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Strategic Objective 1.1Enhance economic growth for all Americans by developing partnerships with private sector and nongovernmental organizations
This objective is important to the nation as it increases private enterprise and job creation in economically distressed communities and regions; improves community capacity to achieve and sustain economic growth; increases trade opportunities for U.S. firms to advance U.S. international commercial and strategic interests, expands U.S. exporter base, improves customer and stakeholder satisfaction, improves the U.S. competitive advantage through global e-commerce, and increases opportunities and access for minority-owned businesses to the marketplace and financing. The Department assists economically distressed communities and regions by promoting a favorable business environment through its strategic investments in public infrastructure and technology. These investments help attract private capital investment and jobs that address problems of high unemployment, low per capita income, and severe economic challenges. For example, an EDA investment to Florence-Darlington Technical College in South Carolina during fiscal year (FY) 2005 will provide training for workers in advanced manufacturing technologies such as robotics, computer technology, and other modern manufacturing techniques necessary to sustaining industry cluster survival and competitiveness in the global marketplace. Twenty-six employers have committed to creating 764 new jobs, saving 417 existing jobs, and generating over $317 million in private investment as a result of this investment. An EDA investment to Pamlico Community College near Grantsboro, North Carolina, will result in the construction of a 21,284 square foot Workforce Training Center. The center is expected to result in the creation of over 2,000 new jobs and generation of private investment in the region of over $400 million in private investment. Another EDA investment in Washington County, Pennsylvania, will address the lack of developable land in that region through earthwork and infrastructural improvements. This investment is expected to result in the creation of 4,000 new jobs and $171 million in private investment. The Department also supports effective decision-making by local officials through its capacity-building programs. The Comprehensive Economic Development Strategy (CEDS) program, supported by EDA through its support of partnership planning programs, has proven particularly effective in this regard. For example, the CEDS process of the First District Association of Local Governments in South Dakota resulted in 136 new initiatives of which 16 were related to infrastructure, three to building construction and rehabilitation, and 90 to technical assistance efforts. Enhancing economic growth through partnering with other government agencies and the business community to increase exports is a key approach to implementing the Department’s Objective 1.1. Export expansion is an important driver for U.S. economic growth since export related jobs pay significantly higher wages. At present, one of every 10 dollars in the U.S. economy is linked to exports. For example, the Small Business Administration (SBA), Export-Import Bank, and ITA partner together with the business community to assist individual exporters by bringing small business services, export services, and finance assistance under one roof, in ITA’s U.S. Export Assistance Centers (USEAC). It often takes more than a great product to build global success. Good contacts, knowledge of international business practices, and exposure in foreign markets are all prerequisites for companies hoping to succeed worldwide. For small companies without an entire international sales force, this can prove quite a hurdle. With some timely help from ITA, Daniel Wallek, International Marketing Director of Mediafour Corporation, a Des Moines, Iowa-based information technology (IT) company, learned this from experience. Mediafour has signed agreements with exclusive distributors in 15 countries and has shipped its product to 64 countries. Mediafour used a combination of ITA’s U.S. and Foreign Commercial Service (US&FCS) products and services to build a worldwide distributor network. The company credits the US&FCS’s Gold Key Service with helping Mediafour find a distributor in Finland and the Baltic countries. For a nominal fee, US&FCS officers arranged appointments with prescreened foreign companies, and also provided transportation and translation services. Mediafour also took part in a telecom/IT Matchmaker trade mission to Belgium to find a distributor there. Matchmaker missions help businesses explore overseas trade opportunities through receptions, site visits, and face-to-face meetings with prescreened contacts. The Department helps minority-owned businesses obtain access to public and private debt and equity financing, market opportunities, and management and business information to increase business growth in the minority business community. Some examples:
Performance Goal: Increase private enterprise and job creation in economically distressed communities (EDA)
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Rating | Results |
---|---|
On Target | 2 |
Slightly Below Target | 0 |
Below Target | 0 |
See Appendix A: Performance and Resource Tables for individual reported results. |
Preliminary data collected through the Government Performance and Results Act (GPRA) process for investments made in FY 1999 and FY 2002 indicates that these EDA investments have helped generate more than $3.57 billion in private sector investment and create and retain 67,046 jobs. EDA anticipates that as these investments continue to mature and more data become available, these numbers will continue to grow. EDA anticipates that FY 1999 and FY 2002 investments will generate more jobs as time progresses so that at the nine year (FY 1999 investments) and six year (FY 2002) reporting time, these amounts will be significantly greater. EDA performance targets for long-term program outcomes are based on nine-year projections for private dollars invested and jobs created. Performance data are obtained at three and six-year intervals to provide snapshots of current progress in achieving the full nine-year performance projection. The private investment targets for FY 1999 and FY 2002 EDA investments were $1,040 million after six years and $390 million after three years. Data reported in FY 2005 shows that EDA exceeded those projections by 72 percent and 459 percent, respectively. Similarly, jobs created or retained in distressed communities as a result of EDA investments in the same years exceeded projections by 67 percent and 71 percent and totaled 47,374 and 19,672, respectively.
