Game On: Trump Administration Moves Forward with SelectUSAMay 2, 2017
(Episode 17 of “The Project: Inside Corporate Location Decisions”)
While a lot is changing in Washington this year, new Commerce Secretary Wilbur Ross recently confirmed one important initiative that is full steam ahead. SelectUSA, a program focused on helping the United States attract more foreign direct investment, is continuing and will be holding its fourth investment summit in the Washington area on June 18-20.
“The Project” travels to Washington for an interview with Fred Volcansek, SelectUSA’s New Executive Director. Anne McKinney, the organization’s Director of Investment Services, joins Fred for the interview.
We also hear from the leader of one economic development group that has successfully worked with SelectUSA in the past. Jan Rogers, CEO for the Regional Economic Development Corporation for Eastern Idaho (or REDI for short) talks about her collaboration with the organization and success attracting two Japanese companies to Idaho as a result.
Andy Levine (DCI): Back in 2007 President George W. Bush and his Department of Commerce launched a modest initiative called Invest in America. The aim was the help the United States attract a greater share of foreign direct investment.
Patience Fairbrother (DCI): Under President Barack Obama the program saw a major increase in staff and funding, and took on the new name of SelectUSA. Today it has a staff of 39 professionals, and over \$23 billion in foreign direct investment can be traced back to the program. So the question on the minds of economic developers all across the country was simple. What will happen to this program under President Donald Trump?
Andy: On Monday, April 10 the recently-confirmed Secretary of Commerce, Wilbur Ross, took the stage at the International Economic Development Council’s Federal Forum, I was there, and he answered that question. SelectUSA is here to stay, and he brought with him to the event Fred Volcansek, the newly-appointed Executive Director of SelectUSA.
Patience: So welcome to Episode 17 of “The Project: Inside Corporate Location Decisions.” I’m Patience Fairbrother of Development Councilors International.
Andy: And I’m Andy Levine, also with DCI, and Patience’s cohost of “The Project.” So on Monday morning I caught a 5:30 a.m. Amtrak train from New York to Washington.
Patience: Wow, Andy. That’s early even for you.
Andy: It was truly the Dawn Patrol, but I had the chance to sit down with Fred Volcansek, who had just been appointed at SelectUSA’s Executive Director. Fred has an interesting career in both the public and private sector. He also served a term as the mayor of Clifton, Texas. Joining Fred in this interview was Anne McKinney, Director of SelectUSA’s Investment Services Division. So here’s our conversation with Fred and Anne.
So we’re delighted to welcome both Fred Volcansek and Anne McKinney, both of SelectUSA, to “The Project.” Thank you both for agreeing to sit down for this interview.
Fred Volcansek (SelectUSA): We’re delighted to be here.
Anne McKinney (SelectUSA): Thank you.
Andy: Great to have you both. So I want to go back to the start and go back I think about a decade, and look to get a very quick history of both Invest in America and now what has turned into SelectUSA. I realize both of you have not been with the organization for a decade. Fred, you’ve been with the organization now for-
Fred: Two and a half weeks.
Andy: Okay, two and a half weeks, but for our listeners just to get a little bit of an overview of SelectUSA and sort of a bit of the history would be very helpful.
Fred: Well, I appreciate you asking that question and brining up Investment in America, because that was an initiative of the Bush 43 Administration, and that was the nation’s first ever federal program to attract and retain foreign direct investment in the United States.
Andy: And I’m not sure people associate that with the Bush Administration. So it’s a good point.
Fred: Well, it is a point because that’s where they built SelectUSA upon. It wasn’t until 2011 that the previous Administration decided to go ahead and take that a step further, and issued the Executive Order, and it took until 2014 when they put money behind it, and it has just been a super success ever since.
Andy: I want to switch gears quickly to talking about today and sort of the size of the organization, how it’s structed. How many people are employed within SelectUSA right now? And I realize the numbers might be going up and down a little bit as things hit us here.
