Lew Cramer on China trade mission part II from Salt Lake Chamber on Vimeo.
In the second installment of our two-part discussion wrapping up the governor’s trade mission to China, World Trade Center Utah President and CEO Lew Cramer shares his thoughts on export opportunities with China, what Utah businesses have to offer and the role sports play in building international bridges.
The Utah Economic Council discussed warning signs for the national economy and emphasized Utah’s enviable position for managing through economic challenges when compared to other states. Of particular concern: increasing national debt and prices at the pump.
“This situation with gasoline prices and the debt situation has us concerned,” said Kelly Matthews, an emeritus economist formerly with Wells Fargo. “It’s clearly possible that one of these days the bond market will decide to stop buying our debt and we could have a serious situation.”
The Utah Economic Council addressed a CEO Forum sponsored by Fidelity Investments.
Last week, the S&P downgraded its outlook on the long-term sovereign debt of the United States causing alarm about the nation’s financial situation. Richard Evans, a professor of economics at Brigham Young University and a member of the Utah Economic Council, says the warning came at the perfect time.
“Constraints are good,” said Evans. “The U.S. is still the place to go to buy debt. The downgrade may instill some political will to control our spending.”
The clock is also ticking toward a decision on increasing the nation’s debt ceiling. Many say if Congress fails to raise the limit, the nation would default on commitments made to creditors. Matthews disagrees.
“If you have been listening to people who equate not increasing the debt limit with defaulting on our bonds—you have been snookered,” said Matthews. “Not raising the limit is essentially the same thing as passing a balanced budget amendment. We have plenty of money coming in to cover our bonds. We may have to cut back in other places but that’s the point of a balanced budget amendment.”
Oil prices have spiked to nearly $115 per barrel. Here in Utah, we’ve seen gas prices increase almost 30 percent over the past few months. Members of the Utah Economic Council say what many Utahns already know: rising prices at the pump have a swift and negative impact on the economy.
“Higher energy prices effect every product produced in our economy,” said Wes Curtis, a rural Utah economic development expert. “Utah is fortunate to be an energy exporter so increasing energy prices could cushion the impact that will likely be seen by the rest of the nation.”
“The last time gas prices shot up it had a dramatic effect on our economy,” said Matthews. “When we get to a certain level—maybe $4 per gallon—there will be a noticeable impact and it isn’t far away.”
The state’s top economists say Utahns shouldn’t feel completely helpless when it comes to rising fuel prices. The significant investment in mass transit, including FrontRunner and TRAX, provides a choice.
“Economics is about supply and demand,” said Juliette Tennert, chief economist in the governor’s office. “We can’t do much about the supply but we can alter the demand.”
Utah’s new junior senator, Mike Lee, spoke at this morning’s Capitol Club meeting, in the boardroom at University Hospital.
Sen. Lee has been vocal about his support for a balanced budget amendment as well as his opposition to raising the nation’s debt ceiling. He explained his position on both issues and took questions a wide range of topics from Capitol Club members.
We also had health care reform questions answered by University Health Care CEO David Entwistle.
The Salt Lake Chamber Capitol Club is composed of business leaders with a keen interest of policy issues affecting Utah’s business community. The Capitol Club meets monthly to engage with policy and business leaders regarding the most pressing policy issues of the day.
Lew Cramer on China trade mission part I from Salt Lake Chamber on Vimeo.
World Trade Center Utah President and CEO Lew Cramer accompanied Gov. Herbert on his recent five-day trade mission to China. After getting over the jet lag, he sat down to discuss what made the trip successful, the importance of networking to build international ties and utilizing Utah’s connections to open doors.
Two days ago, Staker Parson Companies received an emergency call from West Haven City, the site of its corporate headquarters. Heavy spring runoff was endangering people and property as the Weber River was flooding.
What happened next was remarkable.
Staker Parson responded with people, equipment, and materials to stop the flooding. And they were joined by two competitors–Geneva Rock and Granite Construction.
Take a close look at the photo above and what you’ll see is a Staker Parson end dump, Granite dozer, and Geneva Rock excavator.
The Chamber champions community prosperity and that is driven by our members. It’s a core value of the business community.
We can see it as Competitors in the construction industry, and all members of the Salt Lake Chamber, work together to strengthen our community.
