Under Secretary of Commerce For International Trade Francisco SÁnchez
Florida Chamber of Commerce
2012 International Day Event
Florida State University Conference Center
Tuesday, February 7, 2012
As prepared for delivery
Thank you Mark (Wilson) for that kind introduction and for your outstanding contributions to Florida.
Allow me to also recognize Governor Scott, and the host of other dignitaries who are taking part in today’s program.
I appreciate the opportunity to be a part of this distinguished group.
Finally, I want to thank all of you, the supporters and partners of the Florida Chamber of Commerce for your leadership.
It’s always good to see so many friends. And, it’s a pleasure to be back at Florida State University, especially during FSU day at the capital.
As many of you know, I attended Florida State as both an undergrad and a law student.
This is a very special place for me. I have a lot of great memories here. And, this campus represents an important turning point in my life.
I actually started college at the University of Florida. And, as it turns out, my freshman year was an election year.
There was a race for Governor. So, I was always reading about issues and learning about the candidates.
At the time, I was a busboy at the Blue Key Banquet at UF. And, one day, there was a forum. All the candidates for Governor were in attendance. One of them was Bob Graham.
I had learned a lot about Bob Graham in my reading about him. And, I liked what he was doing.
So after the banquet, I went right up to him and told him I wanted to work on his campaign.
He wrote my name in his now famous notepad and, eventually, I became a volunteer.
And, as you know, he went on to win.
All of a sudden, I had this chance to work in the Governor’s Office at the age of 19.
It was a once-in-a-life-time opportunity; but, I couldn’t seize it from Gainesville.
It was just too far. So, I transferred to Florida State University to be in Tallahassee.
And over the next decade, while also getting my degrees, I worked my way up.
I started out as a travel aide.
I later worked for Governor Wayne Mixon at the Florida Department of Commerce.
He named me the first director of Florida’s Caribbean Basin Initiative Program.
Our goals were simple:
- To strengthen our economic ties with our Caribbean neighbors;
- To help develop new markets for Florida’s businesses to sell their goods; and
- To help these businesses capitalize on these opportunities.
I mention all of this to emphasize that, for me, shaping a more competitive Florida isn’t just a job.
It’s personal. It’s work that I’ve been committed to for decades.
And I view our talk today as a valuable opportunity to further this work together.
So, I’m glad we’ve gathered here, especially at this critical moment.
We’ve faced significant economic challenges in recent years. The financial collapse that began in 2008 sent our economy into a tailspin.
4 million jobs were lost in the six months before President Obama took office. Another 4 million jobs were lost during his first six months in office — before his policies took place.
But the good news is that we’ve come a long ways since those dark days. Last week’s job numbers were another bright spot.
The unemployment rate in January fell to 8.3 percent. Private sector payrolls increased by 257,000. This was the 23rd straight month of private sector growth. In total, this represents 3.7 million jobs.
Naturally, all of us in the Administration are happy that people are finding work. But, we know that more needs to be done.
We faced an historic economic crisis that developed over years. Our recovery won’t happen overnight.
And, as we look ahead, we all face a choice.
Do we allow the country to go back to the old ways of business?
Where economic growth was built on housing and financial bubbles?
Or do we want to forge a new path — where opportunity reaches all communities thanks to an economy built to last?
The answer is clear: We need an economy built to last.
And, in his recent State of the Union, the President unveiled his blueprint for an economy built to last.
It’s built on:
- American energy;
- skills for American workers;
- a renewal of American values; and
- American manufacturing.
As an official from the Department of Commerce, I want to spend a little time focusing on American manufacturing.
It’s a priority for us. And it’s important.
Historically, manufacturing has been a ticket to the middle class. It’s been a backbone of the American economy.
It’s also been a source of innovation. As Commerce Secretary Bryson often says, 67% of all the business R&D in America is done by manufacturing companies.
Unfortunately, for quite some time, manufacturing has been leaving our shores. And many were convinced that this was an irreversible trend.
But, President Obama did not accept this fate. And, we are seeing some very positive news coming from the manufacturing sector.
Hundreds of thousands of manufacturing jobs have been created in the last two years. In fact, 50,000 of these jobs were created in January alone, according to the latest jobs report.
Profits are up. Productivity is up. So, good things are happening. And, the President is determined to keep the good news coming.
As part of his blueprint for an economy built to last, he proposes:
- Lowering the tax rate for companies that manufacture and create jobs right here at home; and
- Adding incentives for companies that invest in research and development, enhancing our country’s innovation.
These are the kind of steps that are critical to our recovery. Our nation’s greatest resource is people.
American entrepreneurs are a constant source of ingenuity. American workers have thebest work ethic.
So by supporting the manufacturing sector, we will see:
- more innovation;
- more American jobs; and
- more products made here at home.
This is important. The words “Made in America” still represent quality and excellence.
These products are in demand all over the world. So, producing more of them would strengthen our economy.
But, that’s not the whole story. Businesses also have to sell them. That’s where I come in.
As the Under Secretary for International Trade, my job is to help U.S. businesses sell their stuff in the overseas markets.
