WTC Overview 2011_Carnahan Event

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Exporting: New Initiatives to Expand

American Business Global Market Share

August 26, 2011

Tim Nowak

Executive Director



What We Do

Facilitate economic development

through the growth of international

trade & investment

1. Trade Education and Programs2. Business to Business

Connections

3. Foreign Market Research

4. Special Projects



Training & Programs

Region’s most comprehensiveinternational-focused education

and training programs

Examples:

Export Compliance (June)

INCOTERMS (August 31st)U.S. China Trade with U.S. China

Business Council (June)

2010, these programs provided

the tools of international trade to

more than 650 peoplerepresenting 466 companies



Training & Programs

Growing Global Awards Luncheon

Established in 1998. Largest

international business event

675 attendees representing >200companies

Timely issues affecting global

business

Recognizing international businessexcellence



Business Connections

One-on-one meetingswith companies based on

markets of interest

Business site visits

Boeing, Monsanto,Express Scripts,

Savvis, Sigma-Aldrich

Congressman Carnahan

instrumental in Germanrelationships



Business Connections

Coordinate trade and investment delegations

2010 – 9 Inbound and 3 outbound delegations

China, Germany, France

Raising St. Louis’ international profile



Foreign Market Research

“Desktop” research using proprietarydata, government, industry association

and news media sources

Trade statistics – Customs data from 175

countries – by commodity, classification,

and code

Buyers and Suppliers – Identify and connect

Academic Advisory Board partnership

to obtain top students as interns for

international projects

Washington University, SLU, UMSL, SIUE,

Webster

Local and foreign interns engaged





Establish direct airfreight connections between

St. Louis and Shanghai, China.

Increase market share of air cargo flown

between U.S. and China on St. Louis-based

Chinese freight carriers

Expand opportunities for Midwest businesses

to access new Asian markets – increased

exports

Assist China companies in establishing a major

Midwest presence from which to do business

with the heartland of America

The New China Gateway



Progress to Date

2008 Feb. 2008: Ambassador Zhou Wenzhong visit to St. Louis Mar 2008: Congressional and business delegation to Beijing - MOU with MOFCOM/CAAC April 2008: Foreign Affairs Minister Li Zhaoxing visit to St. Louis June 2008: Vice Premier Wang Qishan visit to St. Louis Dec 2008: $1.7 M EDA Planning Grant awarded to WTC & St. Louis County Economic Council

2009 Jan 2009: Ambassador Zhou visit announced Midwest-China Hub Commission (MCHC) formation Mar 2009: MCHC delegation to China – led by Mayor Slay May 2009: Chinese Investment Promotion Agency (CIPA) delegation visit to St. Louis Sept 2009: Chairman Wu Bangguo meets with U.S. Senators Bond and McCaskill Nov 2009: Commission - China Overseas Investment Fair in Beijing Dec 2009: Chinese Embassy (Washington, D.C.) hosted dinner in honor of Hub Commission

2010 Feb 2010: Ambassador Zhou attended state dinner hosted by Governor Jay Nixon

Mar 2010: St. Louis Mayor Francis Slay led delegation to China June 2010: Meetings with airlines and freight forwarders in Shanghai Aug 2010: Missouri Senator led delegation to Beijing and Shanghai Nov 2010: CAAC / CATA delegation with China Cargo Airlines visit to St. Louis Nov 2010: All China Federation of Industry and Commerce (ACFIC) delegation



Progress



Delegation led by U.S.

Senators Kit Bond and

Claire McCaskill

Meetings with Chinese Air

Transportation Association(CATA) and Chinese airlines

Memorandum of

Understanding signed

Future visit in Fall by Civil

Aviation Administration of

China (CAAC) and Chinese

airlines

Aug 2010 Delegation



Chinese delegation visits St.

Louis per MOU signed in

August

Led by CATA and CAAC

Visit includes reps from

Air China

China Southern

China Eastern / China Cargo

Next step - Chinese airline to

negotiate agreement

Nov 2010 Delegation



China Cargo, a subsidiary

of China Eastern, declared

as the carrier to negotiate

with Lambert-St. Louis Int’l

Airport

Follow up trip to China by

Lambert representatives

Flights tentatively

scheduled to begin in 4th Q

2011.

Jan 2011 Announcement



Delegation visits St. Louis as

part of President Hu Jintao

state visit to United States

Shanghai Foreign

Investment DevelopmentBoard (FID) – Jan and May

2011

Memorandum of

Understanding - Mutual

Cooperation

Formalize trade and

investment relationship

between St. Louis and

Shanghai, China

Jan & May 2011 Shanghai FID



China Cargo teams visit St.

Louis – May and July, 2011

Further negotiations and

technical data gathering

Meetings with Latin

American carriers

Shared goal – Flights by end

of 2011

May / July 2011 China Cargo



Midwest--The Heart of America

20 states – 1.3 million square miles

130 million people – 43 percent of total U.S. population

Combined gross state products of $5.2 trillion – 40 percent of U.S. GDP

52 percent of total U.S. manufacturing employment and 53 percent of total U.S. gross

manufacturing product

Headquarters for 233 Fortune 500 companies



Win – Win Strategy

Expand bi-lateral trade & investment

Supports China’s “Go Out ” policy, 12th

Five year plan

– Raise brands up value chain with

presence in U.S. Creates demand for MO products in

China

Creates jobs and economic opportunity

- Repositioning St. Louis in the global

economy



Backhaul Research

St. Louis Commerce Magazine, January 2011



500 Mile Catchment Area

Potential Reach for STL

1. Missouri

2. Illinois3. Indiana

4. Ohio

5. Kentucky

6. Tennessee

7. Alabama

8. Mississippi

9. Arkansas10. Oklahoma

11. Kansas

12. Nebraska

13. Iowa

14. Wisconsin



Catchment Shippers by State

Key Indicators

1. 67,593,993 KG (2010)

