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The New International Economy Starts Here
by CLAIRE HERVEY
Foreign investors and U.S.
exporters find a beneficial,
no-cost partner in the InvestCA team.
W
hen it comes to international trade and investment, California has unbeatable resources.
California is the center of the brisk international commerce flowing into and out of the United States. Exporting 15.5 percent of the U.S. total and drawing 10.6 percent, or US$92 billion, in foreign investment, California is certainly the most international economy in the union.
This thriving internationalization has been a key contributor to the state's phenomenal economic growth over the last decade. Continued and enhanced commitment to internationalization by both businesses and the public sector gives strong indications that the growth trend will continue.
Why California?
California's $1 trillion economy is the seventh largest in the world. It surpasses all other U.S. states in trade and development. California leads the nation in direct foreign investment, exports, venture capital attraction, tourism and industrial research. In fact, foreign trade and investment accounted for fully one-fourth of the state's revenues last year, and supported one in every seven California jobs.
California is also the largest and most diverse state in the nation. With 36 million people, including immigrants from more than 100 countries, and the state's multicultural strength has important implications for the economy. California's diversity means stronger and broader trading links, incentives for foreign investors to have ethnic or national communities to locate to, and access to global knowledge.
California is one of the most popular places for international business not only because of its world-class work force, but also because of its impressive financial resources, infrastructure, utilities, educational system, natural resources, and commitment to research and development. And California's extensive variety of enterprises makes the state's business-to-business market one of the nation's most sophisticated. Makers of everything from aircraft to applesauce, computers to clothing, or electronics to enzymes can find virtually any component they need from a California source.
California Is an Open
Trade comes easy to California. Its $107.4 billion in exports last year led the nation, constituting 15.5 percent of the U.S. total. Mexico ranks at the top of California's long list of trading partners, and NAFTA has been a definitive success for this border state. Japan follows closely behind, as does Canada, each buying about 14 percent of California's total exports. The striking examples, however, are the regions: Asia as a whole buys more than 45 percent of California's exports, and the European Union about 24 percent.
The U.S. Agricultural Trade officer in Japan introduced NRE to Lundberg Family Farms, growers of a wide array of rice in Northern California, including organic varieties, and suggested the two companies join forces to produce the bento meals in California. The trade officer contacted the California Trade and Commerce Agency's (TCA) office in Japan, which in turn worked closely with its Office of Foreign Investment (OFI) in California, the foreign investment component of InvestCA. Working closely with regional economic development organizations, OFI assisted with the site selection and detailed regional information to help the new company find an appropriate location, which turned out to be the Solano Business Park. The TCA secretary participated at the new company's grand opening in May 2000 at Sacramento's Railroad Museum.
NRE World Bento found Fairfield to be a convenient and cost-effective location near its source of both ingredients and packaging components. The company's products will be produced, flash frozen and exported to Japan, where they will be microwave-heated and sold to consumers through kiosks along Japan's railway system. -- Claire Hervey
The state's network of 11 overseas offices works within the foreign markets to help facilitate exports and investment by providing one-on-one assistance to California companies as well as potential investors and buyers.
The vibrant, diversified economy combines with an excellent port system to support California's export dominance. Three of North America's four largest container ports are located in California, accounting for 35 percent of total U.S. container port activity.
The Los Angeles area boasts the third largest port system in the world, and the leading customs district in the nation. In March 2000, the Port of Los Angeles completed the first stage of the new Pier 400 terminal. At 484 acres (196 hectares), the new $488 million container terminal will be the largest proprietary facility of its kind in the world, representing a $2 billion commitment to the port over the course of 25 years.
This complex will link directly to the Alameda Corridor, a new $2.4 billion, 20-mile (32 km.) long cargo expressway connecting the port to the transcontinental rail hub near downtown Los Angeles. This integrated system will be ready for cargo operations in early 2002.
Other ports remain busy across the state in San Diego, Long Beach, Point Hueneme, Oakland, Stockton, Sacramento, Humboldt, Richmond, Redwood City and San Francisco. California's other trade resources include 14 foreign trade zones across the state, which allow special customs considerations, including duty-free, value-added re-export advantages. The state also provides free export resources, including counseling, trade leads, domestic and overseas trade show pavilions, procurement assistance and export financing.
California Assists Foreign
California is not just an international gateway for goods and services, however. It is also a prime gateway for international investment, and the state aims to help foreign investors feel at home. The California Trade and Commerce Agency's Investment Assistance Programs, called InvestCA for short, help prospective investors through a process that is comprehensive, confidential, fast and free.
Below are the five distinct phases of an investment,and how InvestCA assists investors.
After expressing an interest, the client will complete a confidential site selection worksheet that outlines his needs, indicating such variables as: type of facility, size, region/city, price, weather, national/ethnic communities, housing, labor force, local education systems (K-12 and universities), supply chains, financing, foreign trade zones and transportation infrastructure.
InvestCA then identifies potential regions and extends a request for proposals to all relevant regions, using the Team California network. Proposals outlining specific opportunities and incentives as well as potential sites are returned to InvestCA and then consolidated, organized, packaged and sent to the client or client representative for review.
The InvestCA professional then makes arrangements for the client to tour the sites, coordinating with local representatives. An InvestCA professional is available to conduct statewide site tours with the client. If an ideal site is found, selection and purchase can begin immediately.
Sometimes the first attempt at locating the ideal site becomes an instructional experience. If an ideal site is not available in the first effort, the company can return to InvestCA to tighten or alter its selection variables, and phases 1 and 2 are repeated until the company finds a suitable site.
For more information, InvestCA can be contacted via phone or email. For general inquiries, call (916) 327-2723 or email Locate@commerce.ca.gov. For specific information or assistance in foreign investment matters, call (916) 322-3518 or e-mail at ofi@commerce.ca.gov.
--Claire Hervey is the director of international
©2000 Conway Data, Inc. All rights reserved. SiteNet data is from many sources and is not warranted to be accurate or current.
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