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Building Relationships: The Key to Making Illinois a Top Location for FDI

October 10, 2018

This post is part of SelectUSA’s EDO Spotlight series, highlighting the work of EDOs around the country recruiting foreign direct investment, how that work supports jobs and economic growth across the United States, and how SelectUSA partners with EDOs to support economic development.

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

Mark Peterson is President & CEO of Intersect Illinois

Foreign direct investment (FDI) is key to the economic renaissance underway in Illinois. With more than 1,800 foreign owned companies already calling Illinois home and contributing more than $100 billion to the state’s GDP, the potential for growth is tremendous.

Relationship building on an international scale is crucial to Illinois’ foreign investment strategy. Over the past year, Intersect Illinois has built strong international relationships while promoting the state’s assets. Intersect has taken part in jobs missions to China, Japan, Germany, Poland, and Italy and hosted multiple delegations from these countries that have directly resulted in investment in Illinois.

The Intersect Illinois booth at the 2018 SelectUSA Investment Summit, June 18-20, 2018.

The Intersect Illinois booth at the 2018 SelectUSA Investment Summit, June 18-20, 2018.

A recent example of the results is Faber-Castell Cosmetics’ announcement of its first North American manufacturing facility in Illinois. The German company’s state-of-the-art $9 million manufacturing plant in Elgin will create 50 full-time jobs. The decision to locate in Illinois came after Intersect Illinois led a trip to Germany, where the delegation (including the governor) met with Faber-Castell’s leaders.

Intersect Illinois also coordinated a visit to China and Japan, that included meetings with companies such as Aisin Seiki (employs 843 people in Illinois), Sakae Riken Kogyo Co., Ltd. (which employs more than 400 in Illinois), and Toyota Boshoku, which has a plant in Lawrenceville. The team also met Caterpillar China, toured Wanxiang Group, and met with more than 60 businesses.

Following the visit, Intersect Illinois welcomed the newly appointed Japanese Ambassador to Illinois on a visit that focused on advancing the state’s business partnerships with Japan. This was part of the consul-general of Japan in Chicago’s Grassroots Caravan program to highlight the contributions of Japanese companies to local economies.

The group toured local Schaumburg companies to see the latest manufacturing innovations and learn more about Illinois’ workforce. The visit reinforced the benefits of foreign direct investment, while showcasing Illinois as a premier location for Japanese companies to grow.

Additionally, Intersect Illinois attended a SelectUSA event in three cities in Italy, meeting with several Italian companies interested in opening operations in the United States. Following the trip, Intersect hosted site tours for Cembre S.p.A, a company from Verona, Italy that attended the SelectUSA event. In August, Cembre opened a sales office in Schaumburg, with plans to distribute its imported products. Intersect also recently hosted site tours for another Italian manufacturer it met in Italy, which is looking to launch its first U.S.-based manufacturing operation.

Through proactive outreach, Intersect Illinois’ project pipeline has nearly quadrupled over the past year; the team is currently working on nearly 100 business attraction projects, more than 50 percent of which are FDI projects. That number is expected to grow as Intersect Illinois continues to market the state’s rich assets around the globe.

With the world’s 17th largest economy, Illinois is a proven global player and an excellent destination for international business. For more details on Intersect Illinois’ comprehensive FDI strategy, or how Illinois supports global companies, visit www.IntersectIllinois.org.

 

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ITA’s Office of Standards and Investment Policy

October 2, 2018

Did you know that ITA has an Office of Standards and Investment Policy? Candice Appiakorang in ITA’s Office of Public Affairs sat down with Eileen Hill, Team Leader for Standards in the Office of Standards and Investment Policy to get an in-depth look into the importance of standards and testing to exporters.

Keep reading to find out how this office helps goods and services to move easily between markets!

