WorldCity, Local Media Coverage on Global Economic Impact Study (Miami Herald, Sun-Sentinel, etc.) | Connecting Local Business Leaders To The Global Economy

Local Media Coverage on Global Economic Impact Study (Miami Herald, Sun-Sentinel, etc.)

January 18th, 2008

Multinationals drawn to S. Florida

By Doreen Hemlock
South Florida Sun-Sentinel
January 17, 2008

South Florida often is perceived as a haven for sun and fun, but the area is home to nearly 1,200 offices of multinational companies that garner more than $200 billion in revenue an amount almost as big as the economy of Venezuela or Argentina.

Those are among the findings of a study unveiled Wednesday by Coral Gables-based media company WorldCity and The Beacon Council, Miami-Dade County’s economic development partnership.

The study is the first to quantify the revenue managed by multinationals such as Office Depot, DHL and General Motors in South Florida offices. They handle areas that vary from the entire world to all of the Americas or sometimes, only a local region.

Economic development leaders hope the new data will help lure more businesses to South Florida, especially companies from Europe and Asia looking to manage Latin American and Caribbean operations from a convenient hub.

“This gives us the ammunition when we go to recruit other companies,” said Frank Nero, president of The Beacon Council, at an unveiling of the study for the media Wednesday.

South Florida’s strong and diverse global links from car sales in South America to fuel sales in Asia will help the area weather a potential recession better than other U.S. regions that are more closely tied to one industry or only to their local market, leaders said.

“I think the numbers of companies and size of their revenues will amaze many people and show the substance of what’s driving the South Florida economy,” added JT Tarlton, president of The Broward Alliance, the economic development partnership for Broward County.

For example, the study shows that General Motors operates a little-known office in Miramar in southwest Broward that oversees fast-growing sales in Latin America, the Middle East and Africa that reached $14.6 billion in 2006.

In all, the South Florida offices of 1,183 companies from 56 countries totals $202.8 billion more than double the size of the economy of Miami-Dade County and more than the economies of Chile or Colombia, the research found.

That count is conservative, too, because researchers tallied only those revenues they could confirm and did not extrapolate or apply economic models, said Ian McCluskey, publisher of WorldCity Business magazine.

The research looked only at companies that have an office in South Florida and in another country. It did not count, for example, companies that have sales in Latin America but no office there, or operate stores in South Florida but have no office here.

The true revenues managed may be $40 billion to $50 billion more, because many smaller multinationals with South Florida offices did not provide data, McCluskey said.

The study identified 41 multinational companies that manage more than $1 billion in revenues from their South Florida offices. Top on the list is Delray Beach-based office supply giant Office Depot, which oversees global sales of about $15 billion. GM’s Miramar operation is second on the list, with $14.6 billion in revenues for 2006.

Of the 41 companies, 27 had offices in Miami-Dade, nine in Broward and five in Palm Beach County, the research found. The study is to be formally presented tonight in Coral Gables at an event to be attended by corporate executives.

____

Posted on Thu, Jan. 17, 2008

Study shows ‘power’ of S. Fla. multinationals
www.miamiherald.com
By JIM WYSS

South Florida is home to almost 1,200 multinational corporations from 56 countries. And if their $203-billion combined revenue was measured as gross domestic product, they would rank as the world’s 46th largest economy—just behind Portugal and just ahead of Chile.
Yet South Florida’s multinational sector is largely overshadowed by the glitzy tourism industry and the roller-coaster real estate market.

A new study by WorldCity Business Magazine with the backing of the Beacon Council, Miami-Dade’s economic development agency, hopes to shed some light on the ‘’submerged’’ multinational economy.

The study, which will be officially unveiled Thursday, found that at least 1,183 multinationals call South Florida home. And the top-20 multinational employers account for 180,000 local jobs.

‘’Whether it’s a global headquarters like Burger King or a regional headquarters like HP Latin America, this study reveals the power and global reach of South Florida’s multinational business community,’’ WorldCity Publisher Ian McCluskey said.

Among the corporate ranks are 41 firms—all with at least a regional presence here—that recorded a billion dollars or more in annual revenue. Of those, 27 are in Miami-Dade, nine are in Broward and five are in Palm Beach County.
Topping the list are Office Depot, General Motors, Carnival Corp. and World Fuel Services—all with revenue in excess of $10 billion. All have their global headquarters here save GM, which runs its Latin America, Africa and Middle East divisions from offices in Miramar.

MYTHS BUSTED

The report, titled South Florida Global Economic Impact Study, is one of the most comprehensive of its kind and might help dispel some South Florida myths, said Beacon Council President and Chief Executive Frank Nero.
Nero said that when he goes on trips around the globe to encourage companies to locate here one of the first questions is: ``Do you do business there?’’
‘’Miami is not just a fun-and-sun capital,’’ he said, but rather ``truly what we want it to be—a global business center.’’

While South Florida bills itself as the gateway to Latin America, its multinational community has a decidedly European flavor. After U.S. companies—659 of which have offices here—come the United Kingdom and Spain with 59 each and France with 46.

