Florida Chamber Chief Economist Dr. Jerry Parrish Details The Coronavirus’ Threats on Florida’s Economy
“With companies cutting their GDP forecasts, 30-year mortgages at an eight-year low, and manufacturers idling their factories because of supply-chain issues, all of this is having an effect on Florida’s economy.”
– Dr. Jerry Parrish
TALLAHASSEE, Fla (February 25, 2020) – Florida Chamber Foundation Chief Economist Dr. Jerry Parrish says Florida should be “concerned, but not panicked” about the coronavirus’s threats on Florida’s economy.
“Yesterday the Dow dropped by more than 1,000 points, companies are cutting their GDP forecasts, 30-year mortgages are at an eight-year low, manufacturers are idling their factories because of supply chain issues. All of this is having an effect on Florida’s economy, and it could continue. This is certainly a concern, but it’s not anything to panic about,” Dr. Parrish explained in his latest Florida By The Numbers report.
According to Dr. Parrish, Florida’s most vulnerable industries include:
• International Visitors
• Cruise Passengers
• Manufacturing Jobs
The 10-year government bond, and the three-month T-bill are now showing an inversion.
“An inversion of the yield curve has been a reliable, but not perfect signal, of a future recession. This is one of the metrics that goes into the calculation of the probability of a Florida recession which is on TheFloridaScorecard.org,” Dr. Parrish explained. “The probability of Florida being in a recession over the next nine months has now increased to 24.1 percent.”
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Target List of U.S. Proposed Exports to China for Increased Tariffs
Please note that as of publication of this notice, the tariffs on these products had not gone into effect. (As of April 4, 2018)
- Yellow soybean
- Black soybean
- Corn flour
- Uncombed cotton
- Cotton linters
- Brewing or distilling dregs and waste
- Other durum wheat
- Other wheat and mixed wheat
- Whole and half head fresh and cold beef
- Fresh and cold beef with bones
- Fresh and cold boneless beef
- Frozen beef with bones
- Frozen boneless beef
- Frozen boneless meat
- Other frozen beef chops
- Dried cranberries
- Frozen orange juice
- Non-frozen orange juice
- Unstemmed flue-cured tobacco
- Other unstemmed tobacco
- Flue-cured tobacco partially or totally removed
- Partially or totally deterred tobacco stems
- Tobacco waste
- Tobacco cigars
- Tobacco cigarettes
- Cigars and cigarettes, tobacco substitutes
- Hookah tobacco
- Other tobacco for smoking
- Reconstituted tobacco
- Other tobacco and tobacco substitute products
- SUVs with discharge capacity of 2.5L to 3L
- Other vehicles equipped with an ignited reciprocating piston internal combustion engine and a drive motor that can be charged by plugging in an external power source. Cylinder capacity displacement exceeding 2500ml, but not exceeding 3000ml for SUVs (4 wheel drive)
- Vehicles with discharge capacity of 1.5L to 2L
- Other vehicles equipped with an ignited reciprocating piston internal combustion engine and a drive motor that can be charged by plugging in an external power source. Cylinder capacity displacement exceeding 1000ml, but not exceeding 1500ml for SUVs (4 wheel drive)
- Passenger cars with discharge capacity 1.5L to 2L, 9 seats or less
- Other vehicles equipped with an ignited reciprocating piston internal combustion engine and a drive motor that can be charged by plugging in an external power source. Cylinder capacity displacement exceeding 1000ml, but not exceeding 1500ml for 9 passenger cars and below
- Passenger cars with discharge capacity of 3L to 4L, 9 seats or less
- Other vehicles equipped with an ignited reciprocating piston internal combustion engine and a drive motor that can be charged by plugging in an external power source. Cylinder capacity displacement exceeding 3000ml, but not exceeding 4000ml for 9 passenger cars and below
- Off-road vehicles with discharge capacity of 2L to 2.5L
- Other vehicles equipped with an ignited reciprocating piston internal combustion engine and a drive motor that can be charged by plugging in an external power source. Cylinder capacity displacement exceeding 2000ml, but not exceeding 2500ml for off-road vehicles
- Passenger cars with discharge capacity of 2L to 2.5L, 9 seats or less
- Other vehicles equipped with an ignited reciprocating piston internal combustion engine and a drive motor that can be charged by plugging in an external power source. Cylinder capacity displacement exceeding 2000ml, but not exceeding 2500ml for 9 passenger cars and below
