and to becoming a Smart Nation makes it an excellent choice to host such a center. This center is designed to help customers, including Cities, to capitalize on these new technologies to pursue long-term growth.”

The center seeks to help companies in sectors like consumer goods, agriculture, forestry, metals, mining, oil and gas, chemicals, and utilities to capitalize on innovation and new digital services and business models. It also focuses on intelligent connected devices and machines that comprise the Industrial Internet of Things. Centers such as this will be important catalysts for innovation and adoption of Smart Cities technologies.

U.S. businesses are well positioned to assist in Singapore’s Smart Cities development through technologies and services in the energy, environment, infrastructure, healthcare, and information technology sectors. As part of its Smart Nation program launched in 2014, Singapore has been monitoring and promoting urban sustainability and environmental cleanliness, increasing the potential for new and expanded U.S.-Singapore partnerships.

U.S. companies regard Singapore as an excellent place to do business. Since 2003, the World Bank Group has ranked Singapore first in the world in the ease of doing business. Moreover, bilateral trade between the United States and Singapore reached US$46.7 billion last year; a growth that has been enhanced thanks to the success of our bilateral Free Trade Agreement (FTA).

Since the U.S.-Singapore FTA came into force in 2004, U.S exports to Singapore have increased by 48 percent. The Trans-Pacific Partnership, which includes 12 countries, including the U.S. and Singapore, will be the next chapter in our strong commercial relationship.

The Obama Administration’s Smart Cities Initiative will invest more than $160 million in federal research funding and leverage more than 25 new technology collaborations to help local U.S. communities tackle key challenges such as reducing traffic congestion, fighting crime, fostering economic growth, managing the effects of a changing climate and improving the delivery of city services. The new initiative is part of the Obama Administration’s overall commitment to target federal resources to meet local needs and support community-led solutions.

For more information on export opportunities in Singapore, visit the U.S. Commercial Service in Singapore at http://www.export.gov/Singapore.

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