2. 1,299,884 KG per week

1,299 metric tons per week

Top 7 states account for 89% of all

Midwest airfreight to China

Illinois and Ohio are largest airfreight

shippers to China

Origin of Movement Data

Source: WISER Trade, US Census FTD, WTC Research

Rank State ANNUAL 2010

TOTAL ALL STATES 67,593,993.00

1 Illinois 15,789,921.00

2 Ohio 13,943,058.00

3 Wisconsin 10,077,629.00

4 Indiana 8,528,614.00

5 Kentucky 4,238,838.00

6 Missouri 4,212,767.00

7 Tennessee 3,669,215.00

8 Iowa 1,651,603.00

9 Alabama 1,350,583.00

10 Arkansas 1,105,043.00

11 Nebraska 903,266.00

12 Oklahoma 835,418.00

13 Kansas 817,511.00

14 Mississippi 470,527.00



Catchment Shippers by Commodity

Key Indicators

1. 67,593,993 KG (2010)

2. 1,299,884 KG per week

1,299 metric tons per week

Top 20 products account for 26% of all

Midwest airfreight to China (YTD)

Top 100 products account for 58% of

all Midwest airfreight to China (YTD)

Origin of Movement Data


Rank Code Description ANNUAL 2010

TOTAL ALL COMMODITIES 67,593,993.00

1 841490 Air/Gas Pump, Compressor And Fan Etc Parts, Nesoi 2,477,427.00

2 840999 Spark-Ignition Reciprocating Int Com Pistn Eng 1,870,239.00

3 280461 Silicon Contain By Wt Nt < 99.99% Of Silicon 1,149,215.00

4 870810 Bumpers And Parts, For Motor Vehicles 1,083,900.00

5 940190 Parts Of Seats (Ex Medical, Barber, Dental Etc) 1,079,565.00

6 382200 Composite Diagnostic/Lab Reagents, Exc Pharmaceut 832,438.007 841480 Air/Gas Pumps, Compressors And Fans Etc, Nesoi 809,883.00

8 854411 Insulated Winding Wire Of Copper 775,209.00

9 850440 Static Converters; Adp Power Supplies 766,914.00

10 853890 Pt F Elect Appr F Elect Circt; F Elct Contrl Nesoi 750,395.00

11 854449 Insulated Electric Conductors =< 80 V Nesoi 716,473.00

12 722550 Flt-Rld Oth Alloy Stl 600mm Om W, Cld-Rld 690,013.00

13 732020Helical Springs Of Iron Or Steel 653,129.00

14 841350 Reciprocating Positive Displacement Pumps, Nesoi 640,459.00

15 853669 Elect Plugs & Sockets F Voltage Not Over 1000 V 639,011.00

16 848180 Taps Cocks Etc F Pipe Vat Inc Thermo Control Nesoi 613,741.00

17 880000 Civilian Aircraft, Engines, And Parts 598,677.00

18 900190 Lenses Prisms Mirrors Optcl Elmnt N Optically Work 535,447.00

19 901819 Electro-Diagnostic Apparatus Nesoi, And Parts Etc. 535,139.00

20 870880 Suspension Shock Absorbers For Motor Vehicles 534,815.00



Catchment Exports Growing to China

•

Exports growing since 1998 (with the unique exception of 2009)• CAGR = 19.75% since 2001 (10 years)

• China is now United States’ #1 airfreight customer




July 2009 to June 2010Export / Import in KG

Air Freight Returns to China with ¼ of Imported Weight

0

50,000,000

100,000,000

150,000,000

200,000,000

250,000,000

ORD DFW ATL

30.1% 19.3% 23.2%

Average 26.7%

0

200,000,000

400,000,000

600,000,000

800,000,000

1,000,000,000

1,200,000,000

US Exports US Imports

US Backhaul 23.1%

Exports Imports

Source: US Census, WTC Research, WISER Trade



100% (100,000 KG) 14/week (720/year)

50% (50,000 KG) 28/week (1,439/year)

35% (35,000 KG) 40/week (2,056/year)

100% (100,000 KG) 7/week (360/year)

50% (50,000 KG) 14/week (720/year)

35% (35,000 KG) 20/week (1,028/year)

100% (100,000 KG) 5/week (252/year)

50% (50,000 KG) 10/week (504/year)

35% (35,000 KG) 14/week (720/year)

100% (100,000 KG) 3/week (180/year)

50% (50,000 KG) 7/week (360/year)

35% (35,000 KG) 10/week (514/year)

100% (100,000 KG) 1/week (72/year)

50% (50,000 KG) 3/week (144/year)

35% (35,000 KG) 4/week (206/year)

% of

Catch Area KG

% of

Plane Capacity KG

Equivalent Number

of Flights

100% of Catchment Area Export = 71,972,726 KG

Catchment Backhaul – 2011 Estimation


100%

50%

35%

25%

10%



“To have a direct transportation hub from St. Louis to China will really position St. Louis as a hub of

international trade. We are proud to have provided an almost $2 million grant from the

Department of Commerce's EDA to help on the feasibility and engineering aspects of this project.”

United States Secretary of Commerce Gary Locke

September 24, 2010

Summary



“…let us make Missouri, let us make the Midwest United States a new

starting point for our future development.”

Chinese Vice Premier Wang Qishan

June 16, 2008

Summary

Documents

WTC Overview 2011_Carnahan Event