January 1, 2008

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Reaching Out to the World

Exports from Utah Add an Unseen Boost to Local Economy

Heather L. King

January 1, 2008

Those who call Utah home are fond of touting the state’s virtues – natural wonders including powder days, red rock cliffs and a salty lake, a highly educated multi-lingual working population, and good family values – all of which accounts for much of the state’s success in attracting companies here. But you may wonder how these qualities affect the state’s reputation around the world as local businesses send their products worldwide. It’s a question that quite a few Utah companies have sought answers to and been rewarded handsomely. Lew Cramer, president and CEO of World Trade Center Utah, has worked with a number of companies – Martin Doors (garage doors), Petersen Inc. (large-scale metal fabrication), Wencor (aircraft parts), Orbit Irrigation Products (irrigation and watering products) and FatPipe Networks (technology) to name just a few – to help get international contracts that, in some cases, generate more income from overseas exports than national sales. And that’s a trend that’s likely to continue based on the focus Gov. Jon Huntsman has placed on international business. According to the Governor’s Office of Economic Development (GOED) International Trade & Diplomacy Office, Utah’s merchandise exports in 2006 were an estimated $6.8 billion, an increase of nearly 13 percent over 2005. Gold is Utah’s largest export at 42 percent, but because that commodity does not produce a significant number of jobs in the state, other exports are becoming increasingly important to Utah’s future. GOED Executive Director Jason Perry lists energy products, advanced composites, the IT industry, medical devices, brine shrimp and agriculture exports as products that are putting Utah on the map internationally. “One of the most important pieces of our future economy has to do with advanced composites,” Perry says. “In our state, we are particularly good at combining fiber and resin to create something that is harder than metal but a third of the weight. Almost the entire supply chain is located here.” Advanced composites have far-reaching uses, including applications in the aerospace and outdoor industries. Perry continues, “Entire airplanes and components of aircraft all over the world are made from these composite materials, and the expertise really resides here in Utah. They’re making tennis rackets and skis and poles out of advanced composites as well.” Cramer sees intellectual property and the people behind the products as Utah’s most valuable export in the coming years. “The real gold in this state is in the mountains to the east, where the University of Utah is turning out some very smart bio scientists, incredible information technology experts and some of the best energy people on the planet. That’s the real gold of the future. Our competitive advantage is really in our brain power.” Cramer helped open Utah’s World Trade Center on September 11, 2006 as a symbolic gesture that he says, “sent a clear signal that Utah was open for international business, that the terrorists didn’t win and that we are merchants of peace.” The core purpose of World Trade Center Utah is to help create, promote and support Utah jobs and revenue growth from global trade. “We are at a tipping point in the Utah economy where we have the circle of strong industry, smart people, research dollars flowing in, a government that is focused on international business as well as the educational institutions that are committed to globalization and training our students for international careers,” Cramer continues. “That’s all coming together and we have created not only a one-stop-shop but a first-stop-shop. So if you’re doing international business, World Trade Center Utah should be your first stop.” Together with the chambers of commerce, GOED and USTAR, EDCU (Economic Development Corporation of Utah) as well as the universities in the state, Utah’s political and business leaders are teaming together to provide businesses an opportunity to explore the international market with powerful support. Perry explains the nuances of international trade. “We have to have the right level of government officials here meeting with the right level counterpart there just to get the introduction for our businesses. The state seal is what gets you in the door in many of the offices in the other countries. When we have a governor like Gov. Huntsman leading the trade missions, you get into places that you could never get in otherwise.” To understand the importance of the export industry to Utah, one only has to look at the statistics, Cramer says. Exports mean jobs. It’s estimated that every $1 billion in exports equates to 22,500 good jobs. In Utah, officials hope to have about $7 billion in exports in 2007, and that translates into 180,000 jobs. “One out of six jobs is dependant upon exports,” Cramer says. “We need to export to prepare our youth to compete in the new globalized world. Utah does have the skills and resources to be competitive internationally.” Utah holds a unique position in the world market because of its international strategies, according to Perry. “Utah almost has a foreign policy because we have very targeted industries and very targeted countries that we are trying to foster trade with. There are four key countries that the governor has us working on – Canada, Mexico, China and India. China and India are, without question, our fastest drawing and emerging markets for the state. We are in countries in industry clusters that make sense for the state.” Those clusters are formed around key industries that the state of Utah can compete with anywhere in the world. They include energy, life sciences, IT, outdoor products and recreation, financial institutions, aerospace and defense. Each one offers high-paying, long-lasting jobs for the state. But it’s not only products that GOED hopes to export, Perry says. “In a very real sense, these trade missions that we go on are aimed directly at getting our businesses into that international market.” Much of Cramer’s role at World Trade Center Utah is focused on a similar mission. “I like to sit down with companies and say, ‘Are you ready to export? If you are ready, let’s look at which countries make sense for you and let’s help facilitate this – Do you need financing, do you need an agent, distributors, a connection in that country?’ I try to ensure that people get connected with the things they need.”
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