March 20, 2008
With Many Troubles at Home, U.S. Exports Carry the Economy
In addition to Georgia, the rest of the country needs to be rooting for growth in global markets; PPI explains why:
Posted by John at 3:34 PM | Comments (0) | TrackBackIn total, exports accounted for a third of last year's 2.2 percent GDP growth. As waves of bad news began to wash in last winter -- foreclosures, tumbling dollar, falling retail sales, more recently investment bank rescues -- exporters were the only thing keeping the national nose and lips above the recessionary waters. (The domestic economy shrank by -0.3 percent between October and December; export growth accounted for 0.9 growth; ergo, barely positive national 0.6 percent growth.)
Those searching for scarce good news can find some in January's trade report. This suggested another export-boom year ahead, with sales to China, Russia, Europe, and the Middle East all continuing to soar, while exports to Mexico, Canada, and Japan began to perk up. Interesting note as well: Last year's U.S.-Peru Free Trade Agreement entered into force in January, and exports to Peru hit $420 million, nearly double the $240 million for January 2007. Worsening news from the real estate, financial-market, and consumer sectors mean exporters may not be able to fend off a national recession this year. But their likely trio of round-number records -- $1 trillion in manufacturing exports, $500 billion in services exports, $100 billion in farm exports -- will ease its ferocity.
March 19, 2008
Georgia Shouts "How 'Bout Them Asians!"
University of Georgia Bulldog fans like to holler "how 'bout them Dawgs" when rooting for their athletic teams. All Georgians, regardless of their sports preferences, should be rooting for the Asian economies, particularly China.
More than three-fourths of the total import volume processed through the Port of Savannah during the current fiscal year arrived from Asia. Moreover, just over half of the total export volume during the same period was bound for Asia. [Source: Connect Savannah]
Remember, the overall economic impact Georgia's ports have on the state is enormous, and much of that volume is due to trade, both imports and exports, with Asia, and China in particular.
To say Georgia is a stakeholder in Asia's growth in a mild understatement.
Posted by John at 6:17 AM | Comments (0) | TrackBackAlabama Attracts U.S. Migration
Due to its strong economic performance, driven in part by its embrace of the opportunities of a global economy, Alabama has joined Southeastern neighbors Georgia, Tennessee, and North Carolina as a recipient of strong net migration. Net gains of out-of-staters moving to Alabama has tripled over the last three years. More from the Birmingham News.
Posted by John at 6:00 AM | Comments (0) | TrackBackMarch 16, 2008
Mobile Embraces Globalization . . . and Reaps the Benefits
Mobile, Alabama has become one of America's fastest growing small cities, and the Seattle Post-Intelligencer explains why:
Posted by John at 11:01 PM | Comments (0) | TrackBackHow did this happen? Mobile officials cite an embrace of globalization, an outpouring of Southern hospitality toward big business and an ability to put aside political differences at all levels of government.
. . . "Our target for recruitment is not just limited to the U.S.," [Mobile Mayor Sam] Jones said. "It's global."
As Mobile sheds an outdated backwater image, local perceptions are changing, too.
Mobile County Commissioner Stephen Nodine said that until recently, he was skeptical of free trade. "I've always been a buy-American person," he said. "I was closed-minded about how global of an economy that we live in. Within the defense industry, everything is global."
Now, the Republican leader finds himself welcoming foreign corporations. "I keep reminding people," Nodine said of the French and the Spanish, "they're the ones who founded Mobile 300-something years ago." . . .
February 25, 2008
Georgia's "China Decade"
Tomorrow, the Georgia-China Alliance celebrates the fourth "China Day" at the State Capitol. In a relatively short period of time, Georgia's ties with China have multiplied rapidly, as I expressed in an editorial in this week's issue of the Atlanta Business Chronicle:
This week, thanks to a joint resolution sponsored by Sen. Judson Hill and Rep. Charlice Byrd, we will be celebrating “China Day” at the State Capitol. Georgia’s relationship with China has come a long way very quickly.
About four years ago, a State Senate Committee led by Sen. Sam Zamarripa conducted research on Georgia’s relationship with China to determine how our ties could be enhanced. Since this study (pdf) was done, Georgia’s Chinese connections have flourished, thanks to the efforts of both private and public sector individuals too numerous to name. While celebrating “China Day” again this year, we Georgians are really in the midst of celebrating “The China Decade”.
In 2001, China trailed the Netherlands and Brazil as Georgia’s eighth largest trading partner. According to the latest available data, Georgia’s exports to China have mushroomed to $1.1 billion, a 23% compound annual growth. China is now Georgia’s third largest export market, ahead of the United Kingdom, Japan, or Germany.
Georgia is a Southeastern leader in attracting Chinese business; we have several different Chinese companies in various stages of constructing facilities here. Imports from China are the principal reason Savannah is America’s fastest growing port.
Despite this progress, our relationship with China still has remarkable unrealized potential. We must press our federal officials to clear the way for China to locate its next U.S. consulate in Atlanta. As has been the case with Houston, a Chinese consulate in Georgia would plant our state in the sights of many more Chinese businesses contemplating a U.S. location than would otherwise be the case.