Anne: Sure. We have a team of about 25 here at Commerce headquarters. SelectUSA is part of the Commerce Department. We also have 14 fulltime investment specialists overseas, but we’ve really leveraged the entire network of the International Trade Administration’s Commercial Service with officers and staff at U.S. Embassies and Consulates in overseas markets as well as across the United States.
Andy: And that is really the formula, and we’ll talk about that a little more. That formula has worked pretty well from what I’ve seen in terms of other summits that I have attended, is you rely heavily on the Ambassadors and their teams to help identify opportunities. Am I reading that correctly?
Fred: Well, I’d like to say it’s a government-wide support. So you’re not just talking about Commerce and you’re not just talking about State. You’re talking about almost 24 different agencies that are involved in the process. There’s the Investment Working Group that is there not just to help facilitate and put investors and companies together and states and EDO’s together, but also to help facilitate the process in dealing with, you know, our tax laws and the various other regulatory issues that new companies investing in America face.
Andy: So in the very simplest terms, like you’re explaining this to maybe a 12-year old, Fred, how would you describe the mission of SelectUSA?
Fred: SelectUSA is an organization that is designed to help foreign investors to come to the United States and invest within the United States building what we hope to be green field investments, which is, for the 12-year old, that’s building something from new up, not necessarily mergers and acquisitions.
Andy: It’s something that brings new jobs here.
Fred: Absolutely. This is all about jobs. President Trump made it clear during his campaign that jobs, jobs, jobs were the key to what he was seeking to create and bring back to America. And there is no question that SelectUSA is the perfect vehicle for doing that.
Andy: Okay. You mentioned the Trump Administration. So when the new Administration came in there was concern that SelectUSA might not survive, and there has been also concern about other economic development programs as well, but let’s focus on SelectUSA.
Recently Secretary Ross as well as President Trump have sent a very clear message that, you know, full steam ahead is sort of what we’ve heard. Can you tell us a little bit about that decision to support the organization, to keep the mission of SelectUSA moving forward?
Fred: Well, Andy, you and I talked earlier about the fact that I was the first political appointee to the International Trade Administration. I think that sends a significant message that the SelectUSA program was extremely important to the Administration’s goals, and that we see that we need to be on it right away. The Summit comes up in a couple of months.
Andy: That’s right.
Fred: And for something as big as this event, it takes a tremendous amount of effort to put on and to handle successfully. So I was put in place rather soon, considering all the other appointees that need to be placed in positions.
Andy: You brought up the Summit. So June 18-20. Now, a lot of economic developers, who are a lot of the people who listen to this podcast, they have attended SelectUSA in the past, but for those who haven’t that are maybe thinking about attending for the first time, can you paint a picture of what the event is like and what someone experiencing SelectUSA for the first time, the Investment Summit, what it would be like and what happens there?
Anne: Sure, well the SelectUSA Investment Summit is really the premiere event focused on foreign direct investment in the U.S. Last year we had over 2,500 participants, including 1,000 representatives of foreign companies interested in entering or expanding their operations in the U.S., more than 600 representatives of economic development organizations, as well as representatives of the U.S. Government, service providers, and business associations.
Often it reflects some of the main source countries of foreign direct investment into the U.S. So that includes the United Kingdom, Japan, Germany, we’ve had large delegations from China each year, Taiwan. Those are just many of the markets. India, we expect to have a large delegation this year.
Fred: Even from the Middle East. Qatar has expressed an interest in coming and participating in this year’s summit. Korea has expressed interest to the Secretary and its interest. So you’ve got that broad range of companies.
You know, you talk about the summit and how important it really is. I don’t know if you’re aware, Andy, that over \$20 billion in development has come as a result of efforts by SelectUSA.
Andy: That’s a big number.
Fred: It’s a big number. It tells you that there really is something and there’s more to come.