- Off-road vehicles with discharge capacity of 3L to 4L
- Other vehicles equipped with an ignited reciprocating piston internal combustion engine and a drive motor that can be charged by plugging in an external power source. Cylinder capacity displacement exceeding 3000ml, but not exceeding 4000ml for off-road vehicles
- Diesel-powered off-road vehicles with discharge capacity of 2.5L to 3L
- Other vehicles equipped with an ignited reciprocating piston internal combustion engine and a drive motor that can be charged by plugging in an external power source. Cylinder capacity displacement exceeding 2500ml, but not exceeding 3000ml for diesel-powered off-road vehicles
- Passenger cars with discharge capacity of 2.5L to 3L, 9 seats or less
- Other vehicles equipped with an ignited reciprocating piston internal combustion engine and a drive motor that can be charged by plugging in an external power source. Cylinder capacity displacement exceeding 2500ml, but not exceeding 3000ml for 9 passenger cars and below
- Off-road vehicles with discharge capacity of less than 4L
- Other vehicles equipped with an ignited reciprocating piston internal combustion engine and a drive motor that can be charged by plugging in an external power source. Cylinder capacity displacement not exceeding 4000ml for off-road vehicles
- Other vehicles which are equipped with an ignited reciprocating piston internal combustion engine and a drive motor and can be charged by plugging in an external power source
- Other vehicles that are equipped with a compression ignition type internal combustion engine (diesel or semi-diesel) and a drive motor, other than vehicles that can be charged by plugging in an external power source
- Other vehicles which are equipped with an ignition reciprocating piston internal combustion engine and a drive motor and can be charged by plugging in an external power source
- Other vehicles that are equipped with a compression-ignition reciprocating piston internal combustion engine and a drive motor that can be charged by plugging in an external power source
- Other vehicles that only drive the motor
- Other vehicles
- Other gasoline trucks of less than 5 tons
- Transmissions and parts for motor vehicles not classified
- Liquefied Propane
- Primary Shaped Polycarbonate
- Supported catalysts with noble metals and their compounds as actives
- Diagnostic or experimental reagents attached to backings, except for goods of tariff lines 32.02, 32.06
- Chemical products and preparations for the chemical industry and related industries, not elsewhere specified
- Products containing PFOS and its salts, perfluorooctanyl sulfonamide or perfluorooctane sulfonyl chloride in note 3 of this chapter
- Items listed in note 3 of this chapter containing four, five, six, seven or octabromodiphenyl ethers
- Contains 1,2,3,4,5,6-HCH (6,6,6) (ISO), including lindane (ISO, INN)
- Primarily made of dimethyl (5-ethyl-2-methyl-2oxo-1,3,2-dioxaphosphorin-5-yl)methylphosphonate and double [(5-b Mixtures and products of 2-methyl-2-oxo-1,3,2-dioxaphosphorin-5-yl)methyl] methylphosphonate (FRC-1)
- 38248600a articles listed in note 3 to this chapter containing PeCB (ISO) or Hexachlorobenzene (ISO)
- Containing aldrin (ISO), toxaphene (ISO), chlordane (ISO), chlordecone (ISO), DDT (ISO) [Diptrix (INN), 1,1,1-trichloro-2 ,2-Bis(4-chlorophenyl)ethane], Dieldrin (ISO, INN), Endosulfan (ISO), Endrin (ISO), Heptachlor (ISO) or Mirex (ISO). The goods listed in note 3 of this chapter
- Other carrier catalysts
- Other polyesters
- Reaction initiators, accelerators not elsewhere specified
- Polyethylene with a primary shape specific gravity of less than 0.94
- Lubricants (without petroleum or oil extracted from bituminous minerals)
- Diagnostic or experimental formulation reagents, whether or not attached to backings, other than those of heading 32.02, 32.06
- Lubricant additives for oils not containing petroleum or extracted from bituminous minerals
- Primary Shaped Epoxy Resin
- Polyethylene Terephthalate Plate Film Foil Strips
- Other self-adhesive plastic plates, sheets, films and other materials
- Other plastic non-foam plastic sheets
- Other plastic products
- Other primary vinyl polymers
- Other ethylene-α-olefin copolymers, specific gravity less than 0.94
- Other primary shapes of acrylic polymers
- Other primary shapes of pure polyvinyl chloride
- Polysiloxane in primary shape
- Other primary polysulphides, polysulfones and other tariff numbers as set forth in note 3 to chapter 39 are not listed.