With disposable income in China rising quickly, our state should commit funds which promote Georgia to Chinese tourists looking at potential U.S. destinations. Those tourists can’t get here, however, without visas granted by the U.S. government. Consequently, we must press our Washington representatives to overhaul and streamline the visa approval process for both tourists and businesspeople.
While the growth in our state’s relationship with China has been dramatic and profitable, we have much more work ahead of us to fully realize the potential of our “China Decade”.
My friend Kathe Falls, Director of International Trade at the Georgia Department of Economic Development, was nice enough to get me the 2007 trade statistics, which she has faster access to than I do. Trade statistics for 2007 reveal that China is now in second place on Georgia's list of export markets, behind only Canada. Exports to China from Georgia grew by 26% in 2007. That's really big news, and further indication of the rapidly growing Georgia-China relationship.
Posted by John at 10:20 AM | Comments (0) | TrackBackFebruary 13, 2008
Hispanic Chamber of Commerce Being Formed in Brunswick, Georgia
The Hispanic business community in Brunswick, Georgia appears to be mature enough to justify the creation and support of an Hispanic Chamber of Commerce. Read the complete story here.
Posted by John at 9:55 AM | Comments (0) | TrackBackNovember 4, 2007
Where Would Arkansas Be Without Immigrants?
. . . Between 2000 and 2005 Arkansas had the country's fastest-growing Hispanic population, native and foreign-born. The Census Bureau projects an Arkansas population of nearly 3m in 2010, of which 6% will live in immigrant households. Realising a need, Mexico opened a diplomatic office in downtown Little Rock in the spring.
Of Arkansas's immigrants, 60% (the national average is 54%) are aged between 20 and 45. Their youth suggests that, even more than elsewhere, they may replace retiring baby-boomers in the workforce. Lack of higher education keeps them out of the better-paying jobs, but a report by the Winthrop Rockefeller Foundation estimates that without immigrant labour, annual revenue from Arkansas's manufacturing industry would probably be $1.4 billion lower. . . .
Arkansas's gross state product, for comparison, was an estimated $87 billion in 2005.
Posted by John at 8:47 AM | Comments (0) | TrackBackOctober 28, 2007
Governor Bredesen on China's "Audacity" and Skirting the Edge of Opportunities
Tennessee Gov. Phil Bredesen, fresh from leading a state trade mission to China, reflects on his trip in a Nashville Tennessean commentary:
First, an insight about America: The Chinese are willing to do big things; we need to rediscover that audacity here at home. I've felt for a long time that we confine ourselves far too much to frittering around the edges of opportunities — in infrastructure, in transportation, in health care. This trip has crystallized this feeling. Hong Kong has 7 million people, a little larger than Tennessee; I flew out of a new Hong Kong airport this morning that cost $8 billion to construct. Can you even imagine an $8 billion public infrastructure project in Tennessee? With even bigger ones on the drawing boards?
Posted by John at 12:18 PM | Comments (0) | TrackBackSecond, China is enormous; 1.3 billion people is a quarter of the world. The refrain repeated over and over by our Tennesseans: "You just have to see it to believe it." There are cities in China you've never heard of that are bigger than any city in the U.S. And with that size, there is an astonishing amount of money in China. Shanghai defies description. A lot of what is going on right now has to be a dot-com-like bubble — but it's the underlying wealth to buy these assets that is the real story, and that wealth is definitely there and growing exponentially. China is having its coming-out party.
Third, the political system in China is unique and defies labels. It's not the gray communism that I knew in the 1970s in Eastern Europe; it's not Western-style capitalism either. My best one sentence description would be, "A one-party capitalist country with no Bill of Rights."
We can compete economically just fine with that system, but only with very clear-eyed study of how it really works and not through some ideological prism.
And fourth, we need to work hard to open more doors to China. I want more trade missions, and I especially want more Chinese students here and more American students to go to China. For the past century, America has been the higher education destination of choice in the world. After 9/11 and the massive visa restrictions that were put in place, Chinese students looked elsewhere. Places like Australia and parts of Europe are now where many of them go. We lost an invaluable franchise, and we need to regain it.
I already know that this trip will be a business success for Tennessee; how many eyes got opened is even more important. I believe that once we come to understand the gravity of the challenge to us, America will compete just fine. Open and free societies can adapt and change better than any competitor.
But I also came to believe this past week that we need to actually use that freedom to do some thinking and to do some planning; resting on our considerable laurels is a prescription for our kids to raise theirs in the China Century.
October 23, 2007
Here's the Part of the Water Shortage Problem Almost Never Mentioned
. . . water remains a consumer's cheapest utility, with bills averaging $25 per month across the country, and sewage $20, compared with $60 to $100 per month for cell-phone service, notes Francesca McCann, water industry analyst for Houston-based Stanford Group Co. That has created a false sense of the resource as being low in value, she says, and will make it hard to come up with the half-trillion dollars the Environmental Protection Agency estimates will be needed in drinking water and sewage upgrades nationwide over the next 20 years.
Georgia is no different than Arizona and other states with water challenges: low, non-market prices for water are never mentioned by politicians or the media as a cause of our predicament.
In fact, it may be the biggest part of the problem. Cheap water is regarded as a right, not a privilege, and that's the root cause of any shortage.