Candice: What is the Office of Standards and Investment Policy?Teamwork

Eileen: The Office of Standards and Investment Policy (OSIP) is in the Industry & Analysis unit of the International Trade Administration (ITA). The Standards Team in OSIP focuses on addressing standardization issues before they become market barriers. The Standards Team also seeks to ensure trading partners accept the standards U.S. manufacturers use to satisfy regulatory requirements, which helps our companies avoid re engineering products or undergo unnecessary, costly testing. Additionally, the Standards Team in OSIP works proactively to ensure that U.S. stakeholders can participate in standards development to protect their market access opportunities.

Candice: How do standards and testing support global sales?

Eileen: Standards are the foundation that enables global trade, competitiveness, and technology development. Standards are essential to accelerating the widespread commercialization of new technologies and enabling goods to move easily between markets. Testing demonstrates that a product complies with a specific standard and builds confidence that a product will perform as stated. Together standards and testing help improve access to global markets, thereby strengthening global trade.

Candice: To export successfully, you clearly need to know how to navigate the global standards, testing and regulatory landscape. What are the first steps an exporter should take to become aware of this important information?

Eileen: Export.gov is a helpful resource. ITA’s Country Commercial Guides are an excellent starting point to find everything you need to know about doing business overseas. These guides have a standards and regulations section to help you decide if a market is right for your product or service. The Top Markets Reports from Industry & Analysis include information on the global regulatory landscape for 27 sectors. Exporters should also consider signing up for the free Notify US service, administered by Commerce’s National Institute of Standards and Technology (NIST), to learn about and comment on technical regulations and conformity assessment procedures proposed by trading partners that could impact market access. Information can be customized by sector or country. Another useful website is NIST’s www.standards.gov, which has industry guides, including on the China Compulsory Certificate (CCC) mark. Our trade specialists around the world can help you navigate the full menu of ITA services; first-time exporters should connect with their local U.S. Export Assistance Center..

Candice: What are some tools exporters can use to address specific standards export problems?

Eileen: ITA has a complete toolbox. We can assist in resolving transactional issues via our network of offices around the globe, which can connect with the appropriate foreign ministry or standards body to resolve technical issues. OSIP works to foster public-private partnerships to tackle standardization challenges; connects U.S. and foreign regulators on specific sector issues; and promotes U.S. standardization solutions that underpin emerging technologies. Much of this work happens in regional fora such as the Asia-Pacific Economic Cooperation forum (APEC) and the Association of Southeast Asian Nations (ASEAN). ITA also raises standards issues in ITA-led bilateral exchanges, the commercial dialogues ITA organizes with U.S. trading partners, trade agreement discussions, and at the World Trade Organization.

Candice: And for our readers who have not reached international markets just yet, what are some things they could do to prepare for standards that may impact potential global sales?

Eileen: Get involved in the standards development work relevant to your products! Taking a seat at the table will ensure that your interests are reflected. Contact our office to learn more about standards!

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Manufacturing Leads as Top Sector for Foreign Direct Investment in the United States

September 28, 2018

Maureen Book is a Research Analyst in SelectUSA

With Manufacturing Day fast approaching on October 5, this is a great opportunity to recognize the important role that foreign direct investment (FDI) plays in the U.S. manufacturing sector. Throughout the past 20 years, the manufacturing sector has been the largest recipient of all foreign direct investment in the United States, and as of 2017 it represented nearly 40 percent of the total U.S. FDI position, amounting to $1.6 trillion. This is almost three times the amount of the next largest sector for FDI in the United States: finance.

What types of manufacturing are attracting investment?

Within the manufacturing sector, the chemicals industry is the largest recipient of FDI, reaching $702.7 billion in 2017, or 44 percent of all manufacturing FDI stock, according to the latest data released by the Bureau of Economic Analysis. Diving even deeper, the pharmaceuticals and medicines subsector makes up 74 percent of all chemicals industry FDI, representing nearly $517 billion of investment.

Industry Breakdown of FDI

Source: Department of Commerce, Bureau of Economic Analysis, FDIUS

After chemicals and other manufacturing, the transportation equipment industry is the next largest recipient of FDI within the manufacturing sector, attracting approximately $150 billion in investment. The majority of FDI stock in transportation equipment consists of motor vehicles and parts manufacturing (78 percent).

