You are here

State International Trade and Investment Strategy and Related Programs

On Tuesday, March 18, 2014, a legislative oversight hearing is being held at the California State Capitol to review the state's recently released international trade strategy and be briefed by an official from the Export-Import Bank of the United States (Ex-Im Bank).

Convening the joint hearing are the policy and research committees with jurisdiction for issues relating to international trade, capital formation, infrastructure development and export and investment promotion: the Assembly Committee on Jobs, Economic Development, and the Economy (JEDE), chaired by Assemblymember Jose Medina, and the Assembly Select Committee on Asia/California Trade and Investment Promotion (ACTIP), chaired by Assemblymember Philip Ting. 

This hearing serves as a follow-up to ongoing policy initiatives of the committees on the impact of U.S. trade agreements on the California economy, infrastructure challenges to trade and global competitiveness, and commerce and tourism development within the Pacific Rim.  Outcomes from these prior activities have included the introduction of legislation, as well as activities that deepen the Legislature's understanding of California's position within the global economy.

Hearing testimony will be presented through two agenda items, presented by the state and federal government officials responsible for program delivery. 
 

  • California Trade Strategy:  Brian Peck, the Chief Deputy Director for Trade and Investment at the Governor's Office of Business and Economic Development (GO-Biz), will make the first presentation.  Mr. Peck will present on the state's recently released state International Trade and Investment Strategy (ITI Strategy).
     
  • Export Financial Assistance:  PaulDuncan is with the Western Regional Office of the Ex-Im Bank.  Mr. Duncan will outline the current Ex-Im Bank programs including how California businesses have benefited.

Growing Importance of Trade

California’s $2 trillion economy naturally functions as an independent economic power within the global economy.  In fact, compared to other nations, California has one of the 10 largest economies in the world, due to it being a top-tier trade partner, a best-in-class investment location, a high quality producer of goods and services, and the home and key access point for a massive consumer-base.  In 2013, California exported $168 billion in products to over 220 foreign countries.  While California has been significantly impacted by the recession, exports continued to increase in almost every quarter from 2010 through 2013.

Recently, the value of trade-related industries, as a component of the broader economy, was the subject of a study by the Brookings Institute and JP Morgan Chase, Export Nation 2013.  The report found that between 2003 to 2012 exports drove post-recession growth in the 100 largest metro areas including Los Angeles, San Diego, and the Inland Empire. 

The study is unique in that it collected data by origin of production rather than origin of export movement, as is the case with the U.S. Department of Commerce export data.  Using the Export Nation methodology, total California exports for goods and services in 2012 was $252 billion, as compared to the U.S. Census Bureau's 2012 number of $162 billion for goods only, as measured by origin of movement. 

In 2012, exports represented 8.8% of California GDP, based on Export Nation data.  The top five California metro areas with the highest concentration of export-related GDP in the report period include:  (1) Los Angeles (37.1%); (2) San Francisco (15%); (3) San Jose (13.7%); (4) San Diego (11.5%), and (5) the Inland Empire (9.2%).  Chart 1 includes more specific data on selected California exports of goods and services, as expressed in 2012 dollars (adjusted for inflation) and based on the Export Nation methodology.

Chart 1 – Southern California Largest Metro Areas Exports (2007-2012)(in millions, adjusted for inflation)

Metropolitan Statistical Area

2003 Exports (millions)

2012 Exports (millions)

Export Share of GDP

Export in Goods 2012

Export in Services 2012

Annualized 2009-2012 Growth in Manufacturing

(Post-Recession)

El Centro, CA Metropolitan Statistical Area

432.7954

586.8708

9.3%

456.5946

130.2762

8.9%

Los Angeles-Long Beach-Santa Ana, CA Metropolitan Statistical Area

62850.51

93871.65

12.0%

56462.39

37409.26

4.0%

Oxnard-Thousand Oaks-Ventura, CA Metropolitan Statistical Area

3997.99

6462.674

15.2%

4822.016

1640.658

3.8%

Riverside-San Bernardino-Ontario, CA Metropolitan Statistical Area

7999.825

13128.07

9.2%

8407.373

4720.697

5.9%

San Diego-Carlsbad-San Marcos, CA Metropolitan Statistical Area

11996.96

21613.47

11.5%

13702.52

7910.954

7.2%

San Francisco-Oakland-Fremont, CA Metropolitan Statistical Area

15417.44

38046.75

12.5%

23306.12

14740.64

-0.7%

San Jose-Sunnyvale-Santa Clara, CA Metropolitan Statistical Area

21384.90

34641.22

23.8%

26418.39

8222.831

10.9%

Source:  Export Nation 2013, Global Cities Initiative, a joint project of Brookings Institute and JP Morgan Chase

Additional Background from the Hearing

Copyright © 2011 State of California