We at the International Economic Development Council (IEDC) are encouraged by the House’s bipartisan focus on attracting foreign investment to America. IEDC, the largest organization of economic development professionals in the world, prioritizes FDI as a means to economic prosperity and has been a key theme during my term as chairman of the Board. As the legislation itself notes, FDI provides 5.6 million jobs for Americans, most of which are high skilled and pay above average salaries. At the same time, traditional blue collar bastions of our economy also benefit. Foreign companies operating in the U.S. employ 15 percent of the manufacturing sector. FDI unmistakably gives back to America further in providing $41 billion for R&D, 14 percent of total corporate tax revenue and 5.8 percent of the American GDP.
Unfortunately, the recent recession damaged this pillar of economic development. America’s share of FDI is shrinking in comparison to other nations. The recovery of foreign investment in America is too slow for significant economic development and the millions of Americans in need of jobs to support their families and pursue the American dream. We must act decisively now to turn the tide of investment back to our shores.
SelectUSA has emerged over the past few years to tackle the monumental task of acting as America’s chief investment attraction agency. As H.R. 2052 even notes, SelectUSA exists to “promote greater levels of business investment in the United States.” SelectUSA is a boon for economic development as it directly connects capital and knowledge to firms and provides a number of services for foreign companies wishing to enter the lucrative U.S. market. For example, SelectUSA recently played a role in bringing the Canadian firm AGS Automotive Systems to Michigan, which invested $20 million in a bumper plant and created 100 new high paying jobs. In Corpus Christie, Texas, SelectUSA participated in bringing a $718 million dollar first-stage investment, and 150 new jobs, from Austria-based steel company Voestalpine. SelectUSA managed to bring about such investments with less than $1 million in annual funding. We are certain that SelectUSA will continue to take the lead in reviving foreign investment in America and set an example for both private and public organizations to aspire to, if given the resources to do so.
The President’s budget requested just $20 million for SelectUSA for FY2014, a substantial increase yet drop in the bucket compared to the $967 billion in total sought by the House for discretionary spending. The current House Commerce-Justice-Science Appropriations Bill, H.R. 2787, which funds the entire Department of Commerce, does not directly fund SelectUSA. The Senate version, S. 1329, also fails to directly fund SelectUSA. SelectUSA has done so much with so little. It has earned the support of the economic development community and deserves to be fully funded by Congress. The passage of H.R. 2052 is a clear indication of the House’s intent to support FDI attraction; now they must back up their own words by supporting the agency leading the way. SelectUSA, as the review will undoubtedly show, has laid the foundations for significantly increasing FDI in the U.S. Congress must provide the funds it needs in order to go the distance in making the U.S., once again, the top destination for foreign investment in the world. I speak for over 4,000 economic development professionals when I call on Congress, without delay, to both send H.R. 2052 to the president’s desk and insert $20 million into the FY2014 budget for SelectUSA – it is a domestic investment that will yield returns in international investment and jobs that we so desperately need.
Krutko is chairman of the Board of the International Economic Development Council in Washington, DC, and president & CEO of Ann Arbor SPARK, an Accredited Economic Development Organization (AEDO) serving Ann Arbor and the central Michigan region.