Not only is the chemicals industry the largest sub sector of manufacturing FDI, but it is also the fastest-growing. Over the past five years, the chemicals industry has experienced an average annual growth rate of nearly 24 percent. Though the computers and electronic products subsector captured only $81.9 billion in FDI stock in 2017, it was actually the second fastest-growing segment of manufacturing FDI, with an average annual growth rate of nearly 14 percent over the past five years. Food manufacturing is close behind, growing at an average annual rate of 13 percent.

Fastes growing subsectors of US MFG FDI Position

Source: Department of Commerce, Bureau of Economic Analysis, FDIUS

Where is manufacturing FDI coming from?

Just as the United Kingdom is the largest source of all FDI in the United States, it is also the largest source of manufacturing FDI (by UBO*). In 2017, FDI stock from the UK amounted to nearly $258.7 billion in the manufacturing sector. The second largest source of FDI in U.S. manufacturing was Ireland, with over $224 billion. Rounding out the top five source markets are Germany, Japan, and France.

In terms of the fastest-growing sources of FDI in U.S. manufacturing, foreign investment from China has grown the most since 2012, with an average annual growth rate of 64.5 percent. Following China are Luxembourg, Brazil, Ireland, and Canada.

Source: Department of Commerce, Bureau of Economic Analysis, FDIUS

Source: Department of Commerce, Bureau of Economic Analysis, FDIUS

FDI in U.S. Manufacturing Supports Jobs, R&D, and Exports

In addition to the dollars that foreign firms are investing in the U.S. economy, foreign firms also support the U.S. manufacturing sector through job creation, investment in research and development (R&D), and contributions to U.S. exports. The latest available data shows that in 2015, foreign majority-owned affiliates employed nearly 2.5 million people in the U.S. manufacturing sector. In the same year, foreign firms also spent $39.7 billion on R&D expenditures in U.S. manufacturing and contributed over $201.9 billion towards U.S. exports.

For more information

Please visit SelectUSA.gov to view industry fact sheets, other industry reports, international and domestic FDI fact sheets, and SelectUSA’s data visualization tool, SelectUSA Stats. Sign up for email updates and follow SelectUSA on Twitter and LinkedIn for the latest updates, compelling infographics, and more.

*UBO refers to the ultimate beneficial owner, the entity at the top of an affiliate’s ownership chain.

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How to Become a Member of our Trade Finance Advisory Council

September 10, 2018

Ericka Ukrow is a Senior International Trade Specialist in the Industry & Analysis Office of Finance and Insurance Industries in the International Trade Administration and serves as the Designated Federal Officer for the Trade Finance Advisory Council.

Interested in Advising the Secretary of Commerce on Trade Finance Solutions?

I have great news! The U.S. Department of Commerce has announced the re-chartering of its Trade Finance Advisory Council (“TFAC” or the “Council”). This federal advisory committee advises the Secretary on how to expand access to finance for U.S. exporters and their foreign buyers.

What Does the TFAC Do?

During its first two-year term, the TFAC provided detailed policy and technical recommendations to enhance private and official financing options for U.S. companies—and grew to become a premier platform for government engagement with the private sector on trade finance.

In its renewed charter term, the TFAC will bring together an expanded number of trade finance professionals and thought leaders and will for the first time include, as ex-officio members, representatives from the Export-Import Bank of the United States and the U.S. Small Business Administration.

The TFAC works to advance the Department’s strategic goal of increasing U.S. exports and job creation by reducing the costs, complexities, and risks of exporting. In particular, the Council:

  • Evaluates credit conditions and financing challenges faced by U.S. exporters,
  • Identifies potential resources for addressing financing gaps,
  • Examines how new financial technologies and other innovations could improve the availability and affordability of trade finance solutions,
  • Highlights trade finance-related developments in international standard setting bodies, and
  • Addresses other noteworthy concerns raised by Council members and the public.

