The Role of Local Governments in Supporting International Trade

Today, I had the opportunity – along with Sam Kaplan of the Trade Development Alliance – to present to the King County Council on “International Trade as an Economic Driver for King County,” and I learned a very valuable lesson: never present immediately after a discussion on a major topic like the proposed  new basketball stadium, or else everyone will leave right before you speak. Although, as I’ve said, basketball is an international trade issue for Washington, so I shouldn’t complain.

But there was actually another lesson that I wanted to share with all of you. When I prepared my presentation, I wanted to make it very clear to the Council that they had an important role to play…not just in understanding how international trade drives the economy, but in actively working to increase our state’s international competitiveness. Of course, the points that I made to them are true for all local governments, and what better place to share these thoughts than the State of Trade blog.

Here are my Top Three Ways Local Government Can Support International Trade:

1) International Trade Infrastructure Investments: The basic principle of business is the ability to get your product to market. The only difference in international trade is that the market is further away and sometimes they speak a different language. So facilitating those logistics is an essential government service. To use King County as an example, they are responsible for a number of basic infrastructure investments that not only ensure efficient multi-modal freight mobility in and out of the Port of Seattle, but also parts of the county – like the Kent Valley – that serve as essential warehousing and distribution centers.

And it’s not just roads and rail. For the Kent Valley, flood control infrastructure becomes trade infrastructure. And, as our state’s international trade becomes increasingly services oriented, it’s infrastructure that helps move people (like an airport with a good international terminal) or information (like good broadband access). All of these are often the responsibility of local governments, either using locally raised tax dollars or else attracting and programming federal and/or private sector dollars.

2) Marketing and Relationship Building: In one of the State of Trade’s earliest posts, I talked about why local elected officials are so essential to building international trade relationships. In many parts of the world, it is government officials that make a lot of the business decisions, and they like to be able to meet and do business with their peers. And so, the presence of an elected official can make or break the success of a trade mission, either one in which our businesses travel internationally or in receiving inbound delegations of foreign companies/investors looking to do business here.

But more than that, we know that states, regions and cities are always competing to attract new business – whether it be an international company looking to open an office in the United State (foreign direct investment) or a tour group looking to bring busloads of international visitors to see America. Locally funded convention & visitors bureaus, public colleges and universities and of course port authorities are using local taxpayer dollars (and other funds) to ensure that we are the beneficiaries of those dollars – through marketing, branding and relationship building with other local governments, peer institutions and businesses around the world.

3) Federal Policy Advocacy: You probably won’t be surprised to see this item on the list, since that is a lot of what I spend my time doing. But it’s also true. The need for local governments to communicate their perspectives on international trade issues to Congress and the Administration is vital, from basic organizational issues like the President’s proposed agency restructuring to key legislation that might impact the ability of local companies to succeed (such as the reauthorization of the Export-Import Bank). In fact, recently Governor Gregoire helped organize a letter – signed by 22 governors – on the Ex-Im Bank topic. Not only are these kinds of efforts by local government often highly impactful in moving the needle on legislation, but they demonstrate just how often trade issues are widely supported by a broad consensus of stakeholders. WCIT’s recent letter to the Washington Congressional delegation on Ex-Im Bank reauthorization included business, government and labor stakeholders!

By the way, I’ll be presenting these thoughts next week in DC at a joint event being put on by the Brookings Institution and the Living Cities State and Metropolitan Prosperity Collaborative, when I’m on a response panel to the CenterState New York Export Plan. In addition to sharing the points above, I’m also going to make sure to praise them for the identification of international students as a major services trade opportunity (for Washington, we get $450 million a year from foreign students studying in our state’s colleges and universities). Not to bring it back to basketball, but for the folks from Syracuse it is indeed true that Fab Melo is an example of international trade…

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