EDA is continuing to work with its partners to implement its Results-Driven Performance initiative launched in 2004 to focus on economic development initiatives that achieve the highest rate of return on the taxpayers’ investment. Specific efforts include implementing the revised Investment Policy Guidelines and focusing EDA funding effective investments that would not be eligible under other federal programs and that attract private capital investment and create higher-skill, higher-wage jobs.
All EDA investments are compliant with EDA’s Investment Policy Guidelines to ensure that an investment will be part of an overarching, long term strategy that enhances a region’s success in achieving a rising standard of living, and will demonstrate a high degree of commitment by exhibiting strong cooperation between the business sector; relevant regional partners; and local, state, and federal governments. Peer reviews are conducted every three years for each of the Economic Development District (EDD) Partnership Planning investment recipients, and the EDA regional offices continue to monitor the performance of all investment recipients.
Rating | Results |
---|---|
On Target | 6 |
Slightly Below Target | 0 |
Below Target | 0 |
See Appendix A: Performance and Resource Tables for individual reported results. |
EDA continues to build upon its partnerships with local development officials; EDDs; University Centers (UC); faith-based and community-based organizations; and local, state, and federal agencies. EDA’s approach is to support local planning and long-term partnerships with state and regional organizations that can assist distressed communities with strategic planning and investment activities. This process helps communities set priorities, determine the viability of projects, leverage outside resources to improve the local economy, and sustain long-term economic growth.
EDA is in the process of implementing a three-year competition cycle for UC funding. In FY 2004, EDA’s Denver and Austin regional offices conducted open competitions for UC funding. During FY 2005, EDA held similar competitions in its Chicago and Philadelphia regions, and for FY 2006 will hold competitions in its Seattle and Atlanta regions. In FY 2007, the cycle will be restarted with competitions in Denver and Austin. These competitions will help to ensure that EDA and the nation’s taxpayers will realize the maximum returns on their investments from the UC program resources.
The data used to evaluate the effectiveness of performance goal achievements are reviewed carefully and the Department attests to the accuracy and reliability of the data. For jobs created and retained, the regional offices screen data reported by recipients for reasonableness, and the Budget and Performance Evaluation Division analyzes the data for the presence of “outliers” and works with regional offices to verify actual data reported that appears to be atypical. In addition, headquarters and regional staff validate reported impacts by visiting randomly chosen recipients each year.
Two EDA program evaluations were initiated for EDA programs this year, of which one was completed. The study completed addressed the Economic Adjustment program, and the general conclusion was that this program was valuable and useful. Another study addressing the effectiveness of all EDA was initiated during FY 2005 but not completed. Evaluation studies of EDA programs can be found on EDA’s Web site at:
Rating | Results |
---|---|
On Target | 1 |
Slightly Below Target | 0 |
Below Target | 0 |
See Appendix A: Performance and Resource Tables for individual reported results. |
ITA’s Market Access and Compliance (MAC) program addresses numerous challenges faced by U.S. exporters, and supports critical compliance and market access trade policy issues in areas like international standards setting, currency, and intellectual property, as well as trade compliance policy issues involving transparency, good governance, and rule-of-law requirements. MAC uses a range of techniques to advocate on behalf of U.S. business and intervene with other governments to ensure foreign compliance with existing trade agreements and to eliminate trade barriers. Trade agreement compliance and foreign trade barriers have been a continuous problem for U.S. exporting firms, large and small. Many companies, especially small and medium sized firms, do not have the resources, knowledge, or leverage to influence foreign governments’ laws, and regulatory regimes.
