W hen CNBC named Virginia America’s top state for business in July, the news was well-deserved recognition of the commonwealth’s stable of resources.
Our 2.6% unemployment rate in October is an indicator of the competitive commonwealth job market. Our colleges and universities are among the best in the nation, building new degree pipelines through initiatives like the Tech Talent Investment Program. The Port of Virginia is a favorable location for large ocean carriers to dock, and Dulles International Airport offers nonstop flights to 47 overseas destinations.
Compared to other states, Virginia’s business story is not as well-known abroad. We’re pleased to see state leaders step up and raise our international profile.
Earlier this month, Gov. Ralph Northam announced Virginia’s first International Trade Strategic Plan. The document was formulated through a steering committee led by Secretary of Commerce and Trade Brian Ball and Secretary of Agriculture and Forestry Bettina Ring.
Conversations included feedback from the Virginia Department of Agriculture and Consumer Services, the Virginia Economic Development Partnership, the Port of Virginia and other state agencies. The group included companies, trade associations, business leaders from public and private sectors, and voices from varied geographies and industries, with the goal of “ensuring the final recommendations represent a broad cross-section of Virginians,” the governor’s office said.
While the commonwealth draws rave reviews for its domestic reputation, the trade plan spelled out the truth: Virginia “has room to improve its level of international commerce.”
Look at the divide within some key trade indicators. In 2017, Virginia ranked 12th in U.S. population and 13th in gross state product (GSP). But the commonwealth ranked 41st in exports per capita, 44th in exports as a share of GSP and 38th in imports as a share of GSP.
Then, there’s the issue of diversifying Virginia’s economy. The trade plan notes the federal government accounts for 30% of state output, making the commonwealth fifth most-reliant in the nation. Our manufacturing sector, which helps drive overseas commerce, only accounts for 6% of Virginia jobs.
“These two factors combine to lower the ceiling for Virginia’s international trade, limiting the flow of goods through the rapidly expanding Port of Virginia, and ultimately hampering the state economy’s ability to weather domestic recessions,” the report warns.
The International Trade Strategic Plan focuses on three categories to make Virginia more competitive. How can state agencies improve capabilities for businesses to increase their exports? What connections would strengthen international supply chains? How can the state align international trade efforts with the areas of “business attraction, infrastructure, tourism, and other enablers?”
“We live in a competitive global economy, and it is important that we share the Virginia story with businesses and trade partners around the world who are interested in buying our goods and services,” Northam said in a statement. “International trade and marketing missions are critical tools to recruit new investment to the commonwealth and maintain the relationships that will lead to new jobs, more exports by Virginia companies, and shared economic growth.”
Within days of announcing the plan, state officials put those goals in motion with a weeklong trip to Israel and the United Arab Emirates. The discussions yielded more than 50 new jobs, as Israel Aerospace Industries Ltd. (IAI) announced an expansion of its international headquarters in Fairfax County. IAI has a workforce of nearly 15,000 people, with more than 200 on board with its U.S. subsidiary, IAI North America. We hope its engagement with Virginia will expand.
In the case of Israel, trade progress starts with simple developments, like United Airlines providing nonstop service between Dulles and Tel Aviv last year. Whether you’re a business owner or a tourist, in-person experiences require a sound travel connection. And whether business is done online or face to face, we think Virginia has a lot to offer in every corner of the globe.