Reflections on the Select USA Summit and Other FDI Events
So the big Brexit news delayed this blog by a month, but I thought it was still worthwhile discussing the United States’ most important event for FDI. This was the third time that Select USA have held the event, and it will be the last for President Obama, responsible for the initial establishment of the organization. It’s ironic that a country with less focus on FDI in the past (despite / because of already being the largest recipient of FDI in the world), is now a leader in using this type of tool for attraction. So what was the event like this year, and is it a blueprint for other Economic Development Organizations (EDOs)?
The Summit is successful for various reasons, which mean other countries could not readily copy the model:
First, the US offer is strong: companies want to invest in the country.
Second, the American psyche includes an innate confidence in the country and what it can achieve - i.e. economic developers are confident in the ’product’ they are selling to investors.
Third, the US has the financial resource to organize such an event.
Fourth, given specific focus on FDI in economic development is relatively new in the US, most EDOs have a program and strategy that is still evolving. Therefore, there is a place for the federal government to host an event on all their behalves, while it may be less valid in countries where its regions have longer established FDI strategies of their own.
But the above does not mean that other countries cannot also host a similar, if smaller, event. For example, the UK holds conferences (as opposed to a Summit, while is primarily a trade show), and perhaps this will become ever more relevant in the context of Brexit.
Room for Improvement
In his speech, the President cited a number of deals that had taken place because of the Summit in the previous year. This shows a tangible outcome, but there is still scope for improvement, and these points would be transferable to other events:
The event was well attended again, with representatives from many overseas companies interested in investing, together with economic developers from across the country. However there can be a feeling of déjà vu: the event has been much the same each year, and is always held in Washington DC. For the event to avoid becoming stale, it probably needs to reflect the wide-ranging investment offer from all corners of the country. This is not to say that it becomes similar to the IEDC annual conference, but international (repeat) attendees and investors may be better served by providing variation.
While for a larger corporation or EDO, $750 per person may be insignificant, for smaller organizations this attendance fee, together with travel and accommodation costs can be substantial. It could be argued that this should not matter to a company serious about investing, but the world of Foreign Direct Investment today is increasingly driven by technology-based SMEs. These are the companies that the USA (and any other country) should be looking to attract while they are still in their nascent stages – after all, Facebook first started in a dorm room!