Andy: Is it more challenging this year? It’s a new Administration. In the past you’ve relied, I believe, sort of heavily on the Ambassadors around the world to help drive companies here. Of course a lot of Ambassadors haven’t been confirmed at this point. Is it more challenging because it’s a new time, a new Administration, and the infrastructure that you’ve had in the past maybe isn’t quite as strong as it had been?
Anne: Actually the infrastructure is still in place. We’re still working with the professional staff at U.S. Embassies and Consulates around the world to recruit companies. I think precisely because it is a new Administration there’s a lot of interest in learning more about the Administration policies. So it’s an excellent time at the start of a new Administration to learn about how the U.S. will continue to attract investment. So we’re seeing strong interest from around the world.
Andy: So the energy is as strong as ever, is what I’m hearing you say.
Fred: Well, you know, Andy, are you familiar with the Carnegie Report?
Andy: Yes. I actually read it before coming down here today.
Fred: Well, good. So you saw that for the fifth straight year the United States is the number one destination for foreign direct investment.
Andy: And really no drop-off in rating at all.
Andy: When we talked about the Summit a little while ago, you talked about really two sets of people that come together for this. The first are the international companies exploring investment. The second is your economic development partners around the United States. I just want to sort of go into a little bit how you work with each of those groups. Let’s start with the international investors, companies that are looking to come here. How do you tend to work with them and how do you attract them to the conference?
Anne: Well, in addition to the Summit we work with international companies throughout the year to provide them with the information that they need at every stage of the investment decision making cycle. So we provide them with actionable business information that can assist them as they’re exploring the U.S. market or evaluating a specific project opportunity that they’re developing. We also help connect them with economic development organizations and help them navigate the federal system.
We also work with economic development organizations at the state, local, and regional level throughout the year to provide them with information to help them strengthen their FDI strategies, to help them connect with international investors. We organize other events such as road shows and single location promotions throughout the year that provide a platform for EDO’s to market their locations internationally, and we also provide investment project advocacy for economic development organizations.
As Fred mentioned, it’s a competitive global environment. So we’re trying to help our EDO partners remain competitive in attracting investment to their locations.
Andy: Going back to your economic development partners again, I’m curious how many, you mentioned in the last summit there were like 600 partners and there’s a whole big trade show that goes on with people having booths and that sort of thing. Do you think you’ll be at similar levels to what you’ve had in the past?
Somewhat up, somewhat down in terms of participants? Or is it too early to tell? What’s your sense of things?
Anne: Well, right now the registration is on par with where we were at last year. So we’re expecting similar attendance levels. Already 45 state EDO’s have registered for the exhibition space in the pavilion. So we’re expecting to have a strong turnout again this year from our economic development organization partners.
Andy: And just go the other side of the fence in terms of companies, once again. It’s two months to go, but are you trending at similar levels to where you’ve been in the past?
Anne: Yes, we are. We’re at about 1,000 total registrants to date, now at the end of April.
Andy: Okay, economic development and investment partners.
Anne: Yes, and we have investors from 32 markets. So those numbers are continuing to increase.
Fred: I think the synergism that exists between this organization and the people that you meet with, the EDO’s and the businesses that invest in America is as good as you can expect, and it’s a partnership. I think that’s what will help transcend change in styles of administration or whatever, that you’re going to see that because this organization does stand out and is able to go ahead and work with and recognies the value of its partners.
Anne: Also if I may add, this is the fourth SelectUSA Investment Summit, and as Fred mentioned, the companies that have attended the past summits have announced investments of more than \$20 billion. So we have serious companies that are attending the summit and meeting with economic development organizations.
So we conducted a survey last year and many economic development organizations have reported that this event is really high value in terms of the leads and opportunities that are generated.
Fred: And I don’t think there’s a better promoter than Secretary Ross. I know that when he meets with foreign countries coming in, ministers of finance and so forth, when they’ve come to visit with him he brings up the SelectUSA Summit. I think we’re going to see some very interesting involvement from other countries to come here, but there’s a real dedication by this Administration.
