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International Trade
Export Boom
Brazil, Canada, Venezuela and Mexico remain our top foreign markets.
Florida's key exports include computers, electronics products and transportation equipment. Brazil, Canada, Venezuela and Mexico remain our top foreign markets. Despite some consolidation within the state's international trade sector, small niche exporters are thriving. "Small firms often succeed because they focus on a single export item to a single country," Lasaga says.
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Latin America's appetite for U.S. goods should remain strong this year as the region's own exports -- principally commodities and raw materials -- help stabilize currencies and put cash into consumers' pockets. The impact of CAFTA (Central American Free Trade Agreement) -- once a few kinks are ironed out -- also will be felt. "The good news for Florida's exporters is that the year ahead will be another one of economic growth for its trading partners," says Terry McCoy, director of the University of Florida's Latin American Business Environment Program.
Political uncertainties in Mexico and to a greater extent in Venezuela remain a cloud on the state's foreign trade horizon, adds McCoy. Flush with oil revenue, Venezuela is on a buying spree. Florida's exports to Venezuela jumped nearly 40% in 2005 alone to more than $2 billion -- about 6% of the state's total. "Whatever happens with Chavez will certainly be felt in Florida," says McCoy.
FREE TRADE
Shifting Gears
Hopes for a Free Trade Area of the Americas may be fading, but Florida's importers and exporters are eyeing a host of bilateral accords between the U.S. and its southern neighbors.
"This is really a renewed, reinvigorated approach to free trade," says Brian Dean, executive director of Florida FTAA, the office charged with landing a regional trade headquarters, or secretariat, in Miami.
Last year, Congress narrowly passed CAFTA, forging ties with Central America and the Dominican Republic. A deal with Peru is waiting congressional approval. Bilateral pacts with Colombia, Panama and Ecuador are in various stages, and the CARICOM bloc of Caribbean nations has announced a desire to hold talks with the U.S.
While FTAA's passage appears unlikely anytime soon, Dean believes the success of bilateral and smaller regional trade pacts will rekindle interest in a hemispheric accord. In any case, Dean adds, Florida must continue to position itself as the trade, transportation and business services capital of the Americas. "I think we will have an FTAA one day, and I think the headquarters will be in Miami," says Dean. "We just need to keep moving the ball down the field, little by little, building on what we've already accomplished. I think it's just a matter of time."
INTERNATIONAL BANKER
Growing Pains
Struggling with post-9/11 compliance laws and new trade routes for Latin goods, Florida's international bankers are losing market share to other banking centers across the globe. Some institutions are pulling out of Florida; statewide, direct employment was down 37% between 2000 and 2005, according to a recent report from the Florida International Bankers Association.
Association President Simon E. Amich of American Express Bank International in Miami lays much of the blame on the emergence of China, India, Japan and parts of Europe as consumers of Latin goods and commodities. When Brazilian steel is shipped directly to Asia rather than through the U.S., for example, bankers in Singapore, not Miami, are likely to finance the deal, Amich explains.
"Latin trade patterns are shifting," says Amich. "It used to be mostly north-south trade. Now we're getting much more east-west movement. The world is changing."
But Amich sees Florida's international banking niche as secure. As long as Florida remains a principal trading hub -- a fact few doubt -- bankers here will find work. Despite the dropoff, the state's international banking sector generated $1.8 billion in economic output last year and supported 13,600 jobs.
INSURANCE
Selling Base
Florida's prominence as an international trade capital helped spawn landmark legislation that allows overseas insurers to use the state as a base for selling insurance products to foreign residents. The year-old law streamlines the approval process for qualified insurers who see Florida as a better offshore location than the Cayman Islands, Bermuda or other finance centers to reach Latin American and other non-U.S. customer. To date, two companies -- Lombard International Assurance of Luxembourg, a subsidiary of France's BNP Paribas -- have received permission from the Florida Office of Insurance Regulation to operate here. Several other foreign insurers are in the application phase, officials say.