The simple truth is this:
If more companies don’t embrace these opportunities, our nation won’t be able to compete in the 21st century economy.
Imagine if all of us had friends who wanted to open up a store in Governor’s Square Mall.
But, they told us that they wanted to ignore more than 9 out of every 10 customers that walked by.
What would we all think? Could that business reach its full potential? Could it even be competitive?
Of course not.
But, that’s exactly the situation U.S. businesses find themselves in when they don’t export.
That’s because 95 percent of the world’s consumers live outside the United States.
Also consider that, according to the IMF, 85 percent of the world’s growth over the next five years will be abroad.
Furthermore, data shows that exports strengthen businesses.
From 2005-2009, U.S. small- and medium-sized manufacturers that exported experienced revenue growth of nearly 40 percent. Those that didn’t export saw revenue decline 7 percent.
So the benefits of exporting are clear:
- more customers;
- more exposure to growth markets;
- more access to purchasing power; and
- healthier businesses.
And, I know that many of the local businesses here recognize this.
In the first half of 2010 — the latest data available — the Tallahassee metropolitan area exported goods totaling more than $60 million. And in Florida overall, export shipments of merchandise in 2010 totaled more than $55 billion.
Yet, despite all this, only 1 percent of U.S. businesses export. Of those that do, 58 percent export to just one market.
Clearly, this is not enough. We can do so much more.
That’s why two years ago, in his State of the Union Address, the President announced the National Export Initiative.
The goal is to double U.S. exports by the end of 2014. I’m proud to report that we are on track to meet our NEI goals. The totals for 2011 won’t be out till the end of the week. But up to November — exports were up more than 15 percent.
Why is this important?
Because exporting helps businesses sell their stuff. And, selling stuff helps strengthen bottom lines. And, strong businesses put people to work.
In 2010, U.S. exports supported 9.2 million jobs.
We are happy with these results. But, we aren’t satisfied.
And, we will continue to work to increase exports and enhance U.S. competitiveness.
We do this in a number of ways.
One is by strengthening our economic ties with the rest of the world.
For example, for this area particularly, stronger ties with the Western Hemisphere make for a natural partnership.
We are linked by geography, common values and mutual interests. We should work together to build a brighter future through trade.
Consider two of the three trade agreements recently signed into law.
Colombia is the third largest economy in South America. The trade agreement will provide significant new access to a $166 billion services market.
And, Panama is one of the fastest growing economies in Latin America — with annual growth above 5 percent expected through 2015.
There is so much potential. That’s why we are committed to eliminating obstacles to freer and fairer trade with countries.
And, level-playing fields are good for American competitiveness.
We are also committed to developing sector-specific strategies to enhance opportunities.
For example, a few weeks ago, the President was in Orlando to announce new initiatives to boost travel and tourism.
In 2010, nearly 60 million international visitors helped the tourism industry generate over $134 billion dollars. Tourism is the number one service we export.
Florida is a big part of these numbers because it’s a top tourist destination. So the President unveiled a new tourism strategy which, among other things, would cut out a lot of the red tape that some influential visitors have to endure.
This will boost tourism and boost local economies because more money will be spent renting hotel rooms and buying souvenirs.
And, that’s good for American competitiveness. One final initiative I want to mention is our work to enhance supply chain competitiveness.
There are incredible opportunities to get in on this action.
For example, in aerospace, projects such as Bombardier’s C Series jetliner can create new opportunities for U.S. firms to participate in a supply chain worth billions of dollars.
In this case, the supply chain starts in Canada, goes through the United States and ends up in Mexico, creating opportunities for companies along the way.
Another example is the auto industry, where there is plenty of potential.
For example, to make GM cars, some auto parts cross the border as much as seven times before final assembly.
The bottom line is this: Behind many of the great products we see is a supply chain of parts from around the world.
American companies should always be a key part of this economic activity. But, businesses have told us that there are great obstacles to doing this work.
A quick example: Our nation’s crumbling infrastructure makes the process inefficient.
Competitiveness depends on the smooth and rapid movement of goods through the supply chains — from beginning to end. Any chokepoint can result in delays, lost sales and higher costs.
To address these challenges, last November, Secretary Bryson and I announced an Advisory Committee on Supply Chain Competitiveness. Working with stakeholders, we will carefully examine these issues and work to address them.
That’s because a more efficient supply chain is good for competitiveness.
U.S. businesses deserve to be free of unnecessary obstacles and red tape.
U.S. entrepreneurs deserve a level playing field to compete on.
U.S. industries deserve the appropriate support.
The U.S. will benefit from stronger ties with partners around the world.
All of this work will boost U.S. exports.
That’s good because — as I said before — this means:
- more customers;
- more exposure to growth markets;
- more access to purchasing power;
- and healthier businesses.
These are the ingredients for a stronger American economy.
And, I look forward to working with many of you to:
- sharpen our competitive edge …
- generate growth for U.S. businesses …
- and support jobs for the American people.
Once again, thank you to the Florida Chamber of Commerce for hosting this important event.
I look forward to our discussion today.
And, I really look forward to our partnership tomorrow, and beyond, so we can shape a stronger Florida and United States of America.
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