The price of any good or service determines its demand; that's basic economics which my nine year old daughter understands. When water bills are one of the most inexpensive aspects of running a household or a business, it's easy to understand why conservation efforts, imposed by government by force, are largely a failure.
Posted by John at 6:21 AM | Comments (0) | TrackBackOctober 20, 2007
Tennessee Promotes Tourism . . . in Spanish
For the first time, Tennessee's department of tourism has begun advertising in Spanish-language newspapers. A Spanish version of its website will be unveiled by the end of October. [Source: USA Today] Incidentally, a German version of the site is already available.
Here in Georgia, the state's tourism website is English-only, and presumably proud of it.
Posted by John at 7:26 AM | Comments (0) | TrackBackOctober 15, 2007
Building the Atlanta Brand
My partner Sam Zamarripa penned a tremendous editorial on the "Atlanta brand", why it matters, and how to build it to the benefit of the entire state:
Cities are the most important and recognizable brands in the world. More than consumer brands, states, provinces and even countries, cities dominate the global mindshare of brands. You may want to go to France, but Paris is the destination. No one travels to New York State, it's NYC. And so on.
We live in a city-region, "Atlanta," that is a "giga-brand." The Atlanta brand has been etched into the cellular membranes of billions of people. Atlanta is not just the name of a city; it is a biological plaque holder in the brains of the most important people in the world – economic, political and religious – and it is associated with powerful images, ideals and symbols. It is an economic brand of optimism and hope, with a social foundation for inclusion, tolerance and human rights. Atlanta is one of a few cities that dominate in this category.
For this reason, the Atlanta brand is the most important nonpeople asset in our state. It is pure gold, Olympic and otherwise. Competitor cities like Dallas, Richmond, Va., and even Miami would die to have the reach and depth of the Atlanta brand. They understand brand creation is painfully slow, expensive and illusive.
The great opportunity for Georgia is to leverage the Atlanta brand to accelerate economic growth, especially global expansion. Many of our leading corporations – UPS, Coca-Cola, Delta and Home Depot – are creating their growth and profits from international expansion. They are top global brands. When the value of these brands is associated with the value of the Atlanta brand, everyone wins. . . .
Read the rest of Sam's essay here; it's worth your time.
Posted by John at 6:02 AM | Comments (0) | TrackBackSeptember 26, 2007
Delta Receives an Atlanta-Shanghai Route
Delta Airlines was a winner in a number of new routes to China approved by the FAA. Beginning early next year, Delta will begin direct service from Atlanta to Shanghai. (See the story from Global Atlanta here.) Those of us who travel to China from Atlanta and the Southeast generally are delighted.
From the China side, having a direct flight to Atlanta highlights the city, the state of Georgia, and the Southeast in an extremely positive way. It will increase awareness among many in China for whom Atlanta might have seemed a distant consideration for business relative to New York, Los Angeles, or San Francisco.
Congratulations to Delta Airlines and the many advocates for this flight in Georgia and around the Southeast which helped make this happen. The fruits of their effort will be significant.
Posted by John at 10:35 PM | Comments (0) | TrackBackSeptember 24, 2007
Retiree Population to Mushroom in Georgia and the Sunbelt
Among large metropolitan areas, Atlanta's growth in pre-seniors (age 55-64) was the fourth fastest from 1990-2005, behind Las Vegas, Austin, and Raleigh, NC. Georgia, along with other Southern and Western states like Florida, Texas, and Nevada, are expected to see their numbers of retirees in 2030 to equal an amount about 2 1/2 times greater than that in 2000. [Source: New York Times]
Posted by John at 4:15 AM | Comments (0) | TrackBackSeptember 23, 2007
An Hispanic "Parallel Universe" in Memphis
The Commercial Appeal reports on the "parallel universe" in Memphis: the area's sizable Hispanic population and the economy and culture it has spawned, largely unrecognized by mainstream residents. The full story is here.
Posted by John at 8:34 AM | Comments (0) | TrackBackSeptember 14, 2007
Tough Times for Atlanta's Hispanic Business Community
. . .thanks to a lackluster residential construction market and new state immigration laws, which have even immigrants with legal status alarmed. The Atlanta Journal-Constitution reports:
. . . the fallout has spread far beyond car dealers, which immediately felt the impact from a law that went into effect on July 1 requiring a Georgia driver's license or ID card to get a car tag. It's affecting bakeries, insurance peddlers, banks, food manufacturers, supermarkets, restaurants and other businesses.
Why the slowdown in spending?
Tougher state and local laws that affect illegal immigrants and the lack of resolution over their status after the proposed immigration reform collapsed in Washington earlier this year have left many saving money, spending less and wondering what will happen next.
Add to this a slowdown in the housing market, which affects the job stability of a portion of the Hispanic work force in Georgia.
"This is like a double whammy," says UGA demographer Douglas Bachtel, who studies the Hispanic population. "Whenever there's anything new, there's fear and uncertainty, especially with the immigration status."
Nearly half of the Hispanic population in Georgia is undocumented, Bachtel explains. The census estimates there are 700,000 Hispanics in Georgia, but Bachtel says Hispanics are way undercounted.
"It's affecting all businesses," says Neil Moreno, who sells car insurance in a storefront next to Espinosa.
