Transcript Document

ATTRACTING INVESTMENT
AND RE-INVESTMENT:
MAXIMIZING PARTNERSHIPS & OPPORTUNITIES
#PEDAspring15
@investPA
@myPEDA
OFFICE OF INTERNATIONAL BUSINESS DEVELOPMENT
With the largest network of overseas offices of any
state in the U.S., Pennsylvania’s Office of International
Business Development (OIBD) is committed to
supporting Pennsylvania companies by working with
them to increase their export sales
and encouraging foreign companies
to invest in Pennsylvania.
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OFFICE OF INTERNATIONAL BUSINESS DEVELOPMENT
PA Authorized International Representatives
25 offices covering 55 countries around the world
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OFFICE OF INTERNATIONAL BUSINESS DEVELOPMENT
Objectives of PA Authorized Investment Representatives
• Prospective investors identified/tracked
• Business retention meetings
• Performance-based compensation based on:
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Site visits to Pennsylvania
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Completed projects
• Marketing of Pennsylvania:
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Investment seminars and events
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Direct Mail Campaigns
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Special activities and visits from Pennsylvania delegations/businesses
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OFFICE OF INTERNATIONAL BUSINESS DEVELOPMENT
Pennsylvania’s Assets
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Stable Economy
Large, growing and diverse economy
Comprehensive Infrastructure
Transportation, water resource, energy
Strategic Location
Central to U.S and Canadian businesses and consumers
Modern Workforce
Well-educated, highly skilled
Diversified Industries
Highly diversified with a strong manufacturing base
World-class Education
Hundreds of world-class institutions of higher education
Game-changing Resources
Supply and demand, Marcellus Shale, manufacturing
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OFFICE OF INTERNATIONAL BUSINESS DEVELOPMENT
FDI Trends for PA – Reasons
• Proximity to markets or customers
• Skilled workforce availability
• Domestic Market Growth Potential
• Government support
• Infrastructure and logistics
Source: FDI Markets database, Dec. 2014
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OFFICE OF INTERNATIONAL BUSINESS DEVELOPMENT
We are the 22nd Largest Economy in the World
Pennsylvania’s Gross State Product - USD $603.87 billion
USD $2,734.9
billion
USD $603.8
billion
USD $517.5
billion
USD $330.6
billion
France
Pennsylvania
Source: World Development Indicators Database, World Bank, Sept 2014
Source: U.S. Bureau of Economic Analysis, 2010 GDP by State, 2014
Poland
Denmark
USD $291.3
billion
Israel
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OFFICE OF INTERNATIONAL BUSINESS DEVELOPMENT
Investment Services Include:
Aiding companies in setting up US entities
Providing information on Pennsylvania’s labor, average wages,
business tax structure and more
Coordinating site and building searches with regional partners
Work with the Governor’s Action Team to vet projects for
business assistance programs
Networking with potential partners, including:
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Suppliers
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Colleges and universities
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Law firms
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Accounting firms
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Banks
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Real estate professionals
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Construction and engineering firms
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OFFICE OF INTERNATIONAL BUSINESS DEVELOPMENT
FDI Impact
• 6,450 foreign-owned business locations in PA*
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23%
Manufacturing
companies
275235 PA jobs supported by foreign firms*
• Of those, 1,457 are manufacturing companies*
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140,402 PA manufacturing jobs*
77% other
insourced
companies
• 4th largest state in the U.S. in number of workers
employed by majority-owned foreign-owned affiliates
• Pennsylvania is ranked
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5th for in-sourced manufacturing jobs
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4th for in-sourced research and design jobs
*Source: Dun & Bradstreet, Dec 2014, at least 50% foreign owned
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OFFICE OF INTERNATIONAL BUSINESS DEVELOPMENT
World FDI Trends
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The U.S. continues to be the
world’s top destination
country measured by
number of jobs created by
FDI, with a growth of 6%
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Japan and Germany
maintain their positions as the
second and third largest
origin countries for FDI
globally, with UK and France
at 4th and 5th respectively.
