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SelectUSA Investment Summit Spotlight: U.S. Foreign Direct Investment (FDI) & Economic Data and Statistics

June 8, 2016

This post originally appeared on the Department of Commerce blog.

Guest blog post by Leeann Ji, Intern, SelectUSA

The United States welcomes foreign investment, and the numbers show that investors have confidence in the opportunities here. With a population of 320 million and a GDP that’s over $18 trillion, our nation is home to more foreign direct investment (FDI) stock than any other country: $2.9 trillion as of 2014. The U.S. affiliates of foreign companies directly employ 6.1 million people in the United States, and they spent $53 billion on American research and development in 2013.

FDI graphic

Graphic on U.S. Jobs Attributable to Foreign Direct Investment (FDI)

These numbers paint the big picture and America’s Data Agency, the U.S. Department of Commerce, provides a wide range of data that companies looking to invest in the United States need to inform their decision-making strategies.

Looking for U.S. economic data and analysis? The U.S. Government Pavilion in the Exhibition Hall at the 2016 SelectUSA Investment Summit will have representatives from federal agencies that can help participants find and understand U.S. economic indicators. They include:

  • The Economics and Statistics Administration (ESA) which performs high-quality economic analysis, disseminates national economic indicators   and fosters the mission of the U.S. Census Bureau (Census) , the Bureau of Economic Analysis (BEA) and the Office of the Chief Economist (OCE).  OCE created the Assess Costs Everywhere (ACE) tool for businesses to evaluate locating in the U.S.;
  • The Bureau of Economic Analysis (BEA) is a trusted and impartial source of data and statistics on the U.S. economy. BEA data is comprehensive and available for free to all;
  • The U.S. Census Bureau is the leading source of data about the nation’s people and economy;
  • The Commerce Data Service, which works across all Bureaus of the Department of Commerce to rapidly create and develop projects to advance the Department’s mission. The CDS is a team of data engineers, data scientists and technologists focused on applying user-centered design and agile methodologies to the process of data insight and product creation.  

Looking for data specifically on FDI? The new SelectUSA Stats is a data visualization tool that allows you to compare data on direct investment into the United States. The tool features interactive dashboards that display graphical data. The data, from sources like BEA, includes useful categories such as greenfield investment by country, U.S. FDI position and flow, and the characteristics of foreign companies operating in the United States.

Learn how to use this new tool! Sign up today for a free webinar on June 14, 2016. Two times are available: 12:00 p.m. or 8:00 p.m. EST. To register, please contact Micah Escobedo.

Looking to invest or find tools to help you attract investment? If you are coming to the SelectUSA Investment Summit, be sure to stop by the U.S. Government Pavilion, located across the lobby from the Exhibition Hall. If you aren’t able to attend in person, we are standing by to assist all year round. Please visit www.SelectUSA.gov and contact us to learn how we can help investors and U.S. economic development organizations with business investments in the United States.

Together, our colleagues work to ensure users have access to timely and reliable economic information to move their investments forward. We look forward to working with you!

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Chile – Your Next Export Market

June 8, 2016

Ellen Lenny-Pessagno is a Senior Commercial Officer in Santiago, Chile

Name any country economic or commercial indicator, and you will probably find Chile at or near the top among its peers in Latin America.  GDP per capita – #1, Open market – #1, Ease of Doing Business – #1, Smart Cities – #1.  I could go on and on.  Chile’s achievements are even more remarkable given that just 30 years ago, its GDP per capita was among the lowest in South America.

Chile

15,426 U.S. companies exported goods to Chile in 2013 – 87.7% were small and medium-sized companies.

But Chile has ambitions to go further still.  As one of just two Latin American countries that are members of the OECD, a grouping of advanced economies, Chileans now gauge their success and guide their development based on how they measure against their OECD peers. In other words, Chile no longer aspires simply to build the strongest economy in Latin America—they also want their economy to be among the strongest in the world.

Chile’s strategy to continue its development is heavily based on integration into the global economy.  Chile’s growth has been spurred by its aggressive pursuit of a free trade, open market model for well over two decades. Today, most goods enter Chile duty free given the trade agreements it has negotiated with the United States and 63 other countries (and counting).  That trend is continuing.  Back in 2005, Chile, along with Brunei, New Zealand and Singapore, developed the P4 to further develop Pacific trade. The original P4 evolved into the Trans-Pacific Partnership, with 12 member countries.