- Plastic plates, sheets, films, foils and strips, not elsewhere specified
- 1,2-Dichloroethane (ISO)
- Halogenated butyl rubber sheets, strips
- Other heterocyclic compounds
- Adhesives based on other rubber or plastics
- Polyamide-6,6 slices
- Other primary-shaped polyethers
- Primary Shaped, Unplasticized Cellulose Acetate
- Aromatic polyamides and their copolymers
- Semi-aromatic polyamides and their copolymers
- Other polyamides of primary shape
- Other vinyl polymer plates, sheets, strips
- Non-ionic organic surfactants
- Lubricants (containing oil or oil extracted from bituminous minerals and less than 70% by weight)
- Aircraft and other aircraft with an empty weight of more than 15,000kg but not exceeding 45,000kg
Florida Chamber Supports Trans-Pacific Partnership American Trade Policy
Florida’s current business agenda puts jobs, growth and economic opportunity in the driver’s seat. Florida has been able to grow our economy exponentially due to a smart and business-friendly environment. The Florida Chamber of Commerce supports the Trans-Pacific Partnership (TPP) American trade policy as it will have a significant impact on the strength of our economy and the lives of Floridians.
The TPP agreement will provide Florida with the opportunity to increase goods and services trade with emerging markets across the globe. It will accomplish this by removing several challenges that our businesses face when they attempt to bring their goods to international markets. This monumental trade deal will create a level playing field between U.S. companies of all sizes with some of our strongest trading partners.
Florida already has good trade ties with several of the TPP countries. Florida exported $1.6 billion in goods and $3.3 billion in services in 2014 to these countries. The TPP will remove nearly 18,000 tariffs American businesses face, which will undoubtedly increase exports tot he TPP partner countries.
The U.S. Department of Commerce Bureau of Economic Analysis shows that Canadian and Japanese companies alone employed approximately 57,200 employees in Florida in 2013. More than 1,300 Florida businesses are subsidiaries of companies based in TPP countries, serving as an important source of business investment and job creation in the state. Statewide there are nearly 942,000 jobs supported by the TPP trade in Florida.
Florida will benefit from the opportunities created by the TPP and we encourage Congress and the President to enact legislation that will implement it.
Solidifying Florida’s Role in Trade and Logistics
As Florida becomes the third most populous state in the nation and with an estimated six million new residents settling in our state by 2030, our state has to find new solutions that help, not only the way we view resources, but the way we run international business.
The global economy is expected to double in size throughout the next 20 years. One billion new consumers will enter the middle class by 2020, with two thirds living in emerging markets. By 2030, the world’s population will increase to 8.4 billion, 80 percent of the world’s purchasing power, 90 percent of economic growth, and 95 percent of consumers will live outside of U.S. borders.
Continuing to focus on diversifying our economy and markets of opportunity is an important strategy for success and continued growth. Free trade agreements adopted and under consideration create new business opportunities and have opened Florida to new markets. Florida is well positioned to not only benefit from international trade but play a pivotal role in new and emerging trade lanes.
Economic development in areas such as international trade, sea port, manufacturing, aerospace, aviation and other targeted clusters is tied directly to innovation, diversification and how well Florida can adapt to growing and changing trends.
According to the Florida Chamber Foundation’s Trade and Logistics 2.0 Report, Florida can create more than 150,000 high-wage jobs by growing manufacturing, exports and trade and logistics. In order to take advantage of changing trade routes, a historic expansion of the Panama Canal, and targeted infrastructure investments, we must continue to leverage and grow opportunities.
Strengthening Florida’s rapidly growing manufacturing industry will be the key to ensuring a robust global future. The Florida Chamber will support increasing Enterprise Florida’s budget for international trade and marketing activities and will continue to support initiatives that encourage growth in the manufacturing, trade and logistics industries.
The Florida Chamber will also continue to support strategic investments in our trade infrastructure, work to build a “talent supply chain” for trade, logistics and manufacturing workers and ensure an ongoing strategic presence in Washington, D.C. – advocating and positioning Florida for a leadership role at the federal level.
In order to become the number one state in the nation for innovation and economic development, we must continue to attract and retain high-skilled talent, target growing industries and continue to work toward the recommendations set forth in the Florida Chamber Foundation’s Trade and Logistics 2.0 report.
Florida is the 3rd Largest Exporter of High-Tech Goods in the U.S.
When people think of Florida-based exports, they tend to think of agricultural products like fruits, sugar, vegetables and other commodities. However, 92 percent of Florida-origin exports are manufactured goods, which create high-skill, high-paying jobs for Floridians and contribute $53.8 billion to Florida’s economy. High-tech products, in particular, accounted for nearly 1 in 4 of Florida’s exports in 2014 and contributed $13.9 billion a year to Florida’s export market, making Florida the 3rd largest exporter of high-tech goods in the nation.