Source: IBM, “Global Location Trends, 2014 Annual Report”
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OFFICE OF INTERNATIONAL BUSINESS DEVELOPMENT
PA FDI Trends
• Pennsylvania had a 6%
increase in FDI over the
previous year
• PA ranks 14th in the US for
FDI projects
Source: FDI Markets database, data 2003-2014, Dec, 2014
FDI to PA (2003-2014)
No. of Projects
Total Job creation
339
29,335
Average project size
(jobs)
86
Total Capital
Investment (Capex)
$12.17 b
Average project size
(capex)
$35.90 m
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OFFICE OF INTERNATIONAL BUSINESS DEVELOPMENT
FDI Trends for PA – Source Markets
Source: FDI Markets database, Dec. 2014
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OFFICE OF INTERNATIONAL BUSINESS DEVELOPMENT
FDI Trends - Industry
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Transportation equipment remains the largest sector for FDI
measured by the number of jobs, accounting for 18% of jobs
created from foreign investment in 2013.
Tourism has emerged as a key source for foreign investment in
recent years and is maintaining its position as the second
largest sector for foreign investment, while chemicals is third.
The life sciences sector no longer features among the top 10
sectors for foreign investment, after a decline of 25% in jobs
created globally.
Natural resource dependent sectors, such as minerals, metals,
agriculture and forestry all experienced significant declines,
with falls of 30% , 20% and 35%, respectively.
Source: IBM, “Global Location Trends, 2014 Annual Report”
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OFFICE OF INTERNATIONAL BUSINESS DEVELOPMENT
Re-Shoring
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China has in recent years experienced a significant decline in inward
production investment of 44 percent compared to 2010 levels, as
increasing costs and questions about quality deterred companies from
locating new or expanding facilities in the country.
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For production activities that are less labor intensive but are relatively
more sensitive to transportation costs, such as many of the production
activities in the transport equipment supply chains, the changing
operating conditions in China, coupled with improvements in conditions
closer to home markets, are resulting in some companies locating new
production facilities near or within their key markets.
Key beneficiaries of this development have been Mexico and
various U.S. states for the North American market.
Source: IBM, “Global Location Trends, 2014 Annual Report”
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OFFICE OF INTERNATIONAL BUSINESS DEVELOPMENT
Implications for Economic Development – Organizations should…
• Assess their location’s capabilities and competencies in areas of
growth, resulting in a wish to be closer to market or leverage the latest
technological improvements.
• emerging services
• competence centers
• new types of manufacturing facilities,
• Ensure that their locations align skills supply and demand in key target
sectors.
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OFFICE OF INTERNATIONAL BUSINESS DEVELOPMENT
Implications for Economic Development – Organizations should…
• Ensure that people obtain skills that are relevant for industries targeted
for growth.
• Review the performance of their organization (along with local
government, stakeholders, etc) to ensure that activities are aligned
with the wider economic development strategy.
• Widen the mandate beyond traditional investment promotion activities
to include cluster development, focusing on key target sectors and
clusters and involve a number of activities to foster innovation, skills
development, partnerships and entrepreneurship among indigenous
and foreign companies.
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OFFICE OF INTERNATIONAL BUSINESS DEVELOPMENT
Top 3 Issues for Economic Development –
International Affairs
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Export Promotion Programs
Despite exports being the bright spot of U.S. economic
recovery, only 1% of small businesses are exporting,
describing their greatest barrier as lack of information or
understanding. State international trade agencies are on
the front lines steering companies through the export
promotion process, from identifying opportunity in foreign
markets to assisting companies with export control
compliance. Exporting companies create good jobs and
boost state economies.