How Is the TFAC Structured?

The TFAC is comprised of up to 25 members appointed by the Secretary of Commerce to serve for a two-year term. Members do not receive compensation for their service to the Council.

Except for those Members who are trade finance experts from academia and public policy organizations, TFAC Members express their own views and insights and those of the entity or organization and industry sector they represent. Those Members who serve as experts from academia and public policy organizations are subject to ethical standards applicable to special government employees.

What Are the Criteria for TFAC Membership?

The TFAC is seeking executive-level candidates who will reflect a balanced cross-section of U.S. trade finance users, providers, and experts from private, public, and not-for-profit organizations. We are looking for business representatives from diverse industries, regions, and company sizes—including:

  • U.S. exporters of goods and services,
  • U.S. commercial banks that provide trade finance products, cross-border payment services, or foreign exchange solutions,
  • Non-bank U.S. financial institutions that provide trade finance products, cross-border payment services, or foreign exchange solutions,
  • Associations that represent (i) U.S. exporters, and/or (ii) commercial banks or non-bank financial institutions (or other professionals) that facilitate international trade transactions,
  • U.S. companies or entities focused on trade-finance-related activities or services;
  • U.S. scholars, academic institutions, or public policy organizations with expertise in global business, trade finance, and international banking related subjects, and
  • Economic development organizations and other U.S. regional, state, and local governmental and non-governmental organizations whose missions or activities include the analysis, provision, or facilitation of trade finance products/services.

Members will be selected based on their ability to achieve the Council’s objectives, in accordance with applicable Department of Commerce guidelines and in a manner that ensures a variety and balance of views.

When is the Deadline for Membership Applications?

To be considered, applicants must submit the required documentation by 5:00 p.m. EDT, Monday, October 15, 2018 to TFAC@trade.gov.

For full membership criteria and application details, please review the Federal Register notice announcement, or the Council’s website at www.trade.gov/TFAC/.

For additional information, please contact Ericka Ukrow, Designated Federal Officer, Office of Finance and Insurance Industries, at (202) 482-0405, or at TFAC@trade.gov.

Click here to see our TFAC FAQs.

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ITA’s South Korea/U.S. Power Working Group: Bringing Together Major Decision Makers

September 6, 2018

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

This is the fourth and final entry in a series of guest blogs highlighting ITA activities that help connect U.S. companies to opportunities in the Indo-Pacific region following the recent Indo-Pacific Business Forum where Secretary Ross, Secretary Pompeo and other cabinet officials spoke about the Administration’s commitment to the region.

Click here to read the second entry of our Indo-Pacific blog series.

Guest Blog Q & A with Mitchell Williams, Managing Director, Curtiss-Wright Korea, Japan

ITA: Tell us about your business and what makes your product/service unique?

Williams: Curtiss-Wright Corporation has a long history with its roots dating back to Orville and Wilbur Wright’s first flight in 1903, and Mr. Glenn Curtiss, the father of naval aviation. In 1929, the companies founded by these three great aviation pioneers, the Curtiss Aeroplane and Motor Company and Wright Aeronautical Corporation, merged to form the largest aircraft company at the time, Curtiss-Wright Corporation.

Mitchell Williams

Mitchell Williams, Managing Director, Curtiss-Wright Korea, Japan

We have continued the path of innovation and advanced engineering and have applied that expertise to a number of critical applications in high-performance markets. Our success has resulted in a world-renowned reputation for performance, long-standing customer relationships and significant growth and profitability in the markets in which we compete.

Today, we are a diversified, multinational provider of highly engineered, technologically advanced products and services. We maintain a balanced and diversified business portfolio with revenues generated across our three segments: Commercial/Industrial, Defense and Power, which support several of the largest, most vital industries in the world. We have been a publicly traded company for nearly 90 years and our highly engineered, innovative products and services are recognized for their advanced technology and unsurpassed reliability.

