Florida and the Global Economy
What role do sub-national players occupy on the global economic stage?
February 9, 2001
We have all heard about California — that, if it were a separate country, its economy would rank as the world’s fifth largest. Similarly, two other U.S. states — New York and Texas — also boast having economies of global importance.
What you may find surprising is that there is yet another U.S. state whose economy is a giant on the world stage — my home state of Florida. If Florida were measured as a stand-alone nation, the peninsula would have the 15th largest GNP in the world. Over 40% of U.S. trade with Latin America and the Caribbean flows through the state. And with negotiations this year to push ahead Free Trade Area of the Americas (FTAA), the odds are good that Florida will play an even more vital role in this expanding area of U.S. trade.
Although Florida’s trade relations are organized within the constraints of national laws, most of the promotion, facilitation and networking activities underpinning that trade is home grown. Tourism remains a powerful economic force, but trade has become the state’s engine of growth.
To that end, Florida has developed a “foreign policy” to increase the prosperity and the quality of life of Floridians by expanding our network of agreements with other countries, provinces and cities.
These agreements cover areas ranging from trade and investment promotion to cultural and educational exchange. The state provides political backing and directs participants toward private and public funding sources, but the main energy for implementing these agreements comes from private citizens and organizations.
Florida has signed and put into action several non-binding agreements with national governments on education and culture. One recent example is Florida’s cultural agreement with Mexico that generated such activities as elementary school classes in both countries communicating which each other via the Internet. A strong surge in commerce between Mexico and Florida, stimulated by a trade mission in 1999, has accompanied these cultural exchanges.
Florida has hosted the FTAA administrative secretariat in Miami for the past three years — providing offices, equipment, interpretation and other support.
Private, local and state funds have been drawn upon in an effort to underscore the suitability of Miami as the site for the permanent FTAA secretariat when treaty negotiations likely conclude in 2005.
Florida will also send a delegation to the Business Forum of the Americas in Buenos Aires (April 4-6, 2001) to help develop business sector policy input to the FTAA Trade Ministerial occurring then.
And anyone who still wonders about U.S. “isolationism” in world affairs would do well to attend Florida’s annual “International Days” event in Tallahassee, Florida’s capital city, on February 20-21. The event brings together about 500 internationally connected Floridians, their organizations and national and international speakers to address key issues of international involvement.
During that meeting, participants will discuss Florida’s relations with four major regions of the world: Latin America and the Caribbean, Asia, Africa and Europe. Florida’s state-level version of the Peace Corps, the Florida Association of Voluntary Agencies for Caribbean Action, will give a report on recent volunteer missions in the Caribbean Basin. Its two-week technical missions have provided assistance on issues as diverse as hog-fertility and television production.
Finally, groups such as Enterprise Florida, an independent organization that helps boost foreign trade and investment, will host international business strategy sessions. Florida’s citizens will have the opportunity to organize themselves to express their views on trade policy to Washington, as well as directly to the business sectors and governments of other countries.
These activities, increasingly commonplace in Florida, have helped the state develop into a major international presence. This state, which has historically thrived on growing fruit, tourism and catering to retirees, has assumed a new orientation over the past decade, participating fully in the global economy — becoming a powerful sub-national actor.
Of course, what remains to be seen is whether the role of states as sub-national actors will increase or diminish over time. But since globalization is leading to increasingly porous international borders, it seems likely that states like Florida will find themselves playing greater and greater roles in the global economy.
Founder and chairman of Simon, Kucher & Partners Strategy & Marketing Consultants Hermann Simon is founder and chairman of Simon, Kucher & Partners Strategy & Marketing Consultants. He is also a Permanent Visiting Professor at the London Business School. From 1989 to 1994, Mr. Simon held the Marketing chair at Johannes-Gutenberg-University in Mainz, Germany. From […]