Thank you, Suzanne Clark, for that kind introduction, and congratulations on being the first female Senior Executive Vice President of the U.S. Chamber of Commerce, in its 104-year history. It is my pleasure to be here. Thank you for inviting me.
To the governors in the room, welcome again to Washington, D.C. Welcome, also, to all of the foreign investors and representatives of foreign governments in attendance. For those of you who work for foreign companies that have invested in the United States, thank you. Your commitment to the U.S. market has been instrumental in re-invigorating it. You have helped create millions of jobs for people in every state in the union.
At the U.S. Department of Commerce, at the White House, and at every federal agency, we are focused on making the United States the best place in the world to invest and to run a business. We are strengthening the American industrial base; enhancing our system of innovation; and revitalizing the reality of the American Dream.
We are doing this in partnership with industry, academia, labor, our foreign business partners, and, most importantly, in collaboration with the states and governors.
And now — more than ever before — America is open for business.
For those companies that are producing products in the United States, we are diligently working at creating a level playing field and a system of reciprocal trade that will enable you to sell more products everywhere in the world.
Our efforts on trade — and so many other facets of economic policy — are paying off.
After more than a decade of stagnation, the U.S. economy has entered a virtuous cycle of economic growth. U.S. manufacturing employment has increased by almost 500,000 jobs since President Trump was elected, the most job growth in this essential sector of the U.S. economy in more than two decades.
Optimism among U.S. manufacturers — as measured by the National Association of Manufacturers — has never been higher, reaching a record 92.4 percent in 2018. The U.S. GDP is growing at a healthy clip of more than 3 percent, a rate that no one predicted a few years ago.
New shipments of durable goods increased by an impressive 7.3 percent in 2018, and new orders were up by 8.1 percent, boding well for the rest of 2019.
Our corporate tax rate is now globally competitive. And, importantly, we initiated 176 deregulatory actions in 2018, with three-times the savings to American businesses as was achieved in 2017.
We have created a high-powered American Workforce Policy Advisory Board to help solve the number-one issue confronting our fast-growing private sector: the shortage of highly skilled workers. I co-chair this Board with Ivanka Trump, and we have two governors — Eric Holcomb of Indiana, and Kim Reynolds from Iowa — on the board, along with some of the nation’s most important CEOs. There are also leaders from educational organizations, labor unions, and trade associations, including your own Tom Donohue. The Advisory Board will provide input as we implement our first-ever comprehensive national workforce strategy.
And we are doing so much more to make the United States the premier destination for investment.
We have renegotiated NAFTA, replacing it with the U.S. Mexico Canada Agreement, with the intention of bringing production and jobs back to the United States.
Our negotiations with China have already addressed many of the outstanding issues we face with them. So, President Trump is willing to extend a bit the deadline on tariffs to see whether we can achieve an enforceable agreement in an ultimate session at Mar-a-Lago.
If not, we will go forward with the original plan to raise tariffs on $200 billion of imports from 10 percent to 25 percent. And, meanwhile, the 25 percent tariff on $50 billion in Chinese imports will remain in place.
At the Commerce Department, our assets located in 100 U.S. cities and in 75 foreign nations stand ready to encourage foreign direct investment in the United States. Our U.S. Export Assistance Centers, located throughout the country, have been directed to identify and eliminate foreign barriers to exports for our local producers. These export assistance centers also have been instructed to work on attracting FDI, and to champion domestic business expansions. The export assistance centers work directly with 1,400 U.S. Foreign Commercial Service Officers located in 75 different countries.
Getting new investment deals over the finish line requires coordination between the states and with federal officials like myself and the President.
Our Foreign Commercial Service officers here and overseas are also involved in organizing delegations of foreign business executives to attend the SelectUSA Investment Summit and to promote FDI and U.S. export sales as well. This annual event will be held at the Washington Hilton Hotel, just up Connecticut Avenue, from June 10th through 12th.
The SelectUSA Investment Summit is the country’s largest national gathering of state Economic Development Officers. Last year, we welcomed 1,000 international investors from 66 markets and hosted economic development organization representatives from 51 states and territories. A record 10 governors participated themselves in last year’s Investment Summit, and we expect to double that number this year. State Economic Development Organizations held more than 2,700 individual meetings with foreign companies at the Summit to discuss investment opportunities.
To quote Mississippi’s Governor, Phil Bryant, regarding his participation at the Investment Summit: “I am able to accomplish more in three days at the Investment Summit than I can in multiple trips overseas.” And — I might add — with no jet lag!"
For the state delegations here today, if you are serious about FDI into your state, this is the one event you need to attend every year. Many states sponsor individual FDI events with foreign delegations directly preceding or succeeding the SelectUSA Investment Summit. This has proven very effective and, if you wish to schedule one, we will get the word out to the participants in advance of the Summit.
These efforts are generating great opportunities for local economies. Last year, SelectUSA worked with clients from 91 global markets, who announced 449 greenfield investment projects in 49 U.S. states and territories. These projects were valued at $32 billion and supported 57,500 U.S. jobs.
As the host of the two most recent SelectUSA Investment Summits, I have worked directly with more than a dozen governors, connecting them with CEOs of foreign companies both large and small interested in expanding their footprints in the United States.
At last year’s SelectUSA Summit, Barbara Humpton, CEO of Siemens USA, told me that the United States has, and I quote: “all the right conditions to invest here.” She noted that the United States has abundant natural resources; the rule of law that protects her company’s most important intellectual assets; the world’s most skilled and educated workforce; and an entrepreneurial spirit that, and I quote, “is really driving change.” She told the audience of potential foreign investors that, “If you come to the United States, you’ll find an innovation engine that is unrivaled by others.” And, she added: “We’re looking to invest even more here and use this as an engine in order to drive global growth.” She invited the attendees to “come and join us.”
The United States is home to the largest amount of FDI in the world — more than $4 trillion in cumulative FDI stock and, of that, $277 billion came in in 2017 alone. Last year, the United States topped the A.T. Kearney FDI Confidence Index for the sixth year in a row.
And there are other avenues for private investment in public projects. At the infrastructure breakout session with Governors this morning at the White House, there was some confusion about the potential role of public – private partnerships.
My view is that equity capital is inherently costlier than Treasury or tax-exempt debt financing. Therefore, I divide infrastructure projects into three buckets. The first consists of those projects with a well-defined and predictable revenue stream. Those have no need for equity from the private sector.
At the opposite end of the spectrum are those with no real revenue stream, but are necessary for public-policy reasons. Those must be financed 100 percent from otherwise available government funding.
The third category are those projects with potential revenue streams that are maybe somewhat unpredictable. These might well need equity as a cushion, so that debt financing would be available for part of the total. Private capital could be the solution for these needs because equity capital has greater risk tolerance if there is also the prospect of higher returns.
In any event, we believe that infrastructure and construction will generate more than $100 billion of new private investment in some 8,700 distressed communities because of the new Opportunity Zones. We hope that all companies will avail themselves of the tax advantages that are provided for establishing operations in these zones.
Finally, let me mention that in the near term, the U.S. Mexico Canada Agreement will be up for a vote in Congress this spring. Its passage will deliver significant economic benefits to all businesses in all of the states, from farmers, to high-tech and digital commerce innovators, and local producers of thousands of different products and services. USMCA is a win, win, win — for Mexico, Canada, and the United States. It will generate a new era of North American investment.
Thank you, again, for everyone’s commitment to the U.S. market, to American workers, and to a truly dynamic American culture that — with your involvement and your investment — continuous to reinvent itself.