Andy: Now, in past summits you’ve had a number of Cabinet-level positions speak at the summits. Is Secretary Ross a lock for speaking at this year’s coming up summit in June?
Fred: He’s the host along with the President of the United States.
Andy: Okay, and that was the second part of the question. President Obama has spoken at previous summits. I assume you probably won’t know the President itinerary until a few days before, but we’re certainly hopeful that he also addressees the group, and I guess any comments there from either of you in terms of the likelihood of that occurring?
Fred: As a matter of fact, this afternoon I will be in discussions with the White House on this matter.
Andy: Okay. Well, we certainly hope President Trump is able to attend and address the group, but it sounds promising. I wish you luck at the event later today. Going a little more broadly, so Fred, you mentioned you’ve been in this position for about two and a half weeks now. But I know you are not completely new to SelectUSA in terms of having been involved in the Commerce Department and having observed it from perhaps afar. What’s your vision for it?
Fred: Well, the answer is that we think that there is tremendous opportunity to expand and to make it a stronger, more viable entity. We’re working on the relationships with the other agencies in the government, and bringing things together. So we’ve got the time over the next four years, or maybe eight years-
Andy: Could be.
Fred: Could be. But we have the time to go ahead and pursue development and enriching this organization. I am so proud to be a part of this organization and so proud of the people I am associated with here. There is an excitement, an energy that you would see nowhere else in a government agency. There’s an entrepreneurial spirit. We’re going to keep developing that.
Andy: Do you see part of your mission, then, breaking down barriers that exist that makes it harder for companies to invest here? I mean is that a big part of improving the investment climate, you think?
Fred: Oh, I think it absolutely is. I think that President Trump has made it clear, you know, the breaking down of regulatory issues and things like that, the difficulties of doing business in the country, from difficult regulatory issues. So the answer is, with this working group that we have, we’re going to be very proactive.
Andy: So at this point in our session a frantic aide rushes into the office and says, “Fred, you’re needed up in Secretary Ross’s office.”
Patience: Sounds kind of like an episode right out of “Madam Secretary.”
Andy: Yes, my wife and I watch that program every week.
Patience: I love that show.
Andy: So Fred apologized and he ran off to this meeting with the Secretary, and we had a few final questions for Anne McKinney.
Tell us about the working group and just who participates in that and who’s sitting around the table in those sessions?
Anne: Yeah, the Interagency Investment Working Group was created in 2011 along with SelectUSA, and it’s really part of the whole-of-government approach to promoting and facilitating foreign direct investment in the United States. So it includes other U.S. Government agencies that have a role to play in terms of improving the business climate as well as issues related to investment.
Andy: And who would sit in that group?
Anne: Twenty four other U.S. Government agencies are part of the Interagency Investment Working Group. It’s chaired by the Executive Director of SelectUSA and coordinated with the National Economic Council at the White House. So participants include the Department of State, Treasury, Homeland Security, in essence a wide range of U.S. Government agencies at the federal level.
Andy: Talk about your relationship with IEDC, the International Economic Development Council, and how SelectUSA and IEDC work together.
Anne: Well, IEDC is represented on the Secretary’s Investment Advisory Council, but we work with IEDC, really their members are our main set of clients and partners in terms of economic development organizations. So we work very closely together in terms of supporting economic development organizations as they work to attract investment to their communities.
Andy: So to conclude this episode we decided to give the final word to an economic developer who has successfully with SelectUSA. Jan Rogers is the CEO of the Regional Economic Development Corporation for Eastern Idaho, or REDI, for short. We talked briefly with Jan about her experience working with SelectUSA.
So Jan Rogers, welcome to “The Project,” and thank you so much for joining us today. Now, in 60 seconds or less can you tell us about your experience attending the SelectUSA Investment Summit in the past?
Jan Rogers (Regional Economic Development Corporation for Eastern Idaho): Yes. This will be our third visit for the summit. The one thing that makes this summit and this conference special over all others, particularly for economic development, is that the companies that attend this summit are 100% vetted with the expectation that they want to invest in the U.S. Our job as states and communities within those states is to get them to invest with us.