Source: Council of State Governments, Jan 2015
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OFFICE OF INTERNATIONAL BUSINESS DEVELOPMENT
Top 3 Issues for Economic Development –
International Affairs
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Attracting Foreign Direct Investment
The contributions to the U.S. economy by subsidiaries of
foreign companies were nearly double that of U.S.
companies in 2013. FDI is a proven catalyst for economic
growth and states are leading the charge attracting
international partners across the globe. Global trends
show the U.S. share of FDI stock is facing tough
competition from other regions, particularly the European
Union and developing nations.
Source: Council of State Governments, Jan 2015
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OFFICE OF INTERNATIONAL BUSINESS DEVELOPMENT
Top 3 Issues for Economic Development –
International Affairs
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International Trade Agreements
The U.S. is negotiating major agreements with the TransPacific and European Union regions. On completion,
these agreements will provide enhanced access to 39
new markets. States will be readying themselves for this
opportunity by providing resources to exporters and
preparing for challenges that may arise as a result of the
trade deals.
Source: Council of State Governments, Jan 2015
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OFFICE OF INTERNATIONAL BUSINESS DEVELOPMENT
David Briel
Executive Director, International Investment
Office of International Business Development
PA Department of Community and Economic Development
Commonwealth Keystone Building
400 North Street, 4th Floor
Harrisburg, PA 17120
717-720-7373
[email protected]
www.newpa.com/intl
@investPA
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The Importance of Foreign Direct Investment:
Opportunities for Pennsylvania
The Pennsylvania Economic Development Association
April 21, 2015
Rebecca Moudry
Acting Director, Investment Promotion & Facilitation
SelectUSA, U.S. Department of Commerce
© International Trade Administration 2015
@selectUSA
SelectUSA.gov
Business Investment in the United States
1. FDI Trends and the U.S. Economy and in Pennsylvania
2. SelectUSA: How the Federal Government Facilitates Business
Investment in the United States
3. Your Global Strategy
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SelectUSA
1. FDI Trends and the U.S. and State
Economy
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FDI Benefits the U.S. Economy
#1
22% of U.S. Exports
~6 million U.S. jobs
Average annual wage
$78,927
R&D Investments
The United States is the largest recipient of foreign direct
investment in the world.
In 2012, U.S. subsidiaries of foreign-owned firms accounted
for over 22 percent of all U.S. goods exports.
In 2012, subsidiaries employed 5.8 million U.S. workers.
In 2011, subsidiaries contributed $455 billion in wages to U.S.
employees
In 2012, subsidiaries invested $47.0 billion in research and
development in the United States
Sources: Bureau of Economic Analysis; UN Conference on Trade & Development
© International Trade Administration 2014
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Global FDI Trends
$25,000,000
In USD Millions
$25.5 Trillion
$20,000,000
U.S. Share of Global FDI Stock, 1980 - 2013
The U.S. share of global
FDI is declining.