When Airzone, a Spanish air-conditioning giant that has extensive operations throughout Europe and the Middle East, wanted to start a North American division in 2006, Miami was a natural choice. Not only was Florida amid a building boom that promised lucrative contracts, ‘’but the language and culture are similar to ours, which makes it easier,’’ said Airzone USA General Director Xavier Arias. ``Also, there are daily flights from [Spain] to Miami, which makes it very convenient.’’ Airzone has three employees at its 1,300-square foot office in Miami—but hopes to expand in the future.

To make the multinationals list, companies had to be operating in at least two nations and have a corporate presence here—not merely a retail outlet. Compiling the data was not easy, said McCluskey. There is no central database where multinationals must register and most are under no obligation to disclose sales figures.

CORPORATE SECRETS

Of the 1,183 multinationals researchers identified in South Florida, only 728 provided revenue data. If that missing revenue were added to the total, the sector would likely be worth $250 billion to $300 billion, he said.

South Florida’s strategic location at the center of Latin America, North America and Europe have made it an attractive choice for multinationals looking for a foothold in the region, but competition is fierce, Nero said.

New York, Houston and Atlanta have marketing budgets of $82 million, $40 million and $23 million, respectively, Nero said. Miami-Dade County, by comparison, has a budget of just $1 million a year to attract global headquarters.

That discrepancy shows that even the state’s lawmakers are unaware of the power, and potential, of wooing multinationals, he said.

‘’We need more understanding by our elected officials of what’s driving the economy,’’ he said. ``I don’t think the state understands you cannot market worldwide. . . with the resources we have.’’

2008 Miami Herald Media Company. All Rights Reserved.
http://www.miamiherald.com
____

Posted on Mon, Feb. 11, 2008

South Florida attracting more multinational firms

BY MICHAEL DIAZ JR.

As one of the world’s three most diverse areas (Dubai and Toronto top the list), South Florida offers multinational corporations a vibrant and attractive locale for either a regional or global base for operations.

Hailing from more than 50 countries, some 1,400 South Florida multinational companies—a number expected to grow exponentially over the next decade—produce more than $200 billion in annual revenue, according to a recent Beacon Council and WorldCity study. Yet these staggering numbers could easily double over the next five years as free trade agreements proliferate and South Florida’s ‘’secret’’ spreads: We are much more than just the ‘’Gateway to Latin America’’—we’re a global launching pad.

BANKING CENTER, TOO

Certainly South Florida’s strategic location between Latin America, Europe and North America helps lure multinational corporations to the area. But that’s just part of the attraction. In addition to the obvious advantages presented by a multiethnic and multilingual community and workforce, South Florida boasts the largest concentration of banks south of New York City, with more than $60 billion in deposits—much of it coming from Latin America, second only to Europe, the Middle-East and Africa as a source of multinational investment.
What does this all mean for South Florida’s economy and future? Certainly in the short term, European companies will take advantage of the weakened U.S. dollar to increase their South Florida investments. But our solid historical positioning as the ‘’Gateway to Latin America’’ bodes an even brighter future.

GOOD GROWTH

Recent statistics from Washington, D.C.-based Inter-American Dialogue show that Latin America as a whole has sustained three consecutive years of economic growth, with inflation the lowest since the 1960s. From 2002 to 2006, some 15 million Latin American households climbed above the poverty line. China’s growing demand for Latin America’s raw materials and energy products will continue to fuel regional economic growth. In fact, in the first three quarters of 2007 Latin America received—for the first time in history—more than $100 billion in direct foreign investment.

This economic boom—and anticipated free trade agreements with Colombia, Panama and South Korea (which claims twice as many South Florida-based multinational corporations as Costa Rica, El Salvador, Guatemala and Nicaragua combined)—promises to fuel demand for goods and services here as Latin Americans’ purchasing power continues to grow.

Multinational corporations looking to cash in on the region’s growth cannot be far behind.
International trade’s direct economic benefits—increased sales and profits for U.S. businesses—strengthen our local economy. In addition, regional economic growth spurred by international trade strengthens foreign relationships. The resulting interdependence helps alleviate pressing social problems and minimizes the potential for conflict on sensitive issues such as illegal immigration, unemployment and environmental concerns.

FREE TRADE

While Congressional debate rages on the pros and cons of free trade agreements, both sides recognize a crucial fact of global economic life: The U.S. continues to fight a pitched battle to secure competitive advantages for its products and services in an increasingly complex global marketplace. The agreements play a crucial role in securing such advantages. Exports to free trade agreement partners have grown twice as fast as those to other countries.
Last year $72 billion in trade passed through Miami alone—including 60 percent of all U.S. trade with Central America. Further, the next decade should see a marked increase in Chinese and other Asian businesses in South Florida as they use South Florida ports and resources as a platform for their Latin American investments.

Continued economic growth stimulated by free trade agreements and increasing direct foreign investment in Latin America, coupled with South Florida’s diversity and trade facilities, make the prospect of many more multinational corporations moving to South Florida a sure bet.

Michael Diaz Jr. is a founding partner of Diaz, Reus, Rolff & Targ in Miami and the managing partner of the Litigation and Alternative Dispute Resolution Group of DRRT.
__

2008 Miami Herald Media Company. All Rights Reserved.
http://www.miamiherald.com