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– November 2012

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Cover Story

No Boundaries

When it comes to physically demarcated free trade zones, look to Singapore or Hong Kong as shining examples. Or look to eastern China, where boundaried zones have proliferated. The Republic of Korea’s internal competition among zones has led to several excellent models such as the Incheon Free Economic Zone and the Gwangyang Free Economic Zone. Vietnam’s burgeoning roster of zones is also engaged in healthy competition. The argument for special economic zones (or SEZs) is hard to refute.

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Features

Next Year’s Model

Site Selection tally of automotive sector facility projects beyond NAFTA since January 2011 shows China, India, the U.K. and Brazil leading the way, followed by the Slovak Republic, Germany and Romania. The rankings line up nearly one for one with KPMG’s “Competitive Alternatives” rankings of national business tax climates, released in October. But there are a lot more factors than tax schemes at work.

Drawing a Crowd

Each November in Dusseldorf, Germany, more than 135,000 visitors from more than 100 countries attend Medica, the world’s largest gathering for the medical industry. That sea of participants includes an array of state agencies from the U.S. seeking new business for existing companies and recruiting investment from firms based around the globe.

Foreign Pipeline

Honda likes Ohio. Since November 2010, the company has announced investments totaling more than US$500 million in operations at its two auto plants and two powertrain plants in the state. Ron Lietzke, a spokesman for Honda in the U.S., says the investment is about strengthening the companies operations in Ohio and implementing new technologies.

The Thrill of Victory

Airbus adds Mobile, Ala., to its global network of passenger aircraft assembly plants, adding velocity to the northern Gulf Coast’s aerospace sector. On July 2, 2012 Airbus announced that the Brookley Aeroplex on Mobile Bay would be the site of the European aerospace giant’s newest final assembly plant — and its first in the United States — for production of the A320 family of passenger aircraft.

Return on Investment

To accurately measure an incentive’s results, states need to consider whether businesses receiving benefits would have made the same investments had the tax break not existed. When the Minnesota Legislative Auditor’s office studied the state’s Job Opportunity Building Zones program, for example, it found that about 80 percent of the jobs created by companies receiving incentives would have been created even without the help.

Please Don’t Go

As the global economy struggles to recover from the worst recession in recent memory, persistent high unemployment and low investment have begun to redefine the way economic development policy makers think about employment goals. The simple but harsh math of economic development starts with a basic premise: There can be no job growth before first retaining existing employment.

Competition Is Fun

North Carolina’s combination of work-force availability and skill sets of interest to employers, proactive business-development agencies, logistics assets and higher education infrastructure helped it reclaim Site Selection’s Top Business Climate spot from rival Texas

Investment Profiles

The Headquarters City

From financial services and insurance firms to retailers and restaurants, Columbus, Ohio, provides a safe haven for corporate management. Jeff Lyttle, region executive for JP Morgan Chase, says the global financial services firm has found the business climate it prefers in Columbus.

Tempting Thailand

Fifteen years after the Thai government shrewdly relaxed monetary policy and allowed its currency, the baht, to drop against the dollar, corporations investing in Thailand are reaping the benefits, accessing a low-cost and educated work force at the crossroads of Asia.

The Sweet Spot for Global Trade

International intermodal logistics center offers promise of ‘game-changing’ industry for Florida’s Heartland. If business leaders and economic developers in Florida’s Heartland have their way, the region will also become known as the sweet spot for global logistics, manufacturing and international trade.

Exceeding Expectations

Companies seeking a high-tech manufacturing location in Germany can drastically shorten their search now that First Solar’s site is becoming available in Frankfurt (Oder), on the Polish border.

Follow the Leader

Malaysia has long been a haven for high-tech companies, with several maintaining operations there for decades. They are staying in Malaysia to take advantage of the country’s forward-thinking approach to keeping these companies from relocating elsewhere in the region.

Room to Grow

The High Desert region of San Bernardino County is proving to be an oasis of business opportunity for companies seeking to expand their manufacturing and distribution operations in Southern California.

International

Well Connected

Pick your mode of transport. By any measure, North Rhine-Westphalia (NRW) is Germany’s most connected federal state — to the rest of Germany, to Europe and to the world.

Open Arms

Ernst & Young’s 2012 attractiveness survey found that Germany is the sixth most attractive country in the entire world for investment, and the first by far in Europe. Just as attractive is its global reputation for industrial ingenuity, from top-shelf automotive and high-tech machinery manufacturing to the latest techniques in tracking the carbon footprint of that activity.

Fortress Toronto

Canada’s largest financial center is climbing global rankings thanks in part to a unique and healthy dialogue between regulators and the regulated.

Departments

Location Branding: How to Measure A Nation’s Image

NASA’s space program contributed to countless inventions, including the lithium battery, the artificial heart pump and even the cordless vacuum. It also helped to demonstrate America’s technological prowess to the world — an element that contributes in building the U.S.

Red Hot Locations Report: Seminar Puts a Finer Point on Marketing and Communications for Investment Promotion Agencies

How can investment promotion agencies differentiate themselves from their competitors? What tools can they use — should they use — to achieve this goal? What are considered best practices today in communicating to potential investors an area’s strategic value? These were among the topics covered in a September Red Hot Locations event in London, the FDI International Marketing & Communications Seminar.

Area Spotlights

A Good Mix

A beneficial tax climate helps grow Washington’s diverse economy.

Patchwork Precision

Johnson County encompasses 20 municipalities, with Overland Park and Lenexa leading the way in recent corporate facility development. The county itself has no economic development agency. What it does have is a reputation for wealth, and for a wealth of education excellence.

Consortium Bets on a Solar Sector Surge

A high-tech cluster adds solar device innovation to its roster. Development of new solar energy technologies figures to be a major driver in the economy of Upstate New York in the coming years.

Opening In Omaha

Gavilon, TPG lead a new wave of companies expanding in Nebraska. The search for a new corporate headquarters home for grain and commodity trading firm Gavilon didn’t take long. America’s 19th largest private company found exactly what it wanted in its hometown of Omaha, Neb.

Coastline View

Projects up and down the seaboard help companies look outward and inward all at once.

Back to School

Business builders find the knowledge capital they need in college towns in the Southwest. Across New Mexico, Nevada and Arizona, entrepreneurs are tapping into this base of knowledge capital to propel their companies into rapid growth.

A Surplus of Riches

Montana ended the last fiscal year on June 30 with more than $453 million in surplus funds, the second highest amount in state government history.

Ohio River Corridor

Site Selection’s annual examination of corporate facility projects locating over an 18-month period in counties abutting the Ohio River found 301 projects that cumulatively accounted for more than US$8.1 billion in corporate investment between July 2011 and August 2012.