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U.S. Commerce chief pitches foreign investment, overseas exports

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By Chuck Crumbo
colanews@scbiznews.com
Published April 1, 2014

U.S. Commerce Secretary Penny Pritzker hailed BMW’s plans to invest $1 billion and add the X7 sports activity vehicle to its U.S. plant’s lineup as further proof of a renaissance in American manufacturing.

Pritzker online 3On Friday, Pritzker (pictured, left)  joined top BMW executives and state officials in celebrating the German carmaker’s announcement that it plans to add 800 jobs and boost the Spartanburg County plant’s annual production capacity by 50% to 450,000 vehicles.

“There has never been a better time to invest in America,” said Pritzker, who took over the agency last June. “In fact, the Commerce Department just released data showing that the value of foreign direct investment in the United States ended last year at a record $3.2 trillion.”

The plusses for foreign investment in the United States includes its strong rule of law, intellectual property protections, stable financial markets, low-cost and abundant energy, vibrant supply chains, world-class universities, strong consumer base, and trade agreements that provide access to millions more consumers, Pritzker said.

“And, of course, the ingenuity and dedication of American workers,” Pritzker said. “All of these factors are driving investment to the United States, and creating renaissance in American manufacturing.”

Just last week the Commerce Department released data from the 2012 economic census that shows that payroll-per-employee in the transportation industry – including automakers – have surpassed pre-recession levels of 2007, Pritzker said.

Pritzker also pointed out that 2013 was a fourth consecutive record year of U.S. exports, which topped $2.3 trillion. South Carolina’s share of that total was a record $225 billion.

“This plant is contributing to this growth,” said Pritzker, whose family owns Hyatt Hotels Corp. “In fact, more than half of the cars built here are shipped outside of our borders, making BMW one of America’s top auto exporters.

“I believe that the key to successfully investing in the United States is partnership. And BMW provides an excellent case study for building strong partnerships.”

Pritzker credited free-trade agreements with not only providing businesses access to millions of additional consumers, but also with helping to improve workforce development.

"The community benefits greatly from the training programs BMW has brought over from Germany," she said, highlighting BMW partnerships with Upstate technical colleges and the automaker's support of the Clemson University International Center for Automotive Research.

BMW AG CEO Norbert Reithofer also spotlighted the importance of free-trade agreements at the event.

"This shows exactly what can be achieved when federal, state and local government and industry work together," Reithofer said.

The partnership between BMW and South Carolina also offers an example of the “deep commercial and economic ties between the United States and Germany,” Pritzker said.

She noted both countries are working to remove regulatory hurdles to trade through the proposed Transatlantic Trade and Investment Partnership or TTIP. The agreement is being negotiated by the United States and European Union.

Pritzker said that two-way trade between the U.S. and Germany reached an all-time high of $225 billion last year and said the U.S. is working to boost European trade even more through the negotiation of the TTIP accord.

The proposed agreement promises to boost South Carolina’s exports to Europe by 187% and create a total of 10,000 new jobs.

Germany and the United Kingdom rank as South Carolina’s No. 2 and No. 5 customers, respectively, having bought $5.1 billion worth of exports in 2012, according to the latest figures from the International Trade Administration.

Overall, EU countries purchased $7.4 billion of S.C. goods, about 29% of the state’s total exports, according to recent study supporting the trade pact.

If the agreement is fully implemented, South Carolina could see exports of motor vehicles climb by $27.3 billion, chemicals by $615 million, other machinery by $337 million, and metals and metal products by $327 million, the report said.

The pact is designed to promote economic growth and create jobs on both sides of the Atlantic. Research shows the agreement could boost the EU’s economy by $162.3 billion, the U.S. economy by $121.7 billion and the world’s economy by $135.3 billion.

Work on the pact began in July and a fourth round of talks was launched in March.

Reach Chuck Crumbo at 803-726-7542. Scott Miller contributed to this article. Reach Miller at smiller@scbiznews.com.

 

Editor’s note: A previous version of this story incorrectly listed South Carolina’s total share of U.S. exports. The corrected version appears above.

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