International business - AZ Business Magazine April 2008

International Business Opportunities Increase In Arizona

Arizona leaders are pushing the state’s businesses to the international forefront

When principals from United Kingdom-based txtNation, a technology solutions provider, wanted to spread their global wings they turned to Arizona to set up a U.S. location. Similarly, when the German firm Ubidyne, a wireless technology developer, was looking to establish its first U.S. global footprint, it zeroed in on Scottsdale and SkySong, the Arizona State University Scottsdale Innovation Center, to make an imprint. Ditto for Sebit, a Turkish e-learning company. Somehow, the Grand Canyon State is on the international radar these days.

Obviously, Arizona’s expansive blue skies and mountain vistas are appealing to these international companies. But the strategy behind such international business in Arizona hasn’t occurred by accident — it has been clearly mapped out by statewide economic development officials keen on building Arizona’s economy far beyond tourism, real estate and retirement mainstays.

Today, Arizona is playing on the global business stage and it is not a bit part. In 2007, according to the U.S. Department of Commerce, Arizona exported $19.18 billion worth of goods to a collection of countries around the globe — up from $18.28 billion in 2006.

The bulk of Arizona’s exports came from the Valley. According to 2006 figures from the U.S. Census Bureau, the metro Phoenix area logged almost $11 billion in exports, placing it in the top 20 metro areas nationwide. Tucson exported more than $3.2 billion worth of goods in 2006.

Based on the 2006 figures, Arizona’s increase in exports outpaced that of Texas and California. In addition, Arizona’s per capita exports in 2006 were at $2,966, besting Utah, New Mexico and Colorado.

Along with increasing exports, economic leaders’ are also working to bring more international businesses and foreign direct investment to the state.

“We strive to put Arizona on the international map,” says Barry Broome, president and CEO of the Greater Phoenix Economic Council and one of a handful of statewide economic experts pushing for Arizona’s global business success, in large part with his role in an economic statewide partnership called the Arizona Global Network (AGN). “Arizona is emerging as an incubator for international firms expanding in the U.S.”

The AGN includes economic brainpower from Flagstaff to Tucson to Yuma and everywhere in between. All have partnered with the goal to put Arizona’s business on the international scene. This stepped-up spotlight can be attributed to a number of factors. But for txtNation Director Michael Whelan, the decision for his firm came down to the fact that Arizona is a state on the ascension in the international business community.

“TxtNation chose Greater Phoenix due to its location, being a West Coast city on the rise,” he says, adding there is a global sense that Arizona is becoming an international “entrepreneurial hotbed” and that it also played a role in the expansion process.

Northern and Southern Exposure

Of course, Arizona has long counted its brother and sister to the North and South — Mexico and Canada — as global business family partners. These efforts continue today.

Glenn Williamson has experienced success in the international business market. He’s founded, sold and run various enterprises, but today he’s gunning for Arizona to build successful partnerships and business relationships with Canada. Much like Canada’s wide-open lands, the opportunities are vast.

“Our primary goal is to push bilateral trade between Canada and Arizona to the $5 billion mark by the end of 2008,” says Williamson, founder and CEO of the Canada Arizona Business Council (CABC). “We are well on our way to achieving that goal.”
Canada is Arizona’s No. 2 global trading partner behind Mexico. In 2006, according to U.S. Department of Commerce numbers, Arizona exported more than $5.3 billion worth of goods to Mexico compared to just more than $1.8 billion to Canada.

Williamson says the CABC has several primary goals. First, besides significantly increasing the trade between the two countries, the CABC is seeking a direct flight between Montreal and Phoenix, while also upgrading the seasonal flights between various Canadian cities and Arizona. Then, there is fostering the huge impact of Canadian residents who are interested in, or already are, doing business in Arizona.

“Gov. Janet Napolitano gets international business, the tourism folks get it, Tucson gets it and the Arizona Department of Commerce gets it,” Williamson says. “Now, we have to convince everyone else.”

Williamson is quick to praise statewide efforts such as AGN and calls statewide leaders, including ASU President Michael Crow, key catalysts to pushing Arizona onto the international business stage.

“ASU is huge in these efforts,” he adds. “We need their brainpower to make this successful. Everything is pointing in the right direction, but we need to put the pedal to the metal.”

International EDU

Besides Crow’s intensity at ASU and the hotbed of activity at SkySong, which Julie Rosen, ASU’s assistant vice president for economic affairs, touts as an atmosphere of “unparalleled opportunity,” other educational institutions in Arizona are aiming for the international business beacon.
Consistently ranking in the top echelon of international business schools, the Thunderbird School of Global Management has operations in Latin America, Asia, Europe and Russia. The school has forged public sector partnerships like those with ASU to better compete in the international education arena. Over the past two years, Thunderbird has pioneered significant relations with ASU, especially ASU’s West campus and the School of Global Management and Leadership (SGML).

In addition, the Arizona Department of Commerce has foreign trade offices in London, Mexico and Japan, as well as investment offices in Ireland, Japan and Hong Kong.

“Broadly, business executives and community leaders recognize that attracting out-of-state and foreign direct investment and business, as well as increasing trade, should receive significantly more emphasis to secure Arizona’s growth and provide good, well-paying jobs,” notes Gary Waissi, dean of the ASU SGML. “There are several organizations with advanced initiatives working aggressively on these areas.”

ASU, GPEC, AGN and others are continually pushing for increased international business opportunities in Arizona. But, as Arizona Department of Commerce Director Jan Lesher points out, while exports and international business opportunities continue to increase in the state, there is a baseline that needs to be established before Arizona can truly “go global” now and into the future.

“Arizona companies need to establish first a solid domestic market, and then consider expanding to national markets,” she says. “International customers can be ideal for Arizona-based businesses; however, this is a decision that needs to be done carefully — international means a company must have the resources, market know-how and commitment to stick with it.”

It’s a point not lost on those who, like Lesher, are continually working to cultivate these relationships.

“It is all about recognizing that in today’s world, business is truly global,” Waissi says. “And at the same time knowing there is a need to strategically diversify in select industries.

For more information visit the following websites:

azcommerce.com
gpec.org
commerce.gov