ITA’s Manufacturing and Services (MAS) program advances and strengthens the competitiveness of U.S. industry by researching and analyzing U.S. business sectors and the competitive impact these sectors have on domestic and international business environments.
ITA identified several key priorities that it has addressed during FY 2005. These priorities include:
Rating | Results |
---|---|
On Target | 4 |
Slightly Below Target | 0 |
Below Target | 1 |
See Appendix A: Performance and Resource Tables for individual reported results. |
One of ITA’s key objectives is to place primary emphasis on the promotion of goods and services from the U.S., particularly by SMEs, and on the protection of U.S. business interests abroad. Within ITA, the US&FCS seeks to increase export opportunity awareness among U.S. companies. The US&FCS program proactively identifies potential exporters and existing exporters who need assistance and provides a range of export assistance programs. These products and services are supported by systems that leverage electronic and traditional media, centralize and manage relationships with US&FCS customers, and develop alliances and partnerships with other export support organizations to deliver export results. ITA’s Advocacy Center recorded a 12 percent advocacy success rate with an estimated value of $6.5 billion in U.S. export content.
ITA’s US&FCS facilitated 12,518 export transactions. ITA helped 4,888 U.S. companies enter a new market and helped 620 U.S. companies export for the first time. The latter representing 89 percent of its goal of 700 companies. External factors have impacted this effort. Although the weak dollar has increased exports overseas, rising energy costs, market uncertainties, and trade disruptive externalities such as hurricanes have impacted many companies seeking to expand to new markets overseas. ITA continues to encourage U.S. exporters to enter new markets in regions of the world least impacted by stated externalities. For example, a firm currently exporting to Canada may be encouraged to enter Mexico.
During the past year, both the Inspector General (IG) and independent auditors have reviewed and found discrepancies in collected and reported US&FCS performance data. This issue has becoming increasingly critical because of the heightened emphasis that is being placed on performance results. US&FCS and ITA’s Chief Financial Officer (CFO) have initiated actions to ensure effective performance-measure oversight through close coordination with ITA measure owners and through a program of independent verification and validation (IV&V) reviews.
In FY 2005, ITA’s Planning and Performance Management Staff, in conjunction with ITA Program “Measure Owners,” will have conducted IV&V reviews of selected performance measures. This includes reviews in ITA’s Import Administration (IA) program, ITA’s MAC program, ITA’s US&FCS program, including two US&FCS USEACs in the domestic field (Rosslyn, VA and Chicago, IL), a detailed review of the US&FCS Export Transaction Measure completed in conjunction with Department staff, and a review of export successes at the US&FCS overseas posts in Brussels. In the spirit of the President’s Management Agenda (PMA), these reviews have enabled ITA to verify and measure data that highlights/conveys progress toward achieving ITA strategic goals. The IV&V reviews have addressed data collection and reporting issues, inconsistencies, and accountability weaknesses identified in IG Inspection reports completed for Chicago, Philadelphia, Turkey, India, and the Pacific Northwest; and follow through on ITA’s resulting Action Plans. The IV&V review in IA addressed weaknesses regarding statutory deadlines. These IV&V reviews reinforce ITA’s and the Department’s credibility on planning and performance management and provide an opportunity for ITA to strengthen internal controls and to clarify and harmonize performance data reporting standards worldwide.
In addition to the areas described above, ITA has focused on two key priorities under this performance goal in FY 2005:
Rating | Results |
---|---|
On Target | 6 |
Slightly Below Target | 0 |
Below Target | 1 |
See Appendix A: Performance and Resource Tables for individual reported results. |
MBDA’s mission is to achieve entrepreneurial parity for MBEs by enhancing their ability to grow and compete in the global economy.
MBDA has targeted its strategic goals and performance measures to ensure the efficient and effective allocation of its resources. Programs focused on providing access to capital and markets will continue to be the prime components of MBDA’s minority business development initiatives. The success of these results-oriented initiatives is measured by their impact on minority MBEs and the U.S. economy. These outcomes are carefully tracked and verified through electronic and manual performance reporting systems.