With research from the Florida Chamber Foundation’s Trade & Logistics Study 2.0 showing that 95 percent of the world’s consumers live outside the U.S., what is your business doing to diversify into new markets and become globally competitive?
A Simple Guide to China’s Devaluation of the Yuan
China devalued the Yuan against the U.S. dollar
Why did this happen?
China devalued its currency against the U.S. dollar to make Chinese goods cheaper and boost exports after Chinese exports declined 8.3 percent in July.
What does this mean?
The Yuan is loosely tied to the U.S. dollar and has been strengthening as the U.S. economy picks up. The U.S. Fed is considering a rate hike in the near future as the U.S. economy continues to move ahead, thus further strengthening the dollar. As China is an export-oriented economy, this potential increase would put greater pressure on declining exports.
What are the impacts to the U.S.?
A cheaper Yuan will mean a decrease in U.S. exports as Chinese products will be less expensive. As other nations consider the impact of the Chinese devaluation to their exports, they too may devalue their currencies to remain competitive with the Chinese goods further putting pressure on US exports.
What are the Impacts to other parts of the world?
The Chinese currency implications go beyond the devaluation as it’s a symptom of its overall economic health as the Chinese growth engine continues to slow down. This will have far reaching implications for emerging markets that export heavily to China, particularly commodity exporters heavily dependent on China like Brazil, Russia, South Africa, Indonesia, and Malaysia. A weaker yuan is also a concern for developing nations that compete with China in exporting similar goods and services to similar destinations. Taiwan and South Korea face some of the greatest risks, but Thailand and the Philippines may also be affected and even Mexico may feel the impact of cheaper Chinese goods.
All this comes at a time when emerging markets are facing other factors and issues are affecting their growth. While larger economies are able to sustain and mitigate the Yuan depreciation, China is still the world’s second largest economy, and emerging markets which heavily depend on China are important to the overall global economy. Their health will have an impact on global markets.
What does this mean for Florida?
The Chinese currency depreciation will have an impact on Florida exports, which compete with China. Florida will need to remain vigilant to the currencies of Florida’s trading partners such as Taiwan and Korea, who are strongly tied to Chinese trade. As their currencies may weaken as well, adding to the fallout of the Chinese devaluation. The Florida Chamber’s International Program will keep you up to date as this issue unfolds.
NEED MORE INFO?
For more information on how this affects Florida’s future, please contact the Florida Chamber’s Chief Economist Dr. Jerry Parrish at firstname.lastname@example.org.
MERCOSUR, a trading bloc made up of South American countries, was created in 1991 to promote free trade and the fluid movement of goods.
MERCOSUR bloc met in July at their 48th summit where Bolivia was officially incorporated as its sixth permanent member. More newsworthy, particularly in light of the bloc’s troubled economic performance, there was some progress towards advancing on long-stalled trade initiatives, specifically an agreement with the EU. These initiatives appear to show promise are in part due to mounting pressure from Brazil to gain greater market access.
Trade among member countries continues to decline with a 20.3 percent drop in the first quarter of 2015 compared to the same period last year. Last year, intra-bloc trade declined 13.1 percent. All of the Mercosur member countries were hit with a decline in exports to other member states according to a report recently released by the Argentine Chamber of Commerce (CAC). The report highlighted the following:
- Venezuela with a 46.3 percent decline
- Uruguay with a 32.6 percent decline
- Argentina with 24.9 percent decline
- Brazil with 13.7 percent decline
- Paraguay with a 12.5 percent decline
Intra-regional trade has not been the only problem as the overall export sector has taken a hit due to commodity prices and economic instability as well as uncertainty facing its largest member nations.
Obstacles still remain such as Mercosur’s Resolution 32/2000, which requires consensus from all members in trade issues, including bilateral agreements. Resolution 32/2000 has been called a source of gridlock by Forbes because of the requirement of consensus from all members on all trade issues. Overcoming a culture of protectionism will also be a challenge as this has led to a countless regulations which will be difficult to reverse and will likely makes any short term gains improbable.
What does this mean for Florida? A decline in MERCOSUR bloc economies has had an impact on Florida’s overall trade numbers. Brazil, Florida’s most important trading partner, saw a decline of 11.3 percent, significantly affecting Florida exports in several sectors. Argentina and Venezuela are also important Florida export destinations and their instability and uncertainty have also had repercussions.
