In the past few weeks, I have been on the road almost continuously from one part of the world to another. Through a combination of business and pleasure, this has included travel to North and Central America, the Middle East, and even the Arctic! While of course somewhat tiring, there is no doubt that seeing such diversity in a short space of time, but with that common thread of friendliness, has been inspiring.
So from the economic development perspective, how does the smallest developing isolated community attract FDI, compared to the most cosmopolitan developed city? Well, the basic strategic principles should still remain broadly similar, and some of these ‘building blocks’ for any EDO or IPA include:
Identify your opportunity: understand the sectors, specific niches, activities and source locations from where you can attract investment. How might this change in the future?
Define your offer: where do your strengths lie – what niches can be identified as a competitive advantage? You can then align the opportunity (the demand side), alongside the offer (the supply side), and hence define the sectors and markets to proactively target.
Optimize the organizational structure: based on the above, targets for FDI should be set (projects, jobs, capex etc.). But in order to achieve them, the right level of resource with well-defined staff roles (and ideally previous experience) needs to be in place. A strategy is only as good as the tools available to implement it!
Strengthen your marketing approach: the difference between a company choosing your location and any other is often on the strength of presentation: if collateral looks and says the right things, the chances of gaining that ‘foot in the door’ with an investor are enhanced.
Establish principles of prioritization: not all companies represent the same level of opportunity for a location, or indeed have the same economic impact if they do invest. This does not mean ignoring some companies, but it is worth remembering the rule of thumb that around 20% of all companies will tend to provide around 80% of the impact to an economy.
Think like an investor: EDOs and IPAs ultimately exist to service the private sector. Therefore, staff need to put themselves in the position of that investor in order to get ahead of the competition: how does that company make its location choice - what is the process it follows?
Of course, every location has to tailor and implement its strategy to its own set of circumstances, and the points above are by no means exhaustive (we could add points about aftercare, evaluation, company research etc), but nevertheless we still return to this overarching structure. While there’s no question that every location and its EDO / IPA are different, they should not view themselves as somehow entirely unique (everywhere claims to be a ‘strategic location’!). Hence the prescription for successful FDI attraction will at its core, tend to follow a similar theme.
So, perspective is important, but by following such overall fundamentals, the smallest of communities is able to attract companies in the same way as a big city: after all, a 50 person investment from a little known company into a town of 5,000 people, can have at least as much positive economic impact as Google choosing its next 2,000 seat site in a major international city.