Andy: Over your career you have attended a lot of trade shows, a lot of conferences. How would you rate the quality of SelectUSA versus other conferences or trade shows that you’ve attended?
Jan: Well, as I said, this is the only trade show or conference I’ve attended where all of the companies there are there for one reason and one reason only, and this is because they are interested in investing in the U.S. Our job as a state is to get them to invest with us. That’s what makes this conference different than all other conferences that I’ve ever attended.
Andy: Okay, so just a couple of weeks ago, I think it was April 7, you had an announcement, a Japanese company. I wonder if you can sort of take us through the trail of that sale. I may be pronouncing this wrong, but it’s Sakae Casting.
Jan: Sakae Casting.
Andy: Thank you. Can you walk us through that and just tell us a little bit about how that opportunity came about and the role that the SelectUSA Summit played in that?
Jan: Yes. We actually got a visit from several Japanese businessmen just actually coming in to take a look at the U.S. One of their stops was in Idaho Falls. It was a sister city program connection that brought them here. They indicated that they were looking to invest in the U.S., and I suggested since this was their first investment that they might want to consider attending the SelectUSA Conference, which was coming up that June.
So they thought that was a great idea and did attend last year. We met back up with them again at that conference and started actually talking about business opportunities here in Idaho, and specifically here in Idaho Falls. So over the last several months they’ve made several visits, and you’re right, just here early April we had the grand opening of their office. They’ve set up business here. In fact, two companies have.
They are manufacturers in Tokyo and they’re looking to, at some point, invest in manufacturing here in the U.S. So that was a pretty quick turnaround for us. We’re very excited.
The great thing about this particular company and venture is that it is opening the door to other companies that are interested in Japan in looking at the U.S. for investment. So we’re going to have a reverse trade mission, our FDI mission to Japan, so that we can visit their facilities as well as meet with other companies that are interested in moving to the U.S.
Andy: So final question, Jan. If you were advising an economic development group that was attending the SelectUSA Summit for the first time this year, how would you tell them to prepare? What would you tell them to do to get ready for that conference?
Jan: This conference is nonstop from the moment you leave your hotel room until you finally get back to the room to go to bed. You have opportunities to set up meetings with companies specifically interested in your area, you have opportunities to meet with companies through the trade show venue, you certainly have opportunities as well to attend many sessions that help bring both the company and the community together.
This event is completely designed for economic development, EDO’s and communities that want to attract foreign direct investment to their communities. So be prepared for these companies to have enough interest in your community, that while they’re in the U.S. they may make a trip out to see. These deals can work that fast.
Andy: Excellent. So Jan Rogers, thank you so much for joining “The Project” today. We really appreciate your time.
Jan: My pleasure.
Andy: The SelectUSA Investment Summit takes place from June 18-20 at the Gaylord National Resort & Conference Center right outside of Washington D.C.
Patience: We’ll be there interviewing international companies for future episodes of “The Project.”
Andy: And we look forward to hearing from Secretary Wilbur Ross and hopefully President Donald Trump as well. So that is a wrap on Episode 17 of “The Project: Inside Corporate Location Decisions.”
Patience: A sincere thank you to Fred Vulcansek and Anne McKinney of SelectUSA for taking the time to sit down with us. Well, to sit down with Andy. We also want to thank Chris Higginbotham, Deputy Director of Outreach, who arranged the interview in Washington.
Andy: “The Project” is sponsored by DCI. We are the leader in marketing places and have served over 450 different cities, states, regions, and countries. You can learn more about us at aboutdci.com.
Patience: We hope to see you at SelectUSA next month. You might want to come up to us and say, “Of all the podcasts I listen to about corporate location decisions, ‘The Project’ is by far my favorite.”
Andy: We hope a bunch of people come up to us there. We do hope you’ll keep listening to the podcast. There are many more projects to come.