His business, which dropped by about 30 percent in July and August, now consists mostly of renewing auto insurance policies, not selling new ones. He can't afford to replace his assistant. On a recent morning, close to noon, he sat at his desk waiting for clients.
"This is dead," says Moreno, who is from Puerto Rico. "It's terrible. The phone's not ringing." . . .
Spending by Hispanics will grow at a slower rate in the next five years, says Jeffrey Humphreys, a University of Georgia economist. In 2006, Georgia Hispanics spent $12.4 billion, 10th in the nation, according to his research.
A study released last month by the Washington-based Inter-American Development Bank found that the percentage of Mexicans in "new destination" states who send remittances regularly to their homeland declined from an average of 80 percent in 2006 to 56 percent this year. "New destination states" are those where immigration from Latin America is most recent, such as Georgia, North Carolina and Pennsylvania.
States that have long had Hispanic communities, such as New York, Florida and California, showed a tinier fall, from 68 percent last year to 66 percent this year.
In the "new destination" states, about half a million migrants have stopped sending money home, according to the IDB study.
Miami-based public opinion researcher Sergio Bendixen, who carried out the survey, says that the Mexicans in states such as Georgia don't feel welcome and face an uncertain future.
"They feel alienated. They feel unprotected," Bendixen says.
His sample of 900 subjects included 100 from Georgia. Interview subjects said they felt abused, exploited and discriminated against. "People in states like Georgia don't want them there," Bendixen says.
"They'd never tried to close the doors so much, [as] in the case of the car tag, as they have now," said Zayda Zavala, 26, as she worked at La Suprema Bakery in Marietta. "People don't want to drive." . . .
You can read the complete AJC article here.
Posted by John at 5:29 PM | Comments (0) | TrackBackAugust 26, 2007
What the South Must Do to Succeed in a Globalized Economy
Dallas Federal Reserve Bank President and CEO Richard Fisher recently spoke to the Southern Governors Association on what Southern states must do to succeed in a globalized economy. The answer, says Fisher, is to invest in education:
There is no great secret about how to lay the groundwork for Southern states' success in harvesting and harnessing—in mastering—globalization. The key to adapting to and profiting from globalization lies in education. Texas boomed on the discovery of oil. Now we thrive on the output of the human mind. If you look around Dallas and Houston, you see office buildings, not oil wells or factories. Those buildings warehouse the capital plant of the modern era: human brains. Brains that research and provide services in medicine, marketing, finance and myriad other services. Oil wells eventually run dry. An educated mind never does.
Just as farming and oil and gas and manufacturing once propelled the development of the Southern states, an educated workforce with high earning potential will propel the future of your states, our great nation and the world. The ultimate source of competitive advantage for Texas is not oil and gas or the chemical industry or this widget or that or even the Dallas Cowboys or the San Antonio Spurs (even if they are the good Lord's favorite teams)—it is our elementary and secondary schools, and the University of Texas at Austin, Texas A&M in College Station, Rice University in Houston, Southwestern Medical and Southern Methodist University in Dallas, and our law and engineering schools and research centers. Each of you could say that for your states. The development of human capacity through education should be the highest policy priority of any government in the South or anywhere else.
When I ran for the Senate, I was told to make every effort to condense complex thoughts and ideas into simple catchall phrases. I obviously wasn't very good at it. And, as politicians yourselves, you know meaningful brevity is not an easy task. Nor one that everyone appreciates. Pundits deride the catchy line as "bumper sticker" politics. I am not running for anything, so I'll risk offering a bumper sticker for our times, one delivering this simple message: "You earn what you learn." . . .
You can find Fisher's speech in its entirety here.
Posted by John at 9:14 AM | Comments (0) | TrackBackJuly 24, 2007
When Georgia Resembles China
Headlines, in just the past few days, from the Atlanta Journal-Constitution:
"Canned chili sauce linked to botulism" (Augusta-based Castleberry's not only has some bad hot dog chili sauce on its hands, but a few days later the company expands its recall from 10 brands to 80, including not only chili but beef stew, corned beef hash, and other canned meat products.)
"Raw milk sickens three Georgia families" (Three families in Murray County become ill due to campylobacter present in unpasteurized milk sold by a farm which had labeled it as pet food.)
The two are not equivalent; food safety standards in China are markedly lower nationwide than they are in Georgia and the other 49 states. Let's not get too sanctimonious about it, though. Food-borne illness occurs everywhere, even under the best of conditions sometimes.
Posted by John at 4:12 AM | Comments (0) | TrackBackJuly 8, 2007
Sunbelt Migration Good for Longevity
Paul Kedrosky points to a study which asserts that 8%-15% of the total gains in life expectancy experienced by the US population over the past 30 years is attributable to migration from colder Northeastern states to the warmer Sunbelt.
Posted by John at 8:48 AM | Comments (0) | TrackBackJuly 2, 2007
Atlanta a Rising "Mecca" for the Creative Class
Fast Company lists the 30 Fastest Cities in the World, four of which are top "Creative Class Meccas": Shanghai, New York, San Francisco, and Buenos Aires.
Atlanta, along with Los Angeles and Mumbai, are Creative Class Meccas "on the verge", according to the magazine. My home city is in some terrific company.