$15,000,000
$10,000,000
$5,000,000
Rest of World
U.S. Stock
$0
1980 1981 1982 1983 1984 1985 1986 1987 1988 1989 1990 1991 1992 1993 1994 1995 1996 1997 1998 1999 2000 2001 2002 2003 2004 2005 2006 2007 2008 2009 2010 2011 2012 2013
45%
44.86%
40%
U.S. Share of Global FDI Inflows, 1980 – 2013
35%
30%
25.93%
25%
20%
12.92%
15%
10%
5%
0%
1980 1981 1982 1983 1984 1985 1986 1987 1988 1989 1990 1991 1992 1993 1994 1995 1996 1997 1998 1999 2000 2001 2002 2003 2004 2005 2006 2007 2008 2009 2010 2011 2012 2013
Currency displayed at market values. Source: UN Conference on Trade and Development, 2013
© International Trade Administration 2014
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U.S. FDI Trends
Top 15 FDI Stock Positions, 2013
10% | $280.5b
20% | $540.5b
10% | $278.3b
9% | $239.0b
2% | $ 48.6b
1% | $ 41.0.b
5% | $137.3b
1% | $32.9b
Largest Sources of FDI in the United States by 2013
Stock Position
% of total stock
Rank
Market
(2.76 trillion)
Million USD
1
United Kingdom
19.55%
540,489
2
Japan
12.45%
344,143
3
Canada
10.15%
280,536
4
Germany
10.07%
278,283
5
France
8.65%
238,977
6
Switzerland
5.07%
140,142
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Netherlands
4.97%
137,333
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Ireland
4.24%
117,090
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Spain
1.88%
52,085
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Australia
1.87%
51,709
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Sweden
1.76%
48,582
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Norway
1.48%
40,986
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Italy
1.39%
38,445
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Belgium
1.24%
34,260
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Mexico
1.19%
32,878
12% | $344.1b
5% | $140.1b
4% | $117.1b
2% | $52.1b
1% | $38.4b
1% | $34.3b
2% | $51.7b
Source: Department of Commerce, Bureau of Economic Analysis – FDI Position by Ultimate Beneficiary Owner, 2013
© International Trade Administration 2014
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U.S. FDI Trends
Top 15 FDI Growth Markets, 2013
34.6% | $23.8b
36.6% | $202.0m
20.8% | $140.1b
29.1% | $41.0b
18.9% | $2.0m
14.6% | $48.6b
41.5% | $8.0b
15.3% | $21.2b
29.3% | $11.0b
24.1% | $1.5b
21.7% | $31.5b
19.6% | $14.9b
15.6% | $5.2b
14.6% | $2.0b
14.3% | $3.6b
Note: Figures denote 5 year compound annual growth rate (2009-2013)
of the stock FDI position and the total stock of FDI in the United States
Source: Department of Commerce, Bureau of Economic Analysis – FDI by
Ultimate Beneficiary Owner
© International Trade Administration 2014
Fastest Growing Sources of FDI in the United States by
Compound Annual Growth Rate (CAGR) 2009-2013
2013 Stock
Rank
Market
million USD
CAGR
1
China
8,023
41.54%
2
Hungary
202
36.61%
3
Luxembourg
23,823
34.56%
4
India
11,040
29.34%
5
Norway
40,986
29.11%
6
Malaysia
1,540
24.11%
7
Korea, Republic of
31,520
21.72%
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Switzerland
140,142
20.83%
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Brazil
14,852
19.55%
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Malta
2
18.92%
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Venezuela
5,190
15.62%
12 United Arab Emirates
21,204
15.25%
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Sweden
48,582
14.64%
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Colombia
2,022
14.63%
15
South Africa
3,647
14.31%
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FDI in Pennsylvania
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FDI in Pennsylvania
In 2012, U.S. subsidiaries of foreign owned firms employed 275,300 workers in Pennsylvania,
with 111,000 workers in the manufacturing sector. The majority of FDI is from Western
Europe and Canada.
FDI into Pennsylvania by Major Industry
FDI Employment in Pennsylvania by
Market, 2012
United Kingdom…..20%
Germany…..14%
Other industries
Netherlands…..13%
Manufacturing
Japan…..8%
Professional
services
France…..8%
Canada…..7%
Real estate
Finance and
insurance
Information
Retail trade
Wholesale trade
Source: U.S. Bureau of Economic Analysis
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FDI in Pennsylvania
Since 2003, fDimarkets.com reports 347 global companies have announced investment projects in
Pennsylvania. If completed at announced levels, they represent more than $12.45 billion in capital
investment and creation of 29,400 jobs.
Why do foreign firms choose Pennsylvania?
Location Motives, Announced Projects 2003-Present
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20
Canada
4
15
10
5
0
Source: www.FDIMarkets.com
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SelectUSA
2. How the Federal Government
Facilitates Business Investment in the
United States
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About SelectUSA
SelectUSA’s mission is to promote and facilitate business investment in the United
States. It is housed in the U.S. Department of Commerce and represented by the
Commercial Service at U.S. Embassies and Consulates around the World.