As with other emerging markets, Chile has faced challenges in recent years.  Following more than 20 years with an average annual growth rate of 5%, the Chilean economy slowed to less than 2% annual growth the last two years. This slowdown is expected to continue for another two years, until commodity prices rebound – Chile is the world’s leading copper exporter. Agriculture has also proven crucial to Chile’s robust growth, as the world’s 10th largest agribusiness exporter.

Still, opportunities abound for U.S. exporters in Chile.  Currently, Chile is the 4th largest export market in Latin America for U.S. exports and the 22nd largest in the world. Over 15,000 U.S. firms currently export to Chile, 80% of which are U.S.SMEs. In the past two months alone, my team has supported more than 250 U.S. firms in the Chilean market, both through our customized services and through U.S. business participation in key trade shows held in Chile.  During FIDAE, the most important aerospace and defense show in the region, more than 100 U.S. firms promoted their technologies to ranking members of the Armed Forces from all over South America.  At the show, a U.S. aircraft manufacturer celebrated the delivery of three airplanes to the Chilean Forestry Service, which will better equip them for the next round of forest fires. Over 20 years ago, the U.S. Commercial Service founded what has become the second largest mining show in the world, EXPOMIN. U.S. firms outnumbered firms from any other single country at EXPOMIN 2016 – including firms from Chile! I gave a business briefing at EXPOMIN to a standing room-only crowd of U.S. firms, which was followed by a presentation by the regional VP of a U.S. mining extraction company, who discussed how the industry is adapting to lower copper prices and strategies for selling during these lean times. Chilean President Michelle Bachelet attended both FIDAE and EXPOMIN, where she spent significant time in the U.S. pavilions, demonstrating the Chilean government’s commitment to our trade partnership at the highest levels.

U.S.-Chile bilateral trade has quadrupled since the U.S.-Chile FTA entered into force in 2004, and U.S. investments in Chile have grown at comparable rates, due to a transparent, rules-based business environment.  The United States is the largest source of investment in Chile and we expect this trend to continue. Nonetheless, maintaining competitiveness in this very open market is a major challenge. Two years ago, China surpassed us as the country that provided the largest percentage of goods and services to Chile.

So, how can the United States reverse this trend?  By passing the TPP Agreement.  Chile’s domestic debate on the agreement mirrors our own, as civil society and businesses evaluate TPP’s possible impacts on their livelihoods and economic interests. Yet, this relatively small, geographically isolated country recognizes that it benefits from strengthening relationships on both sides of the Pacific. Interestingly, while academic studies forecast that immediate TPP effects on Chile’s trade, investment and income are relatively minimal– as it already has free trade agreements with all the countries included in the agreement – the Chilean government sees the advantages of deepening and expanding free trade integration and the inclusion of harmonious standards as important for its future growth and partnerships.  Chile also values being at the forefront of global trade — part of a group of countries representing over 40% of global GDP — where it plays and active role formulating the rules of the road. The interest already expressed by other Asia-Pacific countries in joining TPP demonstrates how a relatively small market such as Chile can play a key leadership position in the global trade arena.

Once in force, TPP will offer U.S. firms additional export opportunities to Chile. As Chile capitalizes on the products that will receive greater market access via TPP, U.S. firms will be poised to export additional agricultural and food processing equipment needed by Chilean agro-exporters. Increased trade will require expanded road, port and logistics infrastructure, presenting further opportunities for U.S. firms. Unlike any other U.S. FTA, TPP has a chapter dedicated to reducing barriers for small businesses to export, including raising the de minimus for declarations on express shipments, which is likely to have major, positive macroeconomic impacts for the precise SME clients that we serve. Finally, TPP will support the U.S.’s growing services exports to Chile ($3.8 billion in 2015) by expanding market opportunities in retailing, logistics/express delivery, and internet industries.  To learn more about U.S. export opportunities to Chile under TPP visit our Chile TPP Country Report.

