Story by Emily Stifler | photo by Kene Sperry

MONTANA EXPORTS
In 2010, Montana’s merchandise export shipments totaled $1.96 billion in commodities and manufactured goods, according to Arnold Sherman at the Montana World Trade Center.

The state’s export revenue has doubled in the last five years. Montana maintains trade offices
full-time in Taipei, Taiwan and Kumamoto, Japan to promote export of value-added agricultural and
manufactured products, tourism, and higher education opportunities to markets in East Asia. The state’s main markets: Canada, Korea, China, Japan, Mexico and Taiwan.

Of the 800+ Montana companies exporting goods, over 80 percent were small and medium-sized enterprises, with fewer than 500 employees. SMEs generated 61 percent of Montana’s exports in 2008—the second-highest percentage nationally, and well above the national average of 31 percent.

Montana’s largest merchandise export category is chemical manufactures, which accounted for $369 million in 2010. Other top exports are machinery, transportation equipment, mining, primary metal manufactures, high tech material and agricultural products.

At a presentation in Bozeman, Gary Locke, U.S. Secretary of Commerce, said exports support 9,000 Montana jobs. Across the country, he said, exports directly support nine million jobs; jobs involving exports generally pay 15 percent more. “These are exactly the jobs we need more of,” Locke said.

APEC 2011

In May, more than 500 international representatives and 100 Montana businesses convened in Big Sky, as part of the Asia Pacific Economic Cooperation’s Trade and SME Ministerial meetings. This was the second of four APEC meetings held in the U.S. this year.

With 21 member economies (countries) throughout the Asia-Pacific region, APEC works to strengthen and drive economic growth and regional integration, collaborating to create an “open, liberal environment” for trade and investment, according to Michael Camuñez, U.S. Assistant Secretary for Market Access and Compliance, with the International Trade Association.

For the first time in APEC history, Trade and SME ministers held a joint meeting. They discussed top barriers of trade for small businesses, and how to best support small businesses and small business exports.

SMEs, Camuñez said, make up the overwhelming majority of our economies—90 percent of all businesses in the APEC economies and nearly 60 percent of the work force are SMEs. Because of this, “It’s critical that as we develop trade policy for the region, we have a particular focus on the needs of small business. Montana is one of the leading states for small businesses and has a very robust small business sector.”

For 2011, the United States’ APEC
host year, President Obama set
three broad goals:
1. Strengthen economic integration
and expanded trade through
policy.
This ensures open markets,
so companies can easily do business
across the APEC region.
2. Promote green growth. This
requires work at the policy making
level, and at the business level,
through public private partnerships.
“We want to understand
what business needs to grow in the
green sector,” Camuñez said.
3. Advance regulatory cooperation
and convergence.
Each
member economy regulates itself
to protect public health, safety and
welfare. Because of this, “Exporters
have to navigate “complex, sometimes
competing regulatory regimes
in different economies,” Camunez
said. “[In some cases] It’d be much
more efficient and cost effective,
and therefore competitive, to [promote
a common] standard.”
APEC is also developing common
standards and regulation for new
and emerging sectors like clean energy,
nanotechnology and the smart
grid. “The growth of that technology
will lead to millions of jobs,”
Camuñez says.
According to U.S. Senator Baucus
(D-Mont.), who was instrumental
in bringing APEC to Big Sky, Montana
businesses showed “21 of the
world’s top economies that they are
ready to compete.”
Baucus cited success as a result of
the connections made at the APEC
meetings: “General Electric is coming
back to Montana this summer
to find ways to do business with
even more Montana companies. The
Great Falls Development Authority
will [lead]… Montana businesses on
a trade mission to Calgary this summer.
And the Department of Commerce
will … [return] to Montana
this summer for an in-depth conference
with tribal leaders.”