SelectUSA is geographically neutral and represents the entire United States. It
upholds the U.S. open investment policy and performs uniquely federal functions.
Our Clients:
 U.S. States, Regions, and Localities
 Companies (investors)
SelectUSA Report:
Winning Business in the United States
http://selectusa.commerce.gov/fdi-reports
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SelectUSA Can Help
Key SelectUSA Services Offered to Companies and EDOs:
Information and Counseling: To offer strategic insights and subject-matter
expertise to companies and EDOs on business investment in the United States.
Ombudsman Assistance: for companies and EDOs with questions or concerns
about U.S. federal rules and regulations.
Advocacy: For EDOs facing international competition on investment projects
by engaging support from high-profile U.S. Government officials.
In-Market Investment Promotion Platform: Fee-based platforms EDOs use to
market their locations to targeted investor audiences. We offer facilitated
investment missions (FIMs) and organize Single Location Promotion (SLP)
programs.
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SelectUSA Services:
Information & Counseling
SelectUSA can assist communities:
 Identify and utilize resources
 Connect with colleagues in-market
 Develop in-market promotion events
 Implement a global strategy
www.fdibestpractice.org/
EDA Best Practices Case Studies
interactive tool
www.clustermapping.us
Cluster Mapping tool and registry
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SelectUSA Case Study:
Lufthansa
Washington, DC – April 10: Penny Pritzker,
Alejandro Garcia Padilla, August Wilhelm
Henningsen, and Peter Ammon attend a
signing ceremony for an agreement to create a
new Lufthansa Aviation Facility in Puerto Rico
at the German Ambassador Residence on April
10, 2014 in Washington, DC.
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A new aviation maintenance, repair and overhaul facility,
which will service short-haul and medium-haul aircraft.
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Expected to create up to 400 permanent jobs.
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With the support of Vice President Biden, the White
House National Economic Council, and the President’s
Task Force on Puerto Rico, the SelectUSA team worked
with the Puerto Rico team to offer Lufthansa information
and assistance from across federal agencies and
departments that not only assisted in making their
decision but demonstrated why the United States is the
top destination for foreign direct investment.
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SelectUSA Connections for U.S. States and Regions:
In Market Promotion
Single Location Promotion
• Tailor-made events developed collaboratively, promoting individual U.S.
jurisdictions as FDI destinations
• Promotion events or receptions, one-on-one meetings with investors and other
key partners
Facilitated Investment Missions
USFCS-led program that provides participating EDOs a suite of fee-base services
• Sector-based trade shows, participants receive competitive registration fees including
attendance at special events, booth space, translation services, schedule of meetings
and logistical assistance
• SelectUSA-organized events and Road Shows to multiple stops in one country or a
group of markets
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SelectUSA Services:
In-Market Promotion Programs*
Visit http://selectusa.commerce.gov/upcoming-events for details:
2015
 March 23-24:
Washington, DC – SelectUSA Investment Summit
 April 13-17:
Hannover – Hannover Messe
 May 4-7:
SelectUSA at Offshore Technology Conference
 May 12-14:
Mexico Road Show
 May 18-29:
Greater China Road Show
 May 19:
Spain Forum
 June 15-18:
SelectUSA at BIO 2015
 June 18-20:
SelectUSA at the International Franchise Expo
 October 26-28:
Aerospace FDI Exposition
 TBA:
Japan, Brazil, India, Nordics Road Shows
*Outreach Programs offer information and services to both firms and EDOs
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The 2015 SelectUSA Investment Summit
March 23-24, 2015
2,600+ attendees
1,300 Foreign Firm Participants led by 45 U.S. Ambassadors
Thank You, Pennsylvania!