If the U.S. Congress fails to approve the TPP Agreement, our partners, such as Chile, will look elsewhere.  For example, Chile is working in parallel to expand another trade pact, the Pacific Alliance, which includes Mexico, Colombia, Peru, and Chile. While this trade agreement is not as comprehensive as the TPP, it allows these countries to deepen economic and commercial ties. Numerous Asia-Pacific countries aspire to join this group, and Chile has already announced the intention to begin discussions with New Zealand and later Australia, regarding potential membership in the Pacific Alliance.

The Chilean government and business community have a deep appreciation for U.S. partnership on a host of issues, arguably the strongest of which is trade. Via TPP, we will continue to build our bilateral trade and investment relationship to forge the way for 21st century global trade policies that benefit both of our countries.

To learn more about exporting to Chile and the region, come join me at the 2016 Trade Winds – Latin America Business Development Conference and Trade Missions which we are hosting in Santiago from September 7-9.  This two-day conference will assist you to develop sales strategies and sales channels through meetings with my fellow Senior Commercial Officers from the region, panel discussions with experts on market trends, and networking with representatives and buyers. I hope to see you there! To learn more visit Trade Winds.

 

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SelectUSA Investment Summit Spotlight: The U.S. Government Pavilion

June 6, 2016

Felicia Pullam is the Director of Outreach for SelectUSA.

The 2016 A.T Kearney Foreign Direct Investment (FDI) Confidence Index surveyed global executives about their plans for foreign investment, and they ranked the United States at the top for the fourth year in a row. A.T. Kearney also asked executives to identify the two most important factors for deciding where to establish or expand their businesses. “Regulatory transparency and lack of corruption” tied for first place with the size of the domestic market and the cost of labor; each factor was chosen by 15 percent of respondents. The “efficiency of legal and regulatory processes” was just a few points behind at 13 percent.

Secretary Perez

Secretary Perez visits DOL’s ‘Apprenticeship USA’ booth last year in the U.S. Government Pavilion

The United States is a stable democracy with a transparent and predictable legal system, and we offer an even playing field to businesses operating within our borders, regardless of country of origin. Ranked in the top ten overall for ease of doing business by the World Bank, the United States ranks first among nations with populations over 100 million. When companies locate operations here, they find an environment that is friendly to businesses because we understand that FDI creates jobs, drives exports, and contributes to innovation. An estimated 12 million American jobs can be attributed to FDI through direct employment, sourcing, productivity growth, and other economic effects.

While the U.S. system is considered to be among the most transparent, we recognize that learning how to navigate a new regulatory system can be challenging for first-time investors or small and medium-sized businesses. SelectUSA assists companies to find the answers they need to move their investments forward by working with more than 20 U.S. federal agencies through the Interagency Investment Working Group. At the 2016 SelectUSA Investment Summit, participants will have the opportunity to meet with representatives from these federal agencies in person.

If you are coming to the SelectUSA Investment Summit, be sure to stop by the U.S. Government Pavilion, located near the Exhibition Hall. Representatives from SelectUSA and a wide variety of other agencies will be available to discuss federal programs and services. You will find experts who can walk you through data on the economy, population, and FDI trends. Officials will also be standing by to provide information on workforce and training programs, U.S. exports, supply chain, research and innovation, U.S. visas, and the Global Entry program.

The following agencies and offices are looking forward to meeting you:

If you aren’t able to attend the SelectUSA Investment Summit, we are standing by to assist all year round. Please visit www.SelectUSA.gov and contact us to learn how we can help investors and U.S. economic development organizations with business investments in the United States.

We look forward to seeing you at the 2016 SelectUSA Investment Summit or online!

 

 

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SelectUSA.gov Redesigned: A “First Stop” for Companies and Economic Development Organizations

June 6, 2016

This post originally appeared on the Department of Commerce blog.

Guest blog post by Genilson Brandao, Senior Communications Specialist at SelectUSA

Earlier today, SelectUSA launched our newly redesigned website, SelectUSA.gov. The new website was developed as a “first stop” for our clients – companies seeking information about investing in the United States and economic development organizations (EDOs) looking to attract investment to their communities – to provide keyforeign direct investment (FDI) data, resources, and news and updates.

