24 Jul 2017
What can you do to attract Foreign Direct Investment?
fyi – GA’s Energy Cities at Work
2nd Quarter, 2017
While Foreign Direct Investment (FDI) is drawn to the American economy for its open markets and investment friendly climates, Georgia communities who want to attract those investors must reduce the risks for prospects and offer an alternative to some of their “at-home” issues of rising energy costs and wage rates, speed-to-market issues, and stiff regulatory environments.
“This is a 25-year decision for companies. Beyond the standard key location requirements, there is typically high-value on strong local leadership and governance stability,” says Blair. Even on a fast-track visit, prospects sense if the team is not pulling the rope together. “Leadership needs a common vision that a prospect can trust won’t dissolve with interpersonal conflicts,” explains FDI expert Jim Blair.
For those communities seeking FDI, I would encourage every community to invest in a five-year community assessment and strategic planning. You need a candid understanding of your strengths and weaknesses, how your community is positioned for speed-to-market and a means to promote yourself in a meaningful way. Plus, do all of this with an eye for foreign direct investment opportunities. A single trip to a prospect country is most likely not a sufficient strategy.
Familiarize yourself with the business climate conditions abroad. An FDI investor may have a track record where land is at a premium; with strong land use regulations that create restraints impeding a speedy start-up. A simple promise of how fast infrastructure might be expedited won’t satisfy a prospect. That prospect only has past experience by which to measure shovel-ready potential. Use your state certification program but don’t stop there. You need to be sure you have solved every challenge for a prospect.
Understand the intercultural aspects of your FDI relationship. Germany, for example, is currently a top investor in Georgia. Its representatives tend to be interested in process technologies, engineering and quality. Be able to talk that talk.
Workforce training is a challenge for communities large and small. Training programs that look like apprenticeships, a training model German culture embraces, provides a comfort level and reduces an area of risk.
Attracting FDI is just one more layer to your long-term planning. It needs to be comprehensive and strategic.
Learn more about GA’s Energy Cities each quarter. This issue covers such topics as public-private partnerships, entrepreneurs importance to our economy, and workforce initiatives.