Real Salt Lake made their mark in Mexico this week. Playing in front of a stadium filled with people in striped jerseys with “Bimbo” (a Mexican bread company) on the front, the team from Salt Lake found a way to place two goals into the back of the net. Watching this all unfold from the upper rows of the stadium was exhilarating and satisfying.
The Salt Lake Chamber business delegation has accomplished many great things this week for the Utah economy, but none more valuable than the good will that has been shared with our Mexican neighbors. One moment at the game captured this in a simple and powerful way.
Fabio Demelo is a senior executive with an international company headquartered in Salt Lake City called High Protection Company. Fabio is a U.S. citizen with Brazilian roots. He carries a spirit about him that we would all do well to emulate.
Fabio was sitting on the front row of our protected box area wearing a RSL jersey and cheering for our team the whole game. And let me tell you–that took some serious guts. Wearing visitor colors in a fan-crazed Latin American stadium is not for the faint of heart.
At the end of the game a Monterrey fan asked Fabio to exchange jerseys, a time-honored tradition in soccer. As a gesture of good will, players or fans shake hands at the end of a match and swap jerseys.
Fabio went to a fence separating our fans from theirs and threw his jersey over the fence. The Rayadas fan did the same.
The moment captured in an instance what this trade mission has been all about — making a personal connection with our southern neighbors.
The challenge that I give to other Salt Lakers is to welcome the Rayados to our city next week. But it’s more than that. We need to engage in a more civil, compassionate and constructive discussions with our neighbors to the south.
We need to swap more jerseys with Mexico.
China Trade Mission – Governor Herbert from Salt Lake Chamber on Vimeo.
Utah Governor Gary R. Herbert says Utah businesses are already starting to see the benefits of his five-day trade mission to China, and he expects to see an economic impact of $50-60 million from the visit to one of the world’s economic powers.
The governor recently returned from a including stops in Beijing and Shanghai. During his visit, the governor met with a member of the Chinese cabinet and signed an agreement with the mayor of the Jinshan district.
We sat down with the governor shortly after his return to discuss the economic benefits he expects to see for the state, how this trip will boost tourism in our state and what he learned about the rising economic power.
Editor’s note: this entry was written by Salt Lake Chamber Chief Economist Natalie Gochnour. She is in Monterrey, Mexico as part of a business delegation visiting the city in conjunction with Real Salt Lake’s game in the CONCACAF finals.
After signing a memorandum of agreement with the second largest American chamber outside of the U.S. (American Chamber of Commerce of Mexico or AMCHAM Mexico), the Utah delegation had a mind-growing experience at the Tec de Monterrey. Here we toured a business incubation center filled with young, English-speaking and globally-engaged Mexican students ready to create wealth and income for themselves and their country.
The Monterrey Technology Center enrolls 90,000 students at something like 31 campuses in 25 cities throughout the country. It is based in Monterrey, and we saw the heart of it — a technology park housing 70 micro business incubators, 33 companies and 16 business accelerators.
The offices were filled with bright, attractive and motivated designers, engineers, programmers and business students who all shared two things in common — they are young and they are entrepreneurial. It gave me a very good feeling about the future of this country south of our border.
As I watched them work on their HP, Dell and Apple computers and as I observed what they wore (clothing that was much like ours in the states), how they spoke (their English is far better than my Spanish) and what they adorned their offices with (pictures of the Jefferson Memorial, Statue of Liberty, clocks showing the time in the US), it got me thinking about our relationship with Latin America … especially when I considered the array of companies just outside the tech center that claim residence in this city — American Airlines, Starbucks, Walmart, Chilis and Boston Consulting Group, just to name a few.
What would happen if we turned our backs on this growing economy, which is the world’s 11th largest economy and predicted by Goldman Sachs to be the sixth largest by 2050?
What possible self interest could there be not forming, or worse, harming a lasting business relationship with 110 million people living just south of us?
How do we erase the unfortunate and inaccurate stereotype that some in our state have about the country of Mexico?
We talk about a “rising generation” in Utah. What I’ve seen here is a rising generation of Mexicans, where half of their population is under 27 years of age. We would do well to grow and cultivate their talent. A prosperous Mexico is our best immigration policy
I share these thoughts with the hope that all of us will use the Real Salt Lake – Monterrey Rayados soccer match this week and next (when they play at Rio Tinto Stadium) to take a closer look at our Utah-Mexican relationship. The Mexican-U.S. border isn’t going anywhere. We have two fine neighbors bordering the land of the free. I believe a careful examination will show us that we have very good reasons to embrace our Latin neighbors like never before.