SUSA Website

Graphic of the Newly Redesigned SelectUSA Web site

In addition to a new design and fresh content, the newest feature is SelectUSA Stats, an investment data tool that will enable users to effortlessly access, understand and manipulate FDI data. The data visualization functionality will help site visitors see and compare the useful statistics in new ways. Interactive dashboards display graphical data on direct investment by foreign companies into the United States from sources like the U.S. Bureau of Economic Analysis (BEA). The data categories include U.S. FDI position and flow, FDI in the United States by country, employment, characteristics of foreign firms operating in the country, greenfield investment by country, and venture capital and private equity country attractiveness scores.

Additionally, the SelectUSA.gov site highlights the benefits and advantages of investing in the United States. In the “Why Invest” section on the website, users can find facts and information, and can explore the many reasons that make the United States a top investment destination. Fromconsumer markets to innovation and workforce, site users can build their case for investing in the United States. Visitors can also get an overview of thriving U.S. industries, federal programs, and state business incentives to identify opportunities to move their investments forward.

SelectUSA continues to offer a variety of services to companies and EDOs to help them find answers to their investment questions. Similarly,SelectUSA events like road show and seminars and special events, gives the opportunities for foreign investors and EDOs to connect.

The launch of the new and upgraded SelectUSA.gov is a step toward better user experience and engagement with all audiences seeking to learn about the importance of FDI as well as investing and attracting investment into the United States.

To discover and explore the new website, visit www.selectusa.gov, and share your feedback via  email or tell us in person when you stop by the U.S. Government Pavilion at the upcoming 2016 SelectUSA Investment Summit!

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TPP: Doing Business in Canada

June 2, 2016

Christopher Quinlivan is a Senior Commercial Officer at the International Trade Administration 

The United States and Canada share the world’s largest trading relationship.  The magnitude of the relationship is incredible, accounting for nearly $2 billion in cross border trade each day.  In fact, Canada is the top export market for 35 out of 50 states.  So whether your company is a first-time or seasoned exporter, Canada should be a key component of your overseas growth strategy.

Flags

USA and Canada flag

Such deep commercial ties make Canada an ideal “launch pad” for new exporters.  Why?  First, Canada is a highly receptive, open and transparent market for U.S. products and services, with Canadians spending more than 60 percent of their disposable income on U.S. goods and services.  Americans and Canadians “speak” the same language literally and figuratively.  In addition to French in some areas, English is almost universally spoken, making business communication a breeze.  We share a similar lifestyle, engendering a certain level of cultural familiarity.  Finally, close geographic proximity, and initiatives between our governments such as Beyond the Border, Regulatory Cooperation Council and Trusted Traveler make cross-border business increasingly seamless.

These factors are strengthened by new and existing trade agreements which ensure that companies on both sides of the border are able to enjoy robust business relationships.  Since the implementation of the North American Free Trade Agreement (NAFTA) in 1994, trade between our two counties has more than doubled.  The Trans-Pacific Partnership (TPP) agreement would further expand business opportunities in key sectors (i.e. automotive, chemicals, machinery, and consumer goods) for both our countries, while also enhancing IP protections, deepening regulatory coherence as well as promoting common rules of origin and customs procedures.  The TPP agreement also provides new markets for U.S. and Canadian exporters in the booming Asia-Pacific region.  The 12 countries in the TPP account for 40 percent of global GDP, presenting unprecedented opportunities for our companies. See our newly released TPP country report here for more details.

The ease of doing business in Canada attracts many U.S. exporters, yet the country’s subtle but important differences from the United States can trip up the unprepared.  U.S. exporters must understand provincial regulations, conduct due diligence on market potential, sales channels, labeling and packaging requirements, certification standards, and customs procedures, and educate themselves on unique industry matters relevant to selling their goods or services in Canada.

The great news is that our friendly neighbor Canada is a market where U.S. products and services compete well, and it should not be overlooked by any company looking to expand sales.  U.S. Commercial Service teams at the Embassy in Ottawa and consulates in Montreal, Toronto and Calgary are positioned to support your company throughout Canada, from market exploration to execution.  We look forward to seeing your company join the ranks of the 95,000 U.S. companies that export to Canada every year!

 

 

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World Trade Month May be Coming to an End, but our Work Continues

May 27, 2016

This post originally appeared on the Department of Commerce blog.

