Your background is in international banking and business. What are some of the challenges of trying to attract international business to Connecticut?
Several factors come into play:
1) It is extremely important that the state maintain a high level of visibility in key markets so as not to miss on potential opportunities. This can only be achieved via a consistent overseas marketing effort, which unfortunately for a number of reasons (budget cuts, lack of support, lack of staffing) our state has not had in some time. The MetroHartford Alliance is the perfect conduit to pursue this initiative in light of its leadership role at the state level on issues such as corporate taxation; economic competitiveness; skilled work force and so many others.
2) Incentives, costs and tax structures. These are the same issues faced by our local industry and extremely relevant in the decision making process of a firm determining where to locate in the U.S.A., especially since we will be compared to other states.
3) A number of other factors (skilled labor force; transportation network; quality of life, etc) also come into being when such a decision is contemplated.
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According to a 2007 survey, 35 percent of Connecticut companies are involved in some form of international trade. What country is Connecticut ’s most lucrative partner?
Canada is our largest trading partner as it absorbs almost 12 percent of all our exports; the top five markets (Canada, France, Germany, Mexico and UK) account for 46 percent of all export sales; exports to China and Mexico have doubled in the last four years; Germany is probably the largest investor in Connecticut in terms of locally based companies owned by a German parent.
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Your focus is on Italy. What makes Italy attractive as a potential partner for Connecticut businesses? Why should they target Italy?
Italy’s economy is the 5th or 6th largest in the world and yet Italy ranks 22nd as an export market for Connecticut products. I found this number surprising: we sell $150,000,000 in goods to Italy and that number has not changed in four years. Additionally we have been able to identify a number of regions in Italy which have the same economic profile as our state and utilize the cluster concept that Connecticut has been using. Veneto is one such region. We have been in contact with their NYC based representative who has visited our region (and written three featured articles about Connecticut) and their economic emphasis is in the same areas: aerospace; precision manufacturing; bio medical. We hope to create an environment where our companies and theirs can increase their contacts and exchanges.
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The trend with companies doing export seems to be businesses that have long been involved in overseas trade. Is it difficult for new businesses to get involved? Is it some kind of closed-door club that is difficult for businesses to open?
New-to-export companies face a number of challenges: foreign markets are not easy to penetrate; non-payment risks are greater or at least more complex; currency movements can affect the price of your goods and competitiveness. But most of all export markets require substantial investments in time and money and a strong and consistent commitment to be in it for the long run.
It should, however, be noted that new-to-export companies have local access to services provided by a number of government agencies (Department of Commerce), private institutions (banks, attorneys, accountants), etc. which can greatly facilitate this process and minimize risks.
