The U.S. Commercial Service: Serving SMEs and U.S. businesses around the world

The Huffington Post
Arun M. Kumar
28-Jun-2016

The U.S. and Foreign Commercial Service, a part of the International Trade Administration’s Global Markets unit and now 35 years old under this name, traces its heritage to the earliest days of American independence. President George Washington appointed Commercial Agents in various locations, from Portugal to India, to represent the young nation’s commercial interests. Today, the work of those intrepid pioneers has expanded to global coverage provided by over 1600 professionals located in 78 countries, all the 50 states and at the U.S. Department of Commerce headquarters in Washington, DC. I was honored to lead this service for three years, following my selection by Secretary Penny Pritzker and nomination by President Barack Obama in October 2013 followed by confirmation by the Senate in March 2014.

The Commercial Service is motivated by a very important purpose; that of creating jobs in the U.S. With 95% of the world’s consumers living outside the U.S., it has been long recognized that America needs to export in order to boost economic activity and job creation. The Commercial Service is particularly focused on helping small and medium scale enterprises (SMEs), which cannot normally afford the investments and risks. Further, many SMEs face and are often deterred by aggressive foreign competitors.

In response to these challenges, the Commercial Service plays a critical role in providing SMEs an affordable way to enter new markets, overcome barriers, and capitalize on new opportunities. We have been elevating, promoting, and protecting the “Made in the USA” brand, while producing solid results for exporters and economic development organizations. From 2010 to 2016, the Commercial Service’s assistance to U.S. businesses played a significant role in achieving over $300 billion in U.S. exports and over $23 billion in inward foreign direct investment supporting an estimated 1.7 million American jobs.

As the head of the Commercial Service, I have had the privilege of visiting dozens of countries, meeting with heads of governments, economic ministers, and hundreds of business leaders. These visits confirmed four important constants. First, foreign governments seek to attract American investment in their countries. Second, their countries’ citizens desire access to U.S. goods and services. Third, the U.S. private sector perspective carries tremendous heft worldwide because it is backed by best-in-class products and services and deep reserves of financial capital. It is also a source of best practices and capacity building. Finally, there is global admiration of America’s leadership in entrepreneurship and innovation, reflecting the desire among people worldwide to build their own economic destinies and exercise their creativity.

Our teams have been helping more American companies, at home and abroad, develop the capability and interest to navigate the global landscape. The transformational impact of our teams is evident both at home and abroad.

In Asia, our Commercial Service teams contributed to the economic component of the Rebalance to Asia. They launched and institutionalized the U.S.-India Strategic and Commercial Dialogue (S&CD) in September 2015 to accelerate growth in the commercial aspect of this relationship with India, the world’s fastest growing emerging market with 1.3 billion people. Our teams in Asia also created new Commercial Dialogues with South Korea and Japan, launched important infrastructure partnerships with Japan and Singapore, formed valuable public-private partnerships in Indonesia’s aviation and power sectors, and developed a commercial work plan with the democratically elected government in Myanmar.

Our teams in China helped to successfully re-imagine the U.S.-China Joint Commission on Commerce and Trade, transforming the forum into a venue for valuable private sector consultation resulting in specific commercial policy outcomes that benefit U.S. sectors and companies in areas such as medical devices, pharmaceuticals, and agriculture biotechnology. They also organized trade missions to China focused on smart cities, green infrastructure, and health care business development.

High profile commercial diplomacy efforts were led by our Europe teams in Ukraine as well as the Baltic states, Poland, Romania, and Scandinavia, highlighted by Secretary Pritzker’s consistent engagement at the highest levels with Ukraine on an economic work plan and the convening of the U.S.-Ukraine Business Forum in 2015. The teams also focused U.S companies on opportunities in Kazakhstan and Georgia.

In Africa, our teams significantly elevated our growing commercial partnership on the continent through the widely recognized U.S.-Africa Business Forum held with Bloomberg Philanthropies; Trade Winds— Africa Business Development Conference and trade mission, which was the largest U.S. government-led trade mission to the region; and the U.S.-Africa Institutional Investor Roadshow. We view sub-Saharan Africa as a region of immense potential for U.S. businesses and expanded our presence in the region by opening new offices in Mozambique, Angola, Tanzania, and Ethiopia and at the African Development Bank in Cote d’Ivoire.

Our Western Hemisphere team led the High Level Economic Dialogue (HLED) with Mexico and related initiatives such as the U.S.-Mexico Energy Business Council. The team also made progress on regulatory coherence, standards, and trade facilitation issues with Brazil during a turbulent time, launched a new Commercial Dialogue with Argentina to take advantage of the new reform-minded government.

At home, our teams based in our U.S. Export Assistance Centers across the country have moved successfully on a path to reorient their service delivery model to focus on sectoral expertise and instituting a sharper focus on adding value to, and making better use of, the local ecosystems of economic development organizations, state and city leaders, and the District Export Councils. The Trade Winds and Discover Global Markets business conferences have evolved into premier trade and investment events for U.S. businesses. In support of the White House’s Made in Rural America export and investment initiative, our U.S.-based teams launched a Rural Export Innovation Team (led out of Fargo, ND) with more than 100 trade specialists nationwide, delivering 25 projects to connect rural American businesses to overseas markets and helping the export success of more than 150 rural companies. They were also instrumental in recruiting over 450 U.S. companies to Hannover Messe 2016.

Foreign direct investment into the U.S. is a major source of job creation for U.S. businesses and our SelectUSA program has built a well-established brand promoting the United States as an investment destination. Since its inception, Select USA has assisted thousands of U.S. Economic Development Organizations (EDOs) and foreign firms, facilitating over $23 billion in investment and supporting tens of thousands of U.S. jobs.Its 2015 and 2016 Investment Summits featured over 2,500 participants from more than 70 international markets and were signature events for the entire U.S. Government. Planning for the 2017 Summit, held on June 18-20, 2017 in Washington DC, is well under way.

Our Advocacy Center team completed 2016 by achieving a record 100 wins or public contracts valued at $50.9 billion, with $36.2 billion in U.S. export content, that support about 178,000 American jobs. The team has further deepened ties with the multilateral development banks and opened a post at the African Development Bank. The Advocacy Center incubates the Department of Commerce’s Infrastructure Initiative, which will help more U.S. companies gain access to and compete for global infrastructure projects. Pilot programs to advance U.S. company participation in infrastructure are under way in India, the Philippines, Mexico and sub-Saharan Africa.

Looking ahead to future growth opportunities for U.S. exporters, we recognize that burgeoning digital channels and e-commerce platforms offer new avenues for small U.S. businesses to reach customers globally. Using the web allows us the opportunity to broaden and deepen the U.S. exporter base. We have set a goal of expanding tenfold the number of clients we serve from 25,000 to 250,000 through programs including partnerships with the private sector, a Digital Attaché program to address trade barriers and trade policy issues, and an eCommerce Innovation Lab based in Silicon Valley. Strengthening the focus on helping SMEs use digital marketplaces to expand their exports as well as in expanding the digital attaché program will be critical in the years ahead.

As is clear from the foregoing snapshot of its activities, the U.S. Commercial Service is intensely engaged around the world and in all our states as a vital player in the business landscape, especially for small and medium enterprises that are the largest job creators in our economy.

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