World Trade Month logo

World Trade Month logo

During the past few weeks, ITA employees have participated in events across the country in recognition of World Trade Month. The month gives us all an opportunity to acknowledge the importance of trade and investment as a driver of prosperity for our workers, businesses, and the U.S. economy.

Under Secretary Stefan Selig kicked off World Trade Week at the International Trade Awards breakfast with business leaders and foreign government representative in New York City.

On May 16, U.S. Secretary of Commerce Penny Pritzker honored 123 U.S. companies and organizations that export goods and services overseas during the 2016 President’s “E” Awards ceremony. This year, for the first time in the award’s 54-year history, winners represent every state and the District of Columbia. This was a true representation that trade is fundamental to the success of American workers.

During the week of May 16 we celebrated World Trade Week by leading two trade missions: a renewable energy trade mission to Mexico and a business development mission to the South Pacific.

In addition, on May 25, we had the pleasure of partnering with the Global Innovation Forum—a project of the National Foreign Trade Council—for an educational program at Microsoft Ventures in Seattle as a part of our Startup Global program, an initiative designed to help more startup firms think on a global scale from the earliest stages of growth.

But as we look forward beyond May, we must think about the work that must continue. Bilateral trade agreements like the Trans-Pacific Partnership (TPP) are crucial to our economies success. The agreement will eliminate high tariffs and provide a strong path for our businesses here at home.

The ITA staff has developed useful resources on the agreement that can help exporters look forward to this 21st century trade agreement. The Opportunities by Markets Report, Jobs Supported by Exports, country fact sheets, tariff tool and state fact sheets- are all FREE tools that highlight new opportunities available once TPP is passed.

In addition to TPP, we are looking forward to the SelectUSA Summit, June 19-21 in Washington DC. The Summit brings companies that are considering establishing or expanding operations together with economic developers from across the country to learn how the U.S. climate for innovation—as well as the other advantages offered by the United States—can support their global competitiveness. We expect to welcome more than 2,000 participants to Washington from approximately 70 countries and every corner of the United States.

Although World Trade Month may be coming to an end, our work here at ITA will continue. We will continue to advocate fair trade across boarders for American businesses and its workers. We will also continue to provide our customers with resources to help them make informed decisions before, while and after doing business abroad. Stay up to date on the resources available by subscribing to our ITA Newsletter, a monthly update on the latest news in trade.

And for those of you on social media, thanks for being a part of the conversation! #worldtradeweek #EconDevWeek.

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Partnering to Go Global: ITA & Baruch College

May 27, 2016

Jamie Merriman is the Acting Director of ITA’s Office of Strategic Partnerships

Baruch College, an ITA Strategic Partner, is empowering its students and solving real-world business problems through an innovative program with ITA’s U.S. Export Assistance Center (USEAC) in New York City.  Students in Professor Rajeev Sawant’s capstone class in the undergraduate international business major have an opportunity to assist local businesses that are clients of the USEAC with their strategy for entering international markets.

One of the Baruch international business capstone teams at World Trade Week NYC 2015

One of the Baruch international business capstone teams at World Trade Week NYC 2015

As part of their capstone class, the students work on a real-life case applying their theoretical learning to help a local company go global. This ‘live case’ method of teaching has provided practical help to real companies in NYC.

One company, Beauty Solutions, asked the students to identify the most promising new export markets for its lipstick brand.  The students researched various markets, analyzing the level of interest in U.S. products, the stability of the local currency, and the percentage of shopping done via television, as well as other factors.  The students developed a methodology to rank the researched markets and presented their findings to Jerry Rauchwerger, the President of Beauty Solutions and a Baruch alum, at the conclusion of the course.  Beauty Solutions found tremendous value in the students’ advice, and is utilizing their recommendations in planning its international marketing strategy.

The capstone program has provided actionable market insights to other businesses in the NYC area – and even generated employment opportunities for some enterprising students!  The students also supported ITA and Baruch last week during World Trade Week NYC.

ITA Strategic Partners like Baruch College provide critical linkages between ITA and U.S. businesses, helping us to reach more exporters and arm them with the information they need to succeed in today’s globally competitive marketplace.  ITA’s mission to strengthen the competitiveness of U.S. industry and promote trade and investment strengthens the U.S. economy, supports U.S. jobs, and fosters long-term, sustainable growth.

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