Editor’s note: this entry was written by Salt Lake Chamber Chief Economist Natalie Gochnour. She is in Monterrey, Mexico as part of a business delegation visiting the city in conjunction with Real Salt Lake’s game in the CONCACAF finals.
The Utah delegation woke up this morning to a front page, below the fold article in the El Norte newspaper on Real Salt Lake’s visit to this beautiful northern Mexico city. Despite a few errors in the story — like identifying Real Salt Lake co-owner Dell Loy Hansen as the other co-owner Dave Checketts – Utah continues to receive publicity because of Real Salt Lake’s on-the-field success.
We toured the FEMSA bottling facility in the heart of Monterrey and got a good look at a state-of-the-art bottling plant. FEMSA is commonly known as the distributor for Coca-Cola in Mexico. They are also the owners of the OXXO convenience stores and many brands of beer.
Later in the day we visited with Monterrey-based venture capitalists and learned how Mexico’s rising GDP is paralleled by an improving political and regulatory environment. I will have more to say about this later.
The real surprise of the day was to see a gray Honda Civic with Utah plates on it parked at our hotel. The plates had the familiar “Stockton-to-Malone” plate frames and a call out for the Utah Auto Mall in Sandy, Utah.
It was a vivid reminder of the connectivity between this Mexican commercial center and the Beehive State. Autoliv exports airbags here, Real Salt Lake plays here, and somebody purchased a car in Sandy, Utah and drove it here.
Globalization is alive and well in the Americas.
Real Salt Lake is in Monterrey, Mexico this week preparing for the first leg of the CONCACAF championship. The final leg is at Rio Tinto Stadium next week. No, you haven’t stumbled into the sports section of our blog. The fact is, sports can be a very strong element of economic development.
We’re leading a delegation of Utah business leaders to Monterrey–not just to support RSL, but to meet with business leaders in the business capital of Mexico.
You can read the full news release HERE.
Chief Economist Natalie Gochnour is representing the Chamber (and serving as our chief international business correspondent) on the trip and is providing updates on the trip:
Sunday morning (April 17) We flew southeast on a 737 chartered jet. Once airborne, the flight only took 2 1/2 hours. Monterrey may be in a foreign country but it’s just as close as Kansas City.
After clearing security and customs, Real Salt Lake co-owner Dell Loy Hansen was surrounded by a pack of reporters asking about the big match. Dell Loy speaks fluent Spanish so he’s somewhat of a media darling. He told the Monterrey media we were delighted to be in their city for this important game. He held up a Real Salt Lake’s “Champions” scarf and answered media inquiries for about ten minutes.
In addition to the Salt Lake Chamber, the business delegation includes venture capitalists, a medical device executive, a banker, a trade representative from the governor’s office, a small business owner in Utah, and a representative of a large Utah manufacturer. Our purpose is to support Utah’s professional soccer team Real Salt Lake and extend our good will as business and community leaders to this large economy south of the U.S. border.
I’m told Monterrey is about the size of San Francisco but in appearance it looks more to me like Tucson. I can see lots of cactus and American southwest-like mountains neighboring the city. The city feels alive and dynamic. Brand name global companies dot the skyline. It is not a surprise to me that Utah companies have important ties with this part of Mexico.
During our stay, the business delegation will meet with a large Mexican manufacturer, tour the campus of one of Mexico’s leading universities and meet with the governor of Nuevo Leon. We also plan to sign an agreement with the prestigious American Chamber of Commerce here. In each of these visits, we will be working to grow the Utah economy and create jobs for Utahns. Utah exports an estimated $456 million worth of merchandise here. Most of these exports are products used in automobiles, minerals and ores, food and chemicals.
Many may find it interesting that Mexico is a growth spot for Utah exporters. In the past year, exports increased by 63 percent, making Mexico our 7th largest trading partner.
This week, Real Salt Lake becomes another export. We are exporting great soccer to a country that idolizes the sport. If Head Coach Jason Kreis has his way, RSL will not only be another \great export success to the Utah economy, we’ll import that CONCACAF trophy to Utah.
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