Buenos Aires in this group? Our previous on the ground reports have hardly been glowing. Comments welcome (emailed).
June 23, 2007
Georgia's Gain, Florida's Loss, Thanks to Insurance Costs
The Atlanta Journal-Constitution reports on how the rising cost of insurance in Florida is the last straw for many residents who are moving to Georgia. Interesting fact: One-third of all buyers of Midtown Atlanta condos over age 55 are from Florida.
Posted by John at 3:53 AM | Comments (0) | TrackBackJune 21, 2007
Metro Atlanta Chamber One of the Nation's Best
Well-deserved congratulations go to the Metro Atlanta Chamber of Commerce, which has been selected one of the top economic development organizations in the country by Site Selection magazine. Criteria for the selection included job creation, new investment, innovation, and customer service.
I've had the pleasure of working with a variety of people at MACOC, and this group is talented, professional, hard working, and a delight to deal wtih. They do a great job representing this region, and they deserve all the accolades they get.
Posted by John at 6:56 AM | Comments (0) | TrackBackJune 7, 2007
A Great Profile on the Former "Buggy Whip Capital of the World"
Barnesville, Georgia once billed itself as the "Buggy Whip Capital of the World". It's now the proud home of one of the largest announced Chinese investments in the Southeast. The Macon Telegraph has a great profile of a terrific Georgia community.
Posted by John at 8:13 PM | Comments (0) | TrackBackJune 3, 2007
Ties With China Help Increase Jobs in Tennessee
So says Tennessee Governor Phil Bredesen, in a Nashville Tennessean commentary. Bredesen is leading a delegation to China in October, during which Tennessee's economic development office in Beijing will be formally opened. Thanks in large part to soybean and cotton exports, Tennessee's trade with China has increased 1,000% in five years.
Posted by John at 4:51 AM | Comments (0) | TrackBackMay 27, 2007
Atlanta "Chock Full of Entrepreneurs"
Jason Caplain and David Jones of Raleigh, NC-based Southern Capitol Ventures held a "Calling All Atlanta Entrepreneurs" session at the ATDC recently, looking for potential investments in young e-commerce, software, wireless, digital media and healthcare IT companies. In an interview with TechJournal South, they praised Atlanta's entrepreneurial milieu:
Atlanta is a great place to start a company! It is chock-full of entrepreneurs, bootstrapped companies, strong universities and has large Fortune 1000 technology companies.
There are some great venture funds and angel groups in Atlanta, but we agree with the entrepreneurial community that there is a lack of early stage capital in that market. That’s why we are taking a more active role in meeting with entrepreneurs there. . . .
It was a great mix of young, experienced and new entrepreneurs. It was slightly weighted towards the newer entrepreneurs which is a really positive sign for the Atlanta economy. . . .
By the way, Jason's Southeast VC blog is worth your regular attention.
Posted by John at 5:08 AM | Comments (0) | TrackBackEntrepreneurial Georgia
The 2006 Kauffman Index of Entrepreneurial Activity reveals that Georgia has one of the highest rates of entrepreneurial activity in the country. In 2006, Georgia had about 440 entrepreneurs for every 100,000 people, compared to 290 entrepreneurs per 100,000 population nationally. Only Montana (600 per 100,000 population) and Mississippi (520) ranked higher for 2006. Nationally, the entrepreneurial rate was about 290 per 100,000 population.
Among the top fifteen metropolitan areas, Metro Atlanta ranked second, edged out by Miami. In 2006, the Atlanta MSA had 490 entrepreneurs per 100,000 population, while Miami's entrepreneurial rate was 500 per 100,000.
The complete study can be downloaded here.
Posted by John at 4:25 AM | Comments (0) | TrackBackMay 20, 2007
Metro Atlanta's Underrecognized Asset
Thursday morning I heard Dennis Lockhart, newly installed President and CEO of the Atlanta Federal Reserve Bank, speak at a Metro Atlanta Chamber of Commerce gathering: Lockhart has recently came back to Atlanta twenty years after having lived in the city working as Citigroup's senior corporate officer in the Southeast.
Lockhart identified Atlanta's openness to its new citizens as one of the principal reasons for the region's tremendous growth over the past two decades, and went on to add:
". . . wariness of newcomers, whether they are foreigners or from this country, is a huge impediment to economic growth and development. . . I can't emphasize how important this is . . ."
Lockhart put his finger on arguably Metro Atlanta's most underrecognized asset for its economic performance. Many of us do not appreciate the importance to economic vitality of the new ideas and fresh thinking which newcomers bring. They bring more than their added incomes and spending power; their new perspectives are the source of new innovations, ways of doing business, and even new enterprises themselves which help any economy, including Metro Atlanta's, function at a higher level.
Posted by John at 7:26 AM | Comments (0) | TrackBackMay 16, 2007
Sights and Sounds of a Georgia-China Groundbreaking
Walter Geiger, editor of the Barnesville Herald-Gazette and the b-lc blog, pointed me to the following video, made by Barnesville's own Cleanup Kitty Productions. It's a very well done video montage of last Saturday's groundbreaking for General Protecht's Barnesville project:
May 15, 2007
Coming Up for Air After Planting a Chinese Company in Georgia
Regular followers of my blog have been disappointed (or possibly ecstatic) that the only Tidbits posts made in recent days have been the “Quote of the Day”. I've been in shutdown on writing just about anything due to our involvement in Georgia's largest Chinese investment to date, and one of the largest yet announced in the Southeast.