THE NATIONAL EXPORT INITIATIVE

“Trade supports jobs and economic
growth,” Camuñez said. 95
percent of consumers live outside
US borders. So, when companies
export overseas, they expand
their consumer base, which typically
leads to higher growth in
their domestic workforce, and
job creation. “To be competitive
in the 21st century, the United
States has to compete overseas,”
he added.
With a goal to double U.S. exports
by 2015, President Obama’s National
Export Initiative promotes
U.S. exports and drives U.S. competitiveness,
Camuñez said. The
NEI has five key points:
1. Trade advocacy and export
promotion:
Trade missions bring
U.S. companies overseas; promotion
of U.S. exports overseas;
domestic export assistance centers
help educate businesses understand
overseas markets, make
contacts, and do market research.
2. Increase and expand access
to credit, especially for small
business.

3. Remove barriers to trade and
to expand market access overseas.

a. Negotiate and developing
new free trade agreements to
expand U.S. access to foreign
markets. The U.S. has trade
agreements pending with Korea,
Columbia and Panama.
b. The International Trade
Association works to resolve
market access barriers overseas
– i.e. licensing requirements,
customs facilitation, intellectual
property protection.
4. Enforce trade rules and commitments.
5. Promote widespread economic
growth on the global level.

The NEI is a “robust, disciplined,
focused effort to help US
companies compete more effectively
overseas,” Camuñez said.
And it all comes back to SMEs:
“Worldwide, economic growth
and innovation—which brings
new products and technologies
to market—is all driven by small
businesses.”

A GLOBAL MARKET FOR MONTANA

“2010 was record year for Montana
exports to APEC member economies,”
said Carey Hester, Montana’s
commercial officer for the
International Trade Association.
“That bodes well for our future.”
The State of Montana, the U.S.
Department of Commerce, and
the Montana World Trade Center
have been “pretty successful” in
working together with Montana
exporters to promote and help
grow exports from the state of
Montana,” Hester said. “That’s
one reason why you’ve seen our
exports grow.”
Reverse trade missions also promote
export growth, said Linda
Howard of the Montana Department
of Agriculture. In May, six
buyers representing three grocery
store chains and three import businesses
in Taiwan toured Montana
facilities. “We take them around
Montana and make connections
with suppliers that are exportready
or interested in exporting,”
Howard said. “Then it’s up to them
to do the business.”
Craig Allen, U.S. Deputy Assistant
Secretary for Asia, said, “The
Asian markets have a huge demand
for what Montana has to offer…
Montana has some of the highest
quality wheat in the world. Beef,
and other meat products also have a
large market.”
Tourism and education are also exports,
Allen said. “When a Japanese
tourist comes and skis and fishes,
we consider that an export, and
Montana’s potential there is near
infinite… When a foreign student
pays out-of-state tuition, that’s
an export that will pay long-term
dividends.”
Montana’s high tech exporters have
a global market, Allen said. “It’s
not a market of the United States
or NAFTA alone, it should include
Asia. Asia is where the world’s
economic growth is coming from.
China has 22 percent of the world’s
population –approximately 1.4
billion—and their GDP is growing
at 11 percent a year. That’s pretty
attractive for a budding exporter.”

THRIVING ON COMPETITION AND INNOVATION

“The United States continues to be the
world’s leading economy for innovation,”
Camuñez said. “Americans are
incredibly industrious and innovative,
and we are at our best when we have to
compete. And when we compete, we
win. So, I’m very optimistic about the
opportunities.”
Camuñez also acknowledged challenges.
Countries like China and
India offer cheaper products, and have
certain competitive advantages. While
this may mean “there are some sectors
where we’re not as competitive – low
end manufacturing, for example…the
United States is extremely competitive
in producing goods higher up on the
value chain… We’re invested in creating
high value manufacturing jobs, …
that pay more and provide higher value
and … are better for American workers.”
Strategic investments U.S. human
capital, workforce, infrastructure and
industry regulation are key, he added.
In some cases, trade causes disruption for
workers, Camuñez added. But government-
run “trade adjustment assistance
programs” provide training and support
for workers to acquire new skills and tools.
“There is not a country in the world that
has a more robust network of entrepreneurs
[than the United States],” Camuñez
said. “It’s one of our core competitive
advantages. It’s something that we have to
continue to nurture and invest in.”
“There’s plenty of money to be made in
these markets,” Allen said. And now
is a good time for it. “The dollar is relatively
low. That makes American products
extremely competitive in markets around
the world.”

mt.gov
trade.gov
exportmontana.com
mwtc.org