This document discusses foreign direct investment (FDI) and how communities can attract it. It provides an overview of two companies, Atlas Advertising and Investment Consulting Associates, that help communities develop FDI strategies. The document describes trends in FDI, how companies evaluate locations, and challenges communities face in attracting FDI. It also outlines a potential joint project between the two companies to create an FDI master plan for a community.

1. How Your Community Is (Or Isn't) Being Evaluated for Foreign Direct Investment (FDI)

2. Your Hosts Ben Wright CEO, Atlas Advertising benw@atlas-advertising.com www.twitter.com/atlasad Douglas van den Berghe Managing Director Investment Consulting Associates douglas@ic-associates.com Guillermo Mazier Business Development, Atlas Advertising guillermom@atlas-advertising.com www.twitter.com/atlasad

3. About Atlas Atlas Advertising helps economic developers reach national and international prospect and site selection audiences. We deliver branding, website development, GIS mapping, research, social media, and creative services professionally and with a staff experienced in economic development. Unlike firms with little or no economic development experience, Atlas Advertising uses a proven mix of economic development marketing tactics that generate interest from site selection audiences. Atlas Advertising is led by a former economic development practitioner and has worked with 70+ different economic development clients in nearly 40 US states and six countries. Our approach and experience means that our campaigns generate an average of three to ten times the response of other campaigns. Featured clients: State of Ohio Nogales, Mexico City of San Francisco Greater Phoenix Economic Council Greater Omaha Economic Development Partnership Webster City, Iowa

4. About Investment Consulting Associates Investment Consulting Associates (ICA) is an independent adviser to companies optimizing their global supply chains and location portfolios. ICA also supports governments in building and enhancing their Foreign Direct Investment (FDI) and economic development strategies. Through our global partner network and multi-disciplinary approach we can assist our clients with an integrated package of service offerings. Our business philosophy is to utilize smart and efficient software solutions in providing dedicated and tailored consulting services. LocationSelector.com and ICAincentives.comare two of our flagship web based products for companies and governments assessing and benchmarking the competitiveness of global business locations and optimizing their incentive potential. This unique service offering differentiates Investment Consulting Associates from traditional management consulting firms who are active in the field of investment promotion and corporate site selection services.Many of our clients are ranked among the world’s 500 largest companies, but we also advise midsized businesses, nonprofit organizations, and government agencies. Our global track record supports our mission to become world leader in FDI advisory.

5. Download the slides, listen to the video, continue the dialogue Continue the Conversation: Follow us on Twitter: www.twitter.com/AtlasAd Tweet questions using hashtag #AskAtlas Join Next Gen Economic Development Marketers LinkedIn Group View and share the slides with your colleagues (available now): http://bit.ly/fQB6hC View and share the video with your colleagues (Will be posted later this week): http://bit.ly/fjc3Ex

6. Introducing the Atlas / ICA FDI Master Plan. Work with Atlas and ICA jointly to create your future FDI master plan. An FDI master plan includes: A road map for short, medium and long term FDI success for your community Best practices for servicing global business location decision makers An assessment of current strategy and target markets Recommendations for target investor countries/regions, based on your target industry profile Platform to benchmarking your community with other communities/countries around the world FDI marketing and communications plan Tips for partnering with regions or states

7. Audience Question:Have you worked on projects that are expansions or relocations of foreign owned companies this year?

8. Outline Why FDI should be an important part of your strategy today Challenges you face currently in FDI attraction Trends in FDI in the United States How foreign-owned companies evaluate communities today: Current case studies Q+A

9. Why FDI should be an important part of your strategy today

10. White House Touts Growing Foreign Direct Investment In The U.S. “At a time where we need to use every tool in our toolbox to continue to put Americans back to work and grow the economy here at home, promoting foreign direct investment is an important opportunity to accelerate our economic recovery,” President Obama said in a written statement. Labor Availability and Quality Peak in the United States