General Protecht Group, through its U.S. subsidiary General Protecht U.S., Inc., will making an initial $30 million investment in a new plant in Barnesville, Lamar County, Georgia. The new facility is slated to employ 240 by year two of operations. Future plans by General Protecht call for an investment of up to $100 million if all phases of the project are completed.
You can read the Atlanta Journal-Constitution accounts of this story here and here (caveat lector). The press release from Governor Sonny Perdue's office is reprinted here.
I will be posting more on this deal in coming days, and what it could mean in the future. I predicted something like this almost exactly a year ago, in an Atlanta Business Chronicle editorial, “It's Time to Ask for the Business---in Chinese”. This time next year? You can expect to see more announcements in Georgia and in other Southeastern states.
More on that later.
Posted by John at 11:08 PM | Comments (0) | TrackBackMay 5, 2007
Inc.'s Best Cities For Doing Business Heavily Sunbelt-Based
Inc. magazine offers its top cities for doing business, and a short look at an interactive map reveals that a Sunbelt location is a crucial aspect of ranking high in this survey. The Northeast has no representative at all among the highly ranked in either the large, medium, or small category.
Among the country's largest MSAs, Phoenix (14th overall), Riverside-San Bernardino-Ontario (26th), Washington (92nd), Houston (120th), Seattle (122nd) and Atlanta (151st) were the highest ranked.
I'm always interested in how the Sunbelt ranks in such surveys, being a Georgia resident, but I'm not sure this particular survey has much value beyond curiosity. It's methodology is based entirely upon various measures of employment growth, which is hardly the sole indicator of a city's receptivity for business.
Posted by John at 5:08 PM | Comments (0) | TrackBackApril 29, 2007
An "Ugly Correction" for Condos
Against ongoing uncertainty about deepening problems with subprime mortgages and what speculators who jumped into the housing market too late for a quick profit will decide to do, multifamily developers and analysts at the NAHB Pillars of the Industry multifamily conference in Hollywood, Fla. earlier this month agreed that condominiums in some of the formerly most overheated markets will be "in the doldrums" well into 2008.
"We’re in for a fairly ugly correction," said Ron Terwilliger, president of Atlanta-based multifamily developer Trammel Crow Residential. "It’s not that condominiums are just bad," he said, "for-sale housing is bad."
"Am I allowed to use negative numbers?" quipped Ara Hovnanian, president and CEO of New Jersey-based Hovnanian Enterprises, when asked to rate the housing market on a scale of one to 10.
As subprime and high-risk mortgage market lenders tighten their requirements, the condominium market will contract because fewer people will qualify and the specter of foreclosures, at least in the near term, will loom, said Ronald Ratner, president of the multifamily development, management and investment firm, Forest City Residential Group, based in Cleveland.
In most markets, foreclosures will register only as "a blip," said Ratner. But he added that the psychological effects from the subprime fallout could run much deeper, giving many prospective home buyers second thoughts. . . .
It will be interesting to see how the cycle plays out here in Atlanta, which seems only to be a little late in the condo boom cycle relative to Miami and southeast Florida, for example. The business press, seemingly every day, trumpets some new high-rise condo, mixed-use development, or condo/hotel project.
Atlanta's growth right now is phenomenal. At the same time, Miami's economic performance has been terrific as well, and condo demand simply could not keep up with the speed of developers. "Ugly correction" seem like an apt description of what could be brewing here.
Posted by John at 10:27 AM | Comments (0) | TrackBackApril 20, 2007
Southeastern Cities Continue to Draw African-Americans
Black Enterprise magazine has unveiled its most recent list of top cities for African-Americans in its May 2007 issue, and Washington is first, followed by Atlanta. In the last survey in 2004, Atlanta and Washington were first and second.
Atlanta, "home to 64,000 black-owned businesses", "continues to offer extensive entrepreneurial opportunities", according to Black Enterprise.
As with the last survey, eight of the top ten cities in the survey are in the South. (Birmingham and Memphis fell out, but were replaced by Raleigh-Durham and Jacksonville.)
Posted by John at 4:15 AM | Comments (0) | TrackBackApril 19, 2007
A New Category: Georgia and the Southeast
Since we post so often on development, demographic, and other trends in our home state of Georgia and the Southeast generally, we've created a new category on Georgia and the Southeast. To see posts for this new category follow this link.
Posted by John at 8:47 PM | Comments (0) | TrackBack
Banning Japanese Language Business Cards in Nashville
Nashville Mayor Phil Purcell explains the problem with English-only laws, and how they hinder economic development efforts for his city; Purcell just vetoed an English-only bill passed by the Nashville City Council:
"We are the friendliest city in America," said Mayor Bill Purcell, who's spending the last of eight years in office. "It is a part of who and what we are. We encourage people to come for the weekend, a week or the rest of their lives. And this law was directly contrary to that." . . .