What makes a world-class organization? It all begins with core values that provide a strong foundation for success. Simple in theory, the values of Curtiss-Wright are reflected in every aspect of our operations. To our employees, these are more than words on a wall – we all take these values to heart in our relationships with our customers and each other.

ITA: How do you see Asia affecting your business in the future?

Williams: Our opportunities in Japan have increased in the industrial space as nuclear plants have remained closed and alternate sources of power have been introduced. Particularly in the data analytics and remote monitoring solutions areas we have seen success through our partnerships with the local power companies. The continuous phase-out of nuclear power in South Korea is expected to shrink our order volume as we lose locations. The 2030 plan from the Korean government calls for 13GW of renewable energy which is providing opportunities to play more in that space. Taiwan is looking to restart their nuclear fleet to meet their energy needs. This change will also provide opportunities there.

ITA: What was uniquely useful about the South Korea/U.S. Power Working Group?

Williams: It was uniquely helpful in that it brought together major decision makers and shareholders to deliberate on issues facing the industry. All presented well-thought out and prepared statements which provided useful knowledge and background into the opportunities and challenges we face today. Where presentations were made, all materials were provided to the participants for future reference. This caliber of meeting demands the respect of all included and turns competitors into colleagues and government officials into friends. Nowhere else have I seen this level of participation and quality discussion.

ITA: Why do you work with ITA? And/or How has ITA already helped you in Asia?

Williams: The ITA works to increase U.S. content through advocacy, webinars, seminars, working focus groups and more. ITA members have been supportive of the work we do and of helping us to achieve our goals in Asia. Members of the ITA’s U.S. Commercial Service have shown support by attending industry events, seminars, and conferences together to learn more about the industry and to provide support where necessary. They have introduced us to high level officials during their visits to Asia, something we would have had much difficulty arranging on our own. Finally, the ITA supports the work I do as Chair of the Energy and Environment Committee at the American Chamber in Korea. They are always keen to attend committee meetings and provide meaningful input. I would recommend the ITA services to any multinational company wanting to do business more intelligently and mitigate risk in Asian markets.

ITA is proud to connect U.S. companies to opportunities in the Indo-Pacific region. If you are interested in how ITA can help you access Asian markets, contact your local International Trade Specialist.

 

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ITA’s Indonesia Power Working Group: Open Access to the Decision Makers and Policy Makers

August 31, 2018

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

This is third entry in a series of guest blogs highlighting ITA activities that help connect U.S. companies to opportunities in the Indo-Pacific region following the recent Indo-Pacific Business Forum where Secretary Ross, Secretary Pompeo and other cabinet officials spoke about the Administration’s commitment to the region.

Click here to read the latest entry of our Indo-Pacific blog series.

Guest Blog Q & A with David Mansfield, Director for Asia, Powerphase International Singapore

ITA: Tell us about your business and what makes your product/service unique?

Mansfield: Powerphase manufactures an innovative High Efficiency Incremental Power Technology called TurboPhase. This technology enables users of Gas Turbine Technology to both increase the power output of their GT’s as well as efficiency, at the lowest cost of generation currently available in the market.

Mansfield speaks at the PWG Energy Day in January 2018, at the Ministry of Energy.

Mansfield speaks at the PWG Energy Day in January 2018, at the Ministry of Energy.

ITA: How do you see Asia affecting your business in the future?

Mansfield: Asia is without doubt the most significant contributor to global development for the foreseeable future. With countries like Indonesia, Vietnam & Thailand on constant expansion into industrial markets, and with the development of renewable generation, this market will need products like ours to ensure stability of generation, now and in the future.

ITA: What was uniquely useful about the Indonesia Power Working Group?

Mansfield: To put it simply, access to the decision makers and policy makers. To change the way a country approaches its electricity solutions on a macro scale requires both. The PWG is the only method to achieve this.

ITA: Why do you work with ITA? And/or How has ITA already helped you in Asia?