But bright spots remain in Latin America. Peru, an important member of the Pacific Alliance, is growing and is well positioned for additional growth. While the Pacific Alliance bloc is not as large – economically speaking – as MERCOSUR, its benefits from strong policies that favor increased market access and openness which will certainly generate new opportunities for Florida exporters.
Learn what your business needs to know in order to successfully trade with the world’s growing economies by becoming a part of the Florida Chamber’s Global Florida program. Contact Alice Ancona today for more information.
A Focus on Brazil and Mexico
For the fifth time this year, economists have reduced their economic forecasts for Brazil for this year and next year. Economists also increased their estimate for the 2015 inflation rate to 8.97 percent from 8.79 percent, according to a weekly central-bank survey.
The government of Brazil announced at the end of June the launching of its National Export Plan (PNE) to increase exports as a means of helping prop up its weakened economy. The plan will focus on five areas: access to markets, commercial marketing, ease of trade, export financing guarantees and the improvement of the fiscal system related to foreign trade.
Brazil’s president recently outlined a $65 billion infrastructure plan to sell to the private sector new concessions to build and operate nearly 7,000km (4,350 miles) of roads, as well as four large airports and a number of ports and railways.
Under the package, Brazil will offer concessions worth about R$66bn for roads to connect soybean growers of the interior to ports, R$86bn for railways, R$37bn for ports and nearly R$9bn for airports, including for the cities of Salvador, Florianópolis, Fortaleza and Porto Alegre.
President Rousseff stated that her administration will directly engage in activities that will expand and diversity market access for Brazilian products and will be making more official trips abroad to support the plan.
Mexico’s Global Economic Activity Index rose 2.4 percent in April compared to April 2014, an increase fueled by growth in the agricultural sector.
The Mexican government will hold its first of several petroleum auctions this week. This will effectively end the monopoly of state-owned Petroleos Mexicanos (PEMEX) which began in 1938 when the country’s oil fields were nationalized.
The auction will cover 14 shallow-water blocks in the southeastern Gulf of Mexico. Seven groups and 17 companies — including two of the world’s largest, Exxon Mobil Corp. and Chevron Corp. — have prequalified to bid. Mexico will auction onshore fields later this year, followed by auctions of deep-water and shale fields.
Mexico is expanding beyond the low-wage, low-value manufacturer that it was when NAFTA was first implemented over 20 years ago. With an increasingly skilled Mexican workforce and a growing middle class, foreign direct investment into high-value manufacturing facilities has been increasing with more in the works.
This is a near-shoring trend that was recently fueled by the west coast port congestion which triggered many to review their supply chains and look for alternatives that would provide them with more consistent and reliable production centers. Mexico has multiple routes of entry in the US and offers reduction in cost of transportation and improved speed to market.
Mexico is also the second-largest source of high-value, high-tech products such as cell phones, gaming consoles and computers, after China.
The Mexican government is moving to enhance its competitive position by investing heavily in road, rail and aviation infrastructure improvements and by streamlining its customs procedures.
- The U.S. Department of Transportation recently began permitting Mexican motor carriers to apply to conduct long-haul, cross-border trucking services. Under this program, Mexican trucks must be inspected and are required to meet the same safety requirements as U.S. trucks.
- Mexico is continuing to work with Canada and the U.S. to improve customs harmonization and signed on to the Wassenauer Agreement on export controls last year which, along with implementing an export control system along with its single platform on imports they now have greater trade compliance
- Cargo security is improving and IP protection is as strong as or stronger than in many other countries around the world.
Opportunities for Florida Firms:
Over the next four years, the Government of Mexico plans to invest more than $600 billion to modernize its energy, transport, telecommunications, and water and environment sectors. In order to support the country’s ambitious reform efforts and position U.S. firms for success implementing critical infrastructure projects, USTDA developed the Mexico Infrastructure Project Resource Guide to provide U.S. industry with details on Mexico’s infrastructure sectors and specific infrastructure development plans through 2018. The resource guide includes over 25 project profiles, complete with real-time market intelligence, detailed project plans, contact details for key decision makers, procurement timelines, and planned financing mechanisms.
Project profiles in the guide are separated by sector, and include energy, transport, telecommunications, and water and environment. The full guide can be viewed and downloaded on USTDA’s website.
Latin American Outlooks and What They Mean for the U.S. and Florida
The region’s economy is projected to grow only 0.1 percent this year according to economist projections. The combined forces of worsening terms of trade, a stronger dollar, a slower Chinese economy as well as economic crises in Argentina, Brazil and Venezuela are all hampering growth.
What do these changes mean for the U.S. and Florida?