Purcell is clear with his disdain that Hispanic immigration is the real catalyst [for the bill], mentioning Wal-Mart's recent decision to add Spanish signs to its stores. The school system recently launched a TV spot in Spanish that describes school programs and last year added a Hispanic family outreach coordinator.
"There have been laws like this attempted and passed in lots of different places, and none of them go to the issue that's bothering them," he said.
Purcell, a careful politician who's chosen to make this his first major veto, flips his business card onto his desk in exasperation. On the front his name and number are in English; on the back, in Japanese.
"My business card would have been illegal," he said. "Why is my card in English and Japanese? It's not because I speak Japanese. It's because we are the most successful recruiter of Japanese business and investment of any city off the West Coast of America. We greet Japanese visitors in Japanese at the airport. This law would have said that was illegal. And that's wrong in every way." [Source: Houston Chronicle]
Purcell is in China right now; presumably the Chinese business cards Purcell is passing out there would also be illegal in his hometown as well.
As we mentioned in another post, local and state legislators seem to have little clue how much these laws hinder economic development.
Posted by John at 9:51 AM | Comments (0) | TrackBackApril 15, 2007
Huge Headaches for Southeastern Economic Development Officials
Sometimes state and local officials do not understand how their actions are being watched internationally, and how those actions can affect a state's economic development efforts globally. Matt Kisber, Tennessee's Commissioner of Economic and Community Development, can offer just one particular example:
. . . Kisber recounted a visit to Ottawa, Canada, in November to meet with what he described as Canadians that were equivalent to U.S. State Department officials.
At the meeting, Kisber was "taken aback" because the "first thing" the officials said was "what do Tennesseans have against Canadians?"
According to Kisber, the Canadians referenced the now-notorious political advertisement, paid for by the Republican National Committee, that criticized Democratic U.S. Senate candidate Harold Ford Jr. through a number of different people, including a scantily clad blonde woman who said she had met "Harold at the Playboy party."
But what the Canadians were concerned about was another character in the commercial that specifically referenced Canada, suggesting that the country could "take care of North Korea" because "they’re not busy."
"They took that very personally," Kisber said. "And I spent the better part of half of my meeting convincing them of why we like Canada." [Source: Nashville CityPaper]
Kisber's comments were made in the context of a current effort in Tennessee to require that driver's license tests be given in English only. I don't know the genesis of this particular bill, but it's not a stretch to assume that it is, like many language and immigration-related bills in state houses around the country, aimed primarily at Spanish-speaking Hispanic immigrants.
Kisber's problem, as the state's chief global salesman, is that the Tennessee test is given not just in English and Spanish currently, but in Japanese and Korean. It's not an insignificant issue, as Tennessee is now home to over 150 different Japanese firms employing more than 40,000 Tennesseans and representing almost $10 billion of investment.
Further, Tennessee is trying to get Japan to relocate its New Orleans consulate to Nashville, and Kisber notes that the Japanese Consul General has expressed concerns about the English-only driver's license bill on "a number of occasions".
Foreign governments, as they offer counsel their home companies on expansion locations, assess the overall receptivity of a state or region to foreign investment generally. They understand that some language- and immigration-oriented laws being passed at the state and local level are explicitly aimed at Hispanics. Georgia's SB 529, passed in last year's legislative session, clearly and unabashedly targeted Georgia's Spanish-speaking immigrant population.
At the same time, these foreign governments and their home companies also know that such laws know no boundaries. They are enforced on all foreigners, sometimes capriciously and cruelly.
Just ask Cheryl Kuehn, a 23 year old Canadian, who was recently arrested near Brunswick, Georgia for speeding and running a stop sign. Upon determining that Ms. Kuehn was a Canadian, she was taken to a detention facility. According to this report, it took Glynn County officials eleven minutes to contact U.S. Immigration and Customs Enforcement and determine there was no reason to hold her, yet she was stripped, searched, fingerprinted, given a prison uniform, and held for 11 hours, thanks to the zealous efforts of Glynn County officials to enforce its own interpretation of S.B. 529:
Mrs. Kuehn's detention seems to be partially the result of confusion over a controversial new Georgia state immigration law.
The law, scheduled to come into effect July 1, was designed to prevent illegal immigrants from collecting social services, but also requires immigration checks for people charged with felonies or drunk driving.
Although Mrs. Kuehn was charged with neither, Sheriff Bennett said it is the Glynn County policy for every "foreign national" to undergo the immigration check, no matter how minor the offence.
"We will bring some of these immigrants in and they will post cash bonds and be released and then some time later find out they were wanted for felony charges or could be known criminals from their own country," said Sheriff Bennett, adding seven months ago the "strict" immigration law wouldn't have been in effect.
"I don't consider a Canadian to be an illegal immigrant, but according to this immigration policy, if they are a foreign national then they go through this process," he said. "We do not want to discriminate against anyone so we have to do everyone. It has to be systematic." [Source: Ottawa Citizen]
This impression of Georgia, splashed across newspapers and blogs not just in Canada but around the world thanks to the Internet, creates damage to the state's global reputation and its economic development efforts which are impossible to calculate, but real nonetheless. You can bet that our state officials, similar to Tennessee's Kisber, will be spending most of their upcoming meetings with Canadian officials talking not about the advantages of a Georgia location for Canadian companies, but trying to convince them that what happened to Ms. Kuehn was just an aberration caused by zealous locals.
