Transcript No Slide Title
Globalization for U.S. Companies
USFCS Brazil
19 Nov 02
How the U.S. Government helps American companies make more money overseas.
Crocker, U.S. Embassy Brasilia 1
Table of Contents
USFCS Brazil
Who I am and what I do.
What is the current trading climate?
What macro factors do U.S. companies need to pay attention to?
Why should most U.S. companies pay attention to world trade issues?
What challenges do U.S. companies face specifically?
What U.S. Government resources are available to help companies face these challenges?
How does the U.S. and Foreign Commercial Service help U.S. companies?
What other resources should U.S. companies consider?
Questions.
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Who I Am and What I Do
USFCS Brazil
Dan Crocker LFM ‘97 - MBA, MS, MIT.
Currently Commercial Attaché at U.S. Embassy, Brasilia.
Private sector work experience with Schlumberger, Brenco, Hewlett Packard, HomeWarehouse.com, and Webvan.
Public sector work experience at U.S. Embassy, Santo Domingo.
Fluent in Portuguese, Spanish, and French.
Have lived and worked in Angola, France, Italy, Dominican Republic, and Brazil.
Top-secret clearance from U.S. Government.
BSE Princeton ‘89, MA Foreign Affairs University of Virginia ‘95.
Married with two children.
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Current Trading Climate
USFCS Brazil
Generally good, in spite of global recession.
U.S. Government is committed to the principle that free trade leads to sustainable economic development.
U.S. companies should NOT assume that most countries will subscribe to further trade liberalization.
U.S. companies need to be equipped with country-specific knowledge.
Example one: giving a penknife as a gift to a South American business partner.
Example two: hedging against a Mexican peso devaluation in the mid-90’s.
But most importantly: the U.S. is open for business, and that forces most U.S. companies to be global competitors.
U.S. trade barriers are low.
U.S. dollar is strong.
Multiple examples of U.S. industries dying within a short time period due to international competition.
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What Macro Factors should U.S. Companies Watch?
USFCS Brazil
Trading Blocs or WTO?
Bilateral or regional trade agreements?
Longitudinal measures that show sustainable economic development, e.g. per capita GDP (PPP) and Gini coefficient.
Internal security problems.
Basic financial solvency measures (read
But remember:
The Economist
).
Macro is long term by definition.
Regional security problems - few countries are islands.
All probabilistic - can’t assume, for instance, that internal strife will lead to a financial crisis that will hurt your business.
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Why Care About Trade?
USFCS Brazil
Your upstream supply chain may benefit from sourcing globally.
Even if it doesn’t, your input costs may be sensitive to global prices.
Internet boom math: 280 million is 5% of 6 billion.
You can buffer domestic swings in demand by selling overseas.
You may need to produce in a country to sell there.
Boeing China
You may find producing overseas cheaper.
Shoes
You may save on downstream transportation costs.
BMW
No blank slates: you may already be producing overseas.
There’s not much protection for you in the U.S. market against foreign competition.
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Specific Challenges for U.S. Companies
Tariffs, duties, quotas.
Horrific tax regimes on goods and services.
Obscure regulations on labeling, measures, etc.
Lackluster support for intellectual and private property rights.
Regulations that effectively protect domestic industry or family dynasties at the expense of the consumer.
Byzantine judicial procedures when things go wrong.
Large-scale corruption.
Other countries that will go to great lengths to promote their domestic industry for public contracts.
Misunderstandings due to language or culture.
USFCS Brazil
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U.S. Government Solutions
U.S. Government is committed to free and fair trade.
Sleeves Rolled Up and On the Ground:
U.S. Foreign and Commercial Service (USFCS).
Additional:
International Trade Administration (ITA).
Market Access and Compliance (MAC).
Trade Development.
Advocacy Center.
U.S. Trade Representative (USTR).
U.S. Department of State.
U.S. Treasury.
Export-Import Bank, Overseas Private Investment Corporation.
USFCS Brazil
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U.S. and Foreign Commercial Service
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Mission: promote export of goods and services from the U.S., particularly by SME’s, and protect U.S. business interests abroad.
Organizationally housed within U.S. ITA, Dept of Commerce.
100 U.S. Export Assistance Centers throughout U.S.
Commercial Officers/Attachés are diplomats assigned to U.S. embassies in over 80 countries.
Extensive foreign national staff with solid industry experience.
Some cost recovery.
Track record - help solve problems, identify new markets.
We offer expertise and access.
Performance measure - success stories.
Variety of publications and tailored services.
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Other Resources for U.S. Companies
USFCS Brazil
Generally: USFCS is a good starting point.
For financing: look at Ex-Im Bank, OPIC. Very case-specific, so best to contact local USEAC.
www.usatrade.gov
Multilateral lending agencies, especially for infrastructure or development: World Bank, Inter-American Development Bank, Asian Development Bank.
Best to develop working relationship with Commercial Officers in all countries in which you’re doing business. Be prepared for changes.
Already in a bind? Contact us.
Have no idea whether your widget is in demand in Elbonia? Check out our sector-specific analyses, available through the web at www.stat-usa.gov
.
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Questions?
Contact Info: Dan Crocker Commercial Section U.S. Embassy, Brasilia 55 (61) 312-7249 [email protected]
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