11. FDI is growing again, and projected to grow Source: UNCTAD FDI Database

12. Further the US is the global leader in inflows and outflows

13. Audience Question: What are your objectives for FDI in the coming year?

14. Challenges you face

15. The federal government plays a limited role in FDI promotion

17. San Francisco

18. Los Angeles

19. Dallas

21. Comparing individual cities within countries can be difficult

22. Audience Question: What tactics have you found to be successful in overcoming these challenges in your community?

23. Trends in Foreign Direct Investment

24. Global FDI trends – regional differentiation 20 Years ago – shift from Bi-Polar to Tri-Polar according first World Investment Report Currently – shift from Tri-Polar to Emerging Markets (EM) Role of European Union in world outward FDI stock decreased (from 85% in 1990 to 70% currently) Japan no longer qualifies as a Tri-Polar “pole” (at least 10% FDI global outflows) The Share of the top 20 EM’s in Global FDI Stock rose from 6% to approximately 15% between 1990 – 2010 The position of the United States will be challenged by the EM’s, but there are also positive signs

25. Implications for the US US Competitiveness for FDI “Revival of the US Manufacturing Powerhouse” Repatriation and Re-shoring of US companies and business activities Market Seeking: Traditional markets EU still of importance Changing Target Markets – Increased importance of Emerging Markets especially for Greenfield investments

26. Anecdotal evidence – examples of re-shoring activities in the US Ford Motor Company and Wham-O (the makers of the Frisbee®) are cited as having already brought production back to the U.S. Germany-based Automaker Quaprotek USA invests $22 Million in a new Tennessee facility that brings over 120 jobs to the area. Presair, a manufacturer north of New York City, will return production of its switches from China by this Fall, 2011. The reasons included long lead times for product and the tying up of capital needed for expansion. While Presair will see its costs jump 8% with the move back to the U.S., its CEO Art Blumenthal believes those higher costs will evaporate with the rising costs of manufacturing in Asia. NCR plans to begin a second production shift, which will result in a total of 800 new (re-shored) jobs to Columbus, Georgia.

27. Volatile FDI trend pattern

28. Growing importance of EM countries for Greenfield investments in the US Source: Organization for International Investment 2011

29. Top countries by US Greenfield Investment Job Creation – and Industry Sector Analysis Source: Organization for International Investment 2011

30. Global FDI drivers and trends – a future forecast Resource seeking Market seeking Efficiency seeking Strategic-asset seeking Enhancing synergies (i.e. technology, marketing channels and management expertise Exploiting different factor endowments Supply chain optimization Raw materials, Energy sources following customers, suppliers or competitors abroad CRISIS 1994 $256 billion 2007 record $1,833 billion 2013 $1,8 billion Relocation/ Expansions/ Offshore/sourcing

31. Audience Question: What country or countries are you most aggressively targeting?

32. How foreign owned companies evaluate locations: A recent case study

33. 1990 location selection process Site visits Journals Newspapers Brochures Trade Shows SIX MONTHS City City City City City City City City City

34. 2011 location selection process EIGHT WEEKS 85% of initial search = Internet Detailed info Services

36. Define real estate objectives and accommodation needs

37. Resources for site visits

38. Define project and goals

39. Business requirements

41. Build model for location analysis

42. Present rankings of locations

43. Sensitivity analysis

45. Prepare discussions with relevant governments and service providers

46. Incentive negotiations

47. Determine geographic scope

48. Selection of location factors

49. Weighting location criteria

50. Set up cost model

51. Cost differentials between locations

52. Real estate transaction and acquisition supportCorporate investment routemap A New Generation in FDI Advisory

54. Building €6,500.000

55. Machinery & equipment to be moved from an existing site €3.500.000

56. New machinery & equipment €2.500.000

57. Employees 50-75 (fte) with 2-3 shiftsThe main question company “Bulk and Specialty” is facing: Should we keep the operation in US State I, or is it worthwhile to relocate within the US, Mexico or even China