That will take one heck of a sales job, particularly when state law is viewed by local officials as condoning such procedures and behavior.
Posted by John at 11:30 AM | Comments (0) | TrackBackApril 14, 2007
Major Chinese Trade Mission to Visit Atlanta
China is preparing a multi-billion-dollar buying mission to major American cities next month as part of a package of initiatives to reduce its swelling trade surplus and ease bilateral tensions with the US.
The initiatives, news of which has dribbled out in recent weeks, should be announced in detail before the second meeting of the strategic economic dialogue in Washington late next month.
Posted by John at 8:47 AM | Comments (0) | TrackBackMinisterial-level officials from both countries are involved in the top-level dialogue, led by Hank Paulson, US Treasury secretary, and vice-premier Wu Yi for the Chinese.
Although details have yet to be finalised, the buying mission is to be led by Ma Xiuhong, a vice-minister of commerce, and take in the cities of Atlanta, Chicago, San Francisco and Washington. Chinese businesses are expected to announce the purchase of $12bn in US agricultural and industrial goods as a result. . . .
April 11, 2007
Newcomers Drive Atlanta's Growth
One in six metro Atlanta residents didn't live in the region six years ago, and one out of those six didn't live in the United States six years earlier. [See this story.] Such a tremendous injection of new talent and ideas is extremely healthy for Atlanta's long-term growth prospects.
Posted by John at 6:49 AM | Comments (0) | TrackBackMarch 27, 2007
Globalization Employs Georgians
An updated Selig Center for Economic Growth study of the economic impact of Georgia’s ports has been released, and the significance of these facilities to the state’s economy continues to grow:
“The Economic Impact of Georgia's Deepwater Ports in Georgia's Economy in FY 2006” report shows Georgia's deepwater port activity directly and indirectly supported 286,476 jobs and was responsible for $55.8 billion in sales, $14.9 billion in income and $2.8 billion in state and local taxes in 2006. The report was presented to The Georgia Ports Authority at its monthly meeting this morning.
Taking into account an adjustment for inflation, the port's output impact is 44 percent higher, its gross state product is 32 percent higher and its labor income impact is 26 percent higher than a similar study that was conducted for fiscal 2003, according to Jeffrey M. Humphreys, the report's author and director of the Terry College's Selig Center for Economic Growth.
[Source: Atlanta Business Chronicle]
I wonder what the results would be without all those imports, particularly from China? How many jobs would be lost? How much would the state’s coffers suffer?
The mercantilists don’t like it, but it’s a fact: an increasing proportion of Georgia’s citizens have a stake in globalization and increased trade.
Posted by John at 9:48 AM | Comments (0) | TrackBackMarch 5, 2007
Southeastern States Cooperate to Compete Globally
We recently wrote on the massive $3 billion steel mill ThyssenKrupp has planned for either an Alabama or a Louisiana location, noting that the economic benefit of this by-product of a global economy would fall on a regional area, not just one state.
To that point, Gov. Haley Barbour of Mississippi and Florida Gov. Charlie Crist have joined with Gov. Bob Riley of Alabama to lobby ThyssenKrupp jointly on picking a northern Mobile County site. An estimated 30% of the jobs generated by this project would likely go to Mississippi or Florida residents, given the proximity of the site to both states:
. . . Although the alliance serves a self-interest for the states involved, some experts predict it is part of a gradual tilt toward broader economic regionalism, especially in the South. Such partnerships could relax states' competition for corporate business, increase cooperation, and ease what some critics see as a lack of confidence that causes Southern states to overcompensate to win industry favor.
[Southern states] "have built incentive packages out the wazoo ... but they're insufficient," says Pete Whalley, an economic development expert at the University Research Center in Jackson, Miss. "Market forces don't care about state lines, so we don't need to think about boundaries anymore."
Economic regionalism was first touted in 1988 by then-Arkansas Gov. Bill Clinton and the governors of Louisiana and Mississippi, who shook hands on a barge in the middle of the Mississippi River to start the Delta Regional Authority. This multistate approach has slowly been taking hold in other parts of Dixie. . . . [Source: Christian Science Monitor]
While the choice for ThyssenKrupp is down to two locations in the Southeast a couple of hundred miles from each other, in a global economy this region is increasingly competing against not just other regions of the U.S., but mega-regions around the world. Southeastern political and business leaders seem to uniformly understand the need to lay down arms and work together for the entire region’s benefit.
By the way, Bill Clinton was hardly the first Southeastern governor to tout economic regionalism in the Southeast. Georgia’s George Busbee was the key organizer—in 1975, before Bill Clinton was elected to anything—of the SEUS/Japan Association. This organization was created to promote business ties and friendly relations between its member states in the South and Japan. The seven member states are Alabama, Florida, Georgia, North Carolina, South Carolina, Tennessee and Virginia. Twenty-nine annual meetings have been held since the organization’s founding, and more than 1,000 Japanese firms have expanded into the Southeast over the past three decades.
Posted by John at 10:09 PM | Comments (0) | TrackBack