- Reduced Exports:
Weaker demand and a stronger dollar impacting Latin American markets may result in reduced U.S. and Florida exports.
- Decreased Tourism:
Stalling economies have caused tourism and business travel to the U.S. to take a hit. Florida’s tourism industry, a crucial part of the state’s economy, may suffer.
However, there are several positive opportunities for both the U.S. and Florida within several nations:
Chile’s industrial sector remains stable for the remainder of the year. While copper demand has taken a hit, renewable energy and construction sectors are likely to be the two major growth sectors in 2015. A stable political environment, rising domestic demand for energy, and a significant pipeline of infrastructure projects are expected to drive growth in the short run.
Colombia’s industrial sector remains stable and diversified. Continued domestic demand from an increasing middle-class population and steady investment are expected to create GDP growth for the rest of the year. Reduced oil prices will have a minimal impact on growth.
Mexico seems to be a bright spot for the Americas. A steady improvement of the U.S. economy and a depreciated PESO is expected to increase Mexican exports as well as foreign investment inflows in 2015. Reformed laws which have opened up its energy sector are also expected to attract significant investment.
Even more opportunities arise from the area as a whole. Latin America, with a population of approximately 600 million people, is home to nearly 15,000 “ultra high net worth” individuals, or people with fortunes of at least $30 million, according to the luxury industry consultancy Wealth-X.
The number rose 5 percent last year, while the number of billionaires in Latin America rose to 151, a 38 percent increase resulting in the fastest growth rate for billionaires of any region on earth.
The region’s largest economies, Mexico and Brazil, remain the largest generators of growth and wealth. Mexico is the world’s second-largest market for private jets, behind the US, with Brazil poised to surpass it within the next decade, according to a recent market study by the Brazilian jetmaker Embraer. According to the market research firm Euromonitor, the Latin American luxury market will total $26.5 billion in 2019, up 88.8 percent from 2014 boasting the strongest growth in the world.
European Nations Lead Investments in Florida’s Global Economy
FOR IMMEDIATE RELEASE
CONTACT: Edie Ousley, 850-521-1231 or 850-251-6261
Companies from Europe Account for 67% of all Florida
Foreign Employment and 17% of Florida Origin Exports
TALLAHASSEE, FL. (May 27, 2015) – European countries are the leaders among foreign investors, with majority foreign-owned companies from Europe accounting for 67 percent of all Foreign Direct Investment (FDI) employment in Florida, the Florida Chamber of Commerce announced today.
“Florida’s leading European investors include the UK, Germany, France, Switzerland and the Netherlands. Europe presents unique strategic, trade and export opportunities for Florida,” said Alice Ancona, Director of Global Outreach for the Florida Chamber of Commerce. “Currently, 17 percent of all Florida origin exports go to Europe, a market of over 500 million consumers. The U.S. and Europe represent half of the world’s economic production. Opening markets and creating jobs for Florida families are why trade is important to Florida.”
Florida visitors from Europe also help strengthen Florida’s economy and create jobs. In fact, every 85 visitors that come to Florida help create one new Florida job. Out of the top international countries for visitation to Florida, the UK ranked third, behind Canada and Brazil, with 1.6 million visitors in 2014.
The impact of international trade to Florida’s economy cannot be denied.
- International business and foreign direct investment accounts for approximately 17 percent of Florida’s economic activity, and
- Directly supports more than 1 million Florida jobs.
- Florida is the seventh largest exporter of state-origin products with Florida-origin exports totaling more than $58.6 billion and exports from Florida supporting 275,221 U.S. jobs in 2013.
But Florida’s business leaders know that Florida must continue to work hard to remain the leader in international initiatives.
“Florida has come a long way in building international economic development efforts, but our work is far from over,” said Doug Davidson, Market Executive of Global Commercial Banking at Bank of America Merrill Lynch. “At Bank of America, we support the Florida Chamber Foundation’s research in trade and logistics because we know that Florida’s future lies in being globally competitive.”
The Florida Chamber’s Global Florida Program’s mission is to educate and promote business opportunities, collaborate and advance policy initiatives in each of the four major geographic regions: Americas, Asia Pacific, Europe and Middle East/Africa. Agriculture Commissioner Adam Putnam recently sponsored the Florida World Trade Month resolution, which was signed by Governor Scott, Attorney General Pam Bondi and CFO Jeff Atwater.