58. Case study: company ABC Phase 1 Business drivers and challenges – Chemical Industry High impact of energy of and feedstock costs Limited growth potential in current US State I due to saturated markets and demographic impacts Migration of more and more customer-industries to low-cost countries Growing commoditization New competitors from Asia and Middle East: pressure on margins Increasing regulations

59. Scenario approach Phase 1 Base case scenario: stay in US State I Supply chain effective scenario: Relocate to Mid-West Illinois – Missouri – Iowa - Ohio 3. Labor cost effective scenario: Relocate to Mexico Mexico Overseas offshore scenario China A New Generation in FDI Advisory

60. Location factor groups Phase 2 The following location factor groups were incorporated in the analysis: BUSINESS ENVIRONMENT FACTORS LABOR COSTS FACTORS LABOR AVAILABILITY LABOR PRODUCTIVITY ACCESSIBILITY FACTORS COUNTRY REPUTATION SUPPLY CHAIN MANAGEMENT REAL ESTATE FACTORS TAXATION & CUSTOMS GRANTS & INCENTIVES QUALITY OF LIFE ENVIRONMENTAL COSTS EVALUATION BUSINESS RISKS ELECTRICAL POWER

61. Benchmarking techniques – LocationSelector.com

62. Financial due diligence Phase 3 Logistics Duties Tariffs Utilities Salaries Depreciation Local Taxes

63. Region / State Scoreboard Analyses

64. Realestate – Deal making Brownfield solutions Greenfield solutions Build to Suit on Industrial Parks

66. Investment plans

67. Policies and incentives

68. Procedures requirements

69. Progress and achievements

70. Create awareness

71. Information provision

72. Assistance with contacts

73. One-stop-shop services

74. Assessment of manpower,,Infrastructure service needs

76. Information & Marketing

77. Missions & Events

78. Company targeting

79. Company visits

80. Follow-up

81. Continued “account executive attention”

82. “Ombudsman” role and trouble-shooting function

83. Follow-up on manpower, infrastructure, service needsPhase 1 Phase 2 Phase 3 Phase 4 Phase 5 Image Building Investor Servicing

84. The most frequently evaluated communities in the U.S. for FDI are…

85. Most frequent considered communities for FDI European / Asian companies tend to initially focus first on those metropolitan areas where they can find the following multipliers: Presence of local accountant and bank branches they already work with Similar expat communities - Metropolitan quality of life Presence of Universities where young foreign entrepreneurs study Flight Connectivity and Geographical proximity (East coast vs. West coast) Mental Map – Usual suspects European companies New York Chicago Boston Atlanta San Francisco Asian companies Los Angeles San Francisco Chicago New York

86. Most frequent considered communities for FDI Second tier metropolitan areas located in Central and Mid-West States are less frequent mentioned Kansas City Cincinnati St. Louis Memphis Minneapolis Yet, these cities offer in many different cases an excellent location proposition with cost and risk levels well balanced

87. Q + A

88. The Atlas / ICA FDI Master Plan. Work with Atlas and ICA jointly to create your future FDI master plan. An FDI master plan includes: A road map for short, medium and long term FDI success for your community Best practices for servicing global business location decision makers An assessment of current strategy and target markets Recommendations for target investor countries/regions, based on your target industry profile Benchmarking your community with other communities/countries around the world FDI marketing and communications plan Tips for partnering with regions or states

89. Coming to IEDC in Charlotte? To reserve your place, simply type “RSVP” into your chat box.

90. Contact Information Contact information: Gustav Mahlerplein 109 - 111 Amsterdam, 1082 MS Contact: Douglas van den berghe t: +31 (0)207946081 douglas@ic-associates.com www.ic-associates.com Contact information: 2601 Blake Street, Suite 301 Denver, CO 80205 Contact: Ben Wright t: 303.292.3300 x 210 benw@Atlas-Advertising.com www.Atlas-Advertising.com LinkedIn Profile| LinkedIn Group | Twitter| Blog| Slidespace