Pennsylvania Dept. of Community and Economic Development (exhibitor)
Core PA Global (exhibitor)
Cambria County Economic Development Authority
City of Philadelphia,Commerce Department
Pittsburgh Regional Alliance
York County Economic Alliance
Innovation Collaborative
SelectUSA.gov
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SelectUSA
3. YOUR GLOBAL STRATEGY
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The Need for Strategy
What are your assets? What makes sense for your unique region?
 Outline the strengths and weaknesses in your investment climate
 Conduct a “Globalization Audit”
 Identify possible source markets and priority sectors for investment
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What comparative advantage exists for your region?
• Be realistic - Focus on a finite number of target sectors
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The Need for Strategy
Moving into Action: When you Go
 Know the decision making process for an investor
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What will they look for? What are their sticking points?
 Familiarize yourself with the markets you visit, and the industries and firms you
want to attract – be an expert
 Be the chief salesperson for your region, always from the perspective of the
investor
Implement Business Retention and Expansion Tools
 Prioritize Investor Care
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Quick response time to inquiries (some from SelectUSA)
Create a standardized framework for managing cases
Establish metrics to track clients, successes, and areas for improvement
Open communication with decision makers at the state and local levels
Be prepared and willing to handhold an investor throughout the process
 Always follow-up with Aftercare
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The Where and Why of Your Location
 Tactical introduction to your state, region, city
 What is your brand?
 Don’t go it alone! Partnerships are key
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What about Reshoring?
It is a reality, largely due to:
 Calculations of total operation costs
 Rising costs internationally
 A move to regional production and
distribution
 U.S. competitiveness in energy and input
costs
Canada 4
 A strong
export platform
Do you need a reshoring strategy?
www.acetool.commerce.gov
Covers the top reasons for investing and sourcing
in the U.S.
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Resources
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Country Fact Sheets
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Customized investment data, talking points
and investment overviews
•
Competitiveness of the U.S. economy
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Announced investments and investment
successes
•
POC with international specialists
Let Us Know How can we Help
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What are your target markets?
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Where are you planning activities?
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Are firms confronting challenges?
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Thank You
Rebecca Moudry
Acting Director, Investment Promotion & Facilitation
SelectUSA - U.S. Department of Commerce
+1-202-482-2612
[email protected]
Catherine Werner
Investment Specialist – Regional Portfolio Manager
SelectUSA - U.S. Department of Commerce
+1-202-482-6307
[email protected]
Follow @SelectUSA on Twitter |
© International Trade Administration 2015
Join us on LinkedIn
SelectUSA.gov
Seung-woo Song (Freelancer)
[email protected]
LOCATION
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5 major airports in 3 hours
2 hours to NY & 3 hours to D.C.
NY – Buyers & money (Information)
D.C. – Regulation (FDA / NIH) and information
EMPLOYMENT
• Easier for healthcare related employment
• There are many good universities, colleges
and institutes
• Lower salary burden than NY and D.C.
• Very good school districts (Good education for
children)
COST
• Buildings & rents are more reasonable than
NY and D.C.
• Housing price is lower
• General living costs are economic
SUPPORT FROM PA STATE
• Dedicated and detailed supports from
Pennsylvania state on foreign start-ups
• Helped family settlement well(This is one of the
most important facts but many overlooked.)
• David Briel helped us macro and micro. Many
overlooked to help family matters but family
matters more than job sometimes so when family
is happy then I can locate the company even
better. David found almost all my family needs to
locate the life here so I located two companies
very easy.
SUCCESS STORIES
• Osstem Implant
* Sales was USD 30 Mil last year (90 Jobs)
• Meta Biomed
* Sales was USD 8 Mil last year (8 jobs)
* More than 50% growth every year in
South America
* In preparation of manufacturing facility
Korea South
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Has 5,000 years old history
Capital City : Seoul
Population : 50 Million
Economy : 13th largest in the World
Located among China, Japan and Russia
First Female President
Famous Singer : Psy Kangnam Style
Korean Companies: Samsung, Hyundai, LG, Kia
Thank You
S.W Song
[email protected]