The Florida Chamber of Commerce is the voice of business and the state’s largest federation of employers, chambers of commerce and associations, aggressively representing small and large businesses from every industry and every region. The Florida Chamber works within all branches of government to affect those changes set forth in the annual Florida Business Agenda, and which are seen as critical to secure Florida’s future. The Florida Chamber works closely with its Political Operations and the Florida Chamber Foundation. Visit www.FloridaChamber.com for more information.
Florida Chamber Series on Free Enterprise: Bob Grammig on Florida’s Global Economy
Florida is a global economy. In fact, if Florida was a country, it would be the 19th largest economy in the world. According to research from the Florida Chamber Foundation’s Trade and Logistics Study 2.0, the global economy is expected to double in size over the next 20 years, with more than one billion new consumers by 2020.
For Florida to move in the right direction, we need to focus on the Florida Chamber Foundation’s initiatives to MOVE, MAKE and MULTIPLY.
“We need to emphasize (on) moving more trade through our seaports and air gateways,” said Bob Grammig, Partner at Holland & Knight. “We need to have an emphasis on moving more imports directly into Florida and better balancing the inbound and outbound trade flows. Second thing we need to do is make, grow and refine more products for exports from Florida by expanding exports of Florida-originated manufactured goods, agricultural products and other natural resources. And the third thing we need to do is to multiply the impacts of global trade in Florida by providing value added services to trading businesses and our trading partners around the world, by expanding our role as the global hub for visitors, investment and talent.”
Building a global economy means opportunities for Florida’s small businesses as well. In fact, 95 percent of our state’s 60,000 exporters are small-to-medium-sized businesses that produce two-thirds of Florida’s total export value.
“One of the top things we can do is to continue to identify and elimate legislative and regulatory impediments to international business,” said Grammig. “Big businesses can, in many cases, take care of themselves on this. But for smaller businesses, it’s very helpful to have an organization like the Florida Chamber to help drive necessary changes. The other thing… we want to do is continue to support the Governor’s strategic emphasis on trade and logistics -expansion of our seaports, improvements of our airports- which will facilitate smaller exporters to have access to those international markets. And the last thing is generally, to provide continuing support through trade missions and export promotion activities to various trade partners around the world.”
Economic trade missions like the upcoming one to Peru, hosted by Enterprise Florida, and events like the upcoming International Days will benefit businesses of all sizes.
“Business leaders will hear some top international trade experts and thought leaders when they are there. many people in our state underestimate the scope of our international business,” said Grammig. “There’s more than $60 billion in exports that we do. Small businesses I think will find especially usual to learn about the programs that the Florida Chamber as well as the state federal government have to assist their international efforts.”
Manufacturing Creates Jobs in Florida
For every 10 jobs created in Florida’s export-oriented manufacturing, 12 more jobs are created in transportation, warehousing and retail? With an additional eight jobs created in business services, there are a total number of 30 jobs supported by Florida export manufacturing. In fact, manufacturing has the highest jobs “multiplier” of any sector because it leads to the creation of more indirect and induced jobs in other sectors in the economy.
Simply put, expanding manufacturing in Florida diversifies the economy and provides high-wage jobs. In 2013, the Florida Legislature passed a three-year exemption from sales and use taxes on industrial machinery and equipment used in manufacturing in Florida. This exemption is expected to increase capital investment in Florida by manufacturers, improve productivity, and help Florida’s manufacturers compete better in world markets.
Florida needs manufacturing. Consider the facts:
- Florida is the 12th-highest state in number of people employed in manufacturing.
- Florida has 330,544 manufacturing employees, with an average annual wage of more than $54,000.
- Floridians receive $17.9 billion in manufacturing wages in Florida.
- There are 19,206 manufacturers in Florida – an increase of 696 over the last year.
- Manufactured Goods Exports in 2013 equal $56.4 billion.
- Manufacturing’s Share of Florida’s Exports in 2013 was 93.3 percent.
Besides diversifying the economy, manufacturing firms perform around 70 percent of U.S. Industry Research and Development, even though manufacturing accounts for only about 11 percent of the U.S. economy.
“The impact Florida’s manufacturing industry has on our state’s small businesses is undeniable,” said Michael Myhre, Network State Director for Florida’s Small Business Development Center (SBDC) Network. “Manufacturing helps diversify Florida’s economy and helps create high-wage jobs for Floridians. When Florida remains competitive, small businesses succeed.”
Beginning today, the Manufacturers Association of Florida is hosting their annual Manufacturing Days event in Tallahassee this week. Manufacturing Days will feature speakers on topics important to manufacturers including water policy, the sales tax exemption for manufacturing machinery and equipment, tax issues, and the Florida Chamber’s Legislative Priorities.