Mansfield: The ITA is a one stop shop to access the market. With a limited team based in Asia, having open access to the decision makers and policy makers is critical. The ITA have additionally supported driving opportunities through to conclusion in a challenging political environment. A unique capability which every U.S. Company should consider for its foray into these challenging markets.

Please visit www.powerphase.com to see what exciting projects they are working on thanks to the help of the ITA.

ITA is proud to connect U.S. companies to opportunities in the Indo-Pacific region. If you are interested in how ITA can help you access Asian markets, contact your local International Trade Specialist.

 

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AES: Reaching Business Opportunities in Vietnam

August 29, 2018

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

This is the second entry in a series of guest blogs highlighting ITA activities that help connect U.S. companies to opportunities in the Indo-Pacific region following the recent Indo-Pacific Business Forum where Secretary Ross, Secretary Pompeo and other cabinet officials spoke about the Administration’s commitment to the region.

Click here to read the first entry of our Indo-Pacific blog series.

Guest Blog Q & A with David Stone, President – Vietnam, AES, on ITA’s Vietnam Energy Working Group

 ITA: Tell us about your business and what makes your product/service unique?

Stone: AES is the first independent power producer to reach successful financial closure in Vietnam since 2003, with a total financing of approximately $1.46 billion. The company has been investing in Vietnam since 2010 and successfully developed, built, and currently operates the 1,240 MW Mong Duong 2 BOT Power Project in Quang Ninh province. The project was completed with an award-winning safety record, on budget, and ahead of schedule. The plant is expected to generate up to 7.6 billion kilowatt hours of electricity annually.

AES is looking at other business opportunities in Vietnam including renewable energy and natural gas power generation. AES signed an MOU on November 12, 2017, in the presence of Vietnam President Tran Dai Quang and United States President Donald Trump. This MOU is a critical milestone, expressing the commitment of both PetroVietnam Gas Joint Stock Corporation (PV Gas) and AES to jointly develop the Son My LNG Terminal Project, with a partnership structure of 51 percent and 49 percent for PV Gas and AES respectively. This marks another milestone in the historic partnership and strong collaboration towards mutual economic development between Vietnam and the United States.

In addition to Son My LNG Terminal Project, AES has also expressed interest in investing in the Son My 2 CCGT Project, which will not only create jobs in Vietnam and in the United States through exports of equipment to Vietnam,but could substantially contribute to the bilateral trade and investment relationship between the two countries. The Son My LNG Terminal Project and Son My 2 CCGT Project may pave the way to increased long-lasting economic ties that would benefit both countries, and further increase the visibility of Vietnam in the US and vice versa.

ITA: How do you see Asia affecting your business in the future?

Stone: AES’s mission is improving lives by accelerating a safer and greener energy future. We strongly believe that Asia should be part of the transition to CO2 free energy production and we work in this direction committing to different projects in the region that will bring it to a new level of energy production and consumption.

ITA: What was uniquely useful about the Vietnam Energy Industry Group?

Stone: In the rapidly changing global environment the dialogue and exchange of ideas is the engine that drives the economies further. That is why we are happy that the newly-formed US-Vietnam Energy Industry Group has been able to create an energy forum and that facilitates dialogue to help business communities have the chance to discuss ideas with the local and national authorities of Vietnam, generating plans for economic development of the country.

ITA: Why do you work with ITA? And/or How has ITA already helped you in Asia?

Stone: ITA is a valuable partner that helps us to strengthen the dialogue between the business and the authorities in different country. The fruitful dialogue with our key stakeholders is essential for the development of our ideas reflecting the needs of the local societies. In Vietnam we work with the Embassy and Department of Commerce to provide to the Government of Vietnam messages to reinforce AES commitments as well as request for a thorough consideration from the Government to ensure a fair business.

ITA is proud to connect U.S. companies to opportunities in the Indo-Pacific region. If you are interested in how ITA can help you access Asian markets, contact your local International Trade Specialist