Share Your Manufacturing Story:
Is your community diversifying its economy by adding manufacturing companies and manufacturing jobs? How are your local and regional educational institutions helping prepare your workforce for the manufacturing jobs of the future? Tell us by contacting us at email@example.com.
About the Florida Scorecard Did You Know:
The Florida Scorecard, located at www.TheFloridaScorecard.com, presents metrics across Florida’s economy. Each month, the Florida Chamber Foundation produces a Scorecard Stat that takes an in-depth look at one aspect of Florida’s economy. If you would like additional information on the Weekly Scorecard Stat or on the Florida Scorecard, please contact Dr. Jerry Parrish with the Florida Chamber Foundation at 850.521.1283 or firstname.lastname@example.org. You can also follow the Florida Chamber Foundation on Twitter at @FLChamberFDN.
US and Africa Aim to Boost Trade
By WILLIAM MAUDLIN and DREW HINSHAW
U.S. and African leaders meeting in Washington on Monday kicked off a campaign to renew a program that gives exemptions on U.S. tariffs and quotas in an effort to boost trade and stimulate the economies of sub-Saharan African countries.
Leaders in the U.S. and Africa are looking to spur economic ties at a time when trade between the two is sinking and China’s hunger for commodities is boosting Beijing’s influence on the continent.
U.S. Secretary of State John Kerry, center, discusses the African Growth and Opportunity Act on Monday during the U.S.-Africa Summit at the World Bank in Washington. AFP/Getty Images
American officials and lawmakers say extending the 14-year-old African Growth and Opportunity Act, or Agoa, is crucial to preserving trade ties with fast-growing African countries, especially when U.S. trade negotiations at the World Trade Organization and with other major economies have stalled.
China passed the U.S. in imports in 2012 and imported $88 billion from sub-Saharan Africa in 2013, according to the International Monetary Fund. Partly because of increased oil production at home, U.S. imports from the region plunged to $34.5 billion last year, from a peak of $78.2 billion in 2008, with exports showing some gains in recent years.
Agoa is part of a strategy to increase economic ties with a growing Africa—including in trade and power generation—as China strengthens ties on the continent and the European Union negotiates free-trade agreements there. The goal, U.S. officials say, is to replace foreign aid with trade.
Building economic ties could also help contain conflicts that have convulsed Africa, said Erastus Mwencha, deputy chairman of the 54-nation African Union.
But critics point out that the bulk of African trade is oil shipments from West Africa, and U.S. agricultural and textile interests have opposed efforts to expand the list of products eligible for tariff and quota breaks.
President Barack Obama’s trade policy has faced delays and dogged opposition in Congress, and a similar preferential tariffs program for the developing world was allowed to expire last year.
Florida Manufacturing Export Numbers Consistent With Boosting Efforts
Jensen Werley, Reporter- Jacksonville Business Journal
A report released by e-forecasting.com shows that exports of manufactured goods contributed significantly to the state’s international trade, according to sister paper the Orlando Business Journal.
Lake Ray, president of the First Coast Manufacturing Association, said he isn’t surprised.
“We’ve been wanting to double number of exports out of state, particularly out of the manufacturing sector,” Ray told the Jacksonville Business Journal.
Exports of manufactured goods have accounted for 76 percent of all state exports in May, which is the most recent data released. Exports from state manufacturers increased by 16.8 percent from the previous month.
Ray said that this could be because of efforts made at the state level, such as freight mobility plans, improvements to ports and a sales tax initiative to give exemption on manufacturing equipment, which took effect in April.
“We’re doing things to encourage and increase the things we’re making, and the number of things we’re exporting,” he said.
Florida Exports Up 10.4% in May
Cindy Barth, Editor-Orlando Business Journal
The latest international trade numbers show that $5.22 billion worth of goods left Florida for international markets in May, an increase of 10.4 percent from April, according to Durham, N.H.-based e-forecasting.com.
The May data is the most recent available.
Exports of manufactured goods contributed significantly to the state’s international trade, accounting for 76 percent of all state exports in May. Exports from state manufacturers increased in May by 16.8 percent from the previous month to $3.95 billion.
However, exports of non-manufactured goods went down 5.8 percent in May to $1.26.9 billion. This group of foreign sales consists of agricultural goods, mining products and re-exports — foreign goods that entered the state as imports and are exported in substantially the same condition.
Florida ranked 42nd among the 50 states during the first five months of this year. Compared to the same period in 2013, foreign sales from Florida’s companies, seasonally adjusted, decreased by an annual rate of 7.4 percent.