MBDA is successfully implementing an Agency Strategic Growth Policy designed to focus its resources on medium to large sized MBEs that have the greatest impact on the minority community and the U.S. economy. This strategic direction ensures that MBDA’s resources help to achieve entrepreneurial parity for minority businesses, particularly as it relates to gross receipts and job creation. As a result of the Agency Strategic Growth Policy, a Strategic Growth Initiative has been implemented within all agency programs.
New strategic public and private sector partnerships help MBDA leverage its resources and add value to the services provided by the MBDCs and the Minority Business Opportunity Committees (MBOC).
New strategic partnerships have led to many successful opportunities, providing value-added resources to support the services of the MBDCs and MBOCs. Specifically, partnerships with the National Urban League, USDA, Microsoft, Forbes, and the Kauffman Foundation will strengthen minority participation by leveraging resources and providing valuable assistance to grow firms. Likewise, a training program conducted by the Amos Tuck Business School at Dartmouth College provided a curriculum to service medium and large size minority firms in meeting the challenge of a fast growing minority population.
The MBDA Portal has successfully become a Virtual Business Center offering new tools, services, and a message board for information exchange for MBEs to better compete in the worldwide economy. Continuous improvements provide new enhancements and sources of information and technology to improve the services available. The portal serves as an information clearinghouse and the center for referral of opportunities and resources to registered minority firms.
On September 11-14, 2005, MBDA held its annual National Minority Enterprise Development (MED) Week conference. It is the premier conference empowering MBEs to succeed. The theme for MED Week 2005 was “The Art of the Deal: Making It Happen.” The conference featured exceptional speakers who shared best practices for successful deal making in today’s business landscape. Attendees benefited from valuable dealmaking techniques and tactics in a structured networking environment, which in some cases resulted in new business relationships. MED Week 2005 provides critical information to the minority business community, and to corporate America, which increasingly recognizes that minorities are the fastest growing segment of the nation’s population and a significant economic force.
MBDA’s Office of Performance and Program Evaluation continues to review agency programs to improve efficiency and productivity. In FY 2005, an evaluation of the MBDC and NABDC program has made recommendations to improve the design and implementation of the program to meet objectives and performance targets. As a result, current policies are being revised and a new BDC competitive solicitation will be prepared for advertisement next year.
MBDA is one of the first agencies in the Department to establish a Customer Relations Management System throughout the agency and its funded network. A delivery model that will improve client services and operations has been implemented. This further supports the PMA and will strengthen accountability.
MBDA plans to incorporate the recently approved Central American Free Trade Agreement (CAFTA) into its outreach and advocacy activities in partnership with ITA.
During 2005, MBDA established two new offices of operation, namely, the White House Initiative for Asian Americans and Pacific Islanders and the Office of Native American Business Development. They will focus services on the special needs of these ethnic groups to improve business participation and capacity.
The number of clients receiving services will fall short of the expected target. The Strategic Growth Initiative seeks larger prime contracts with higher dollar values. Larger awards are being obtained for clients to impact jobs and growth. Due to the Strategic Growth Initiative, MBDA is now assisting larger firms with growth potential. Several small minority-owned businesses are being referred to SBA, local non-profit partner organizations, and other resources available from state and local governments. Therefore, the total number of firms assisted is decreasing.
In the coming year, MBDA is committed to the following strategies for improving its performance:
EDA’s “Results-Driven Performance” initiative has reached many communities and regions across the United States through satellite telecasts, forums, e-newsletters, magazines, and other means. Communities target their economic development strategies to attract private sector investments and higher-skill, higher-wage jobs using their EDA-funded CEDS process, Trade Adjustment Assistance Center (TAAC) activities, and UC assistance. EDA brings all these capacity-building resources together to provide communities with innovative and entrepreneurial talent that will achieve and sustain economic growth where it is most needed.
ITA has a strategy to address the challenges posed by changing economic, technological, and global business conditions to help U.S firms expand and conduct business abroad. ITA has made much progress in expanding U.S. exports while supporting U.S. government foreign policy initiatives; both the Iraq and Afghanistan task forces have helped generate export sales in those countries while supporting the U.S. foreign policy goal of regional stability. By generating U.S. exports, ITA simultaneously supports the development of a stronger market-oriented economic system in areas of the world (Africa, Middle East), contributing both to U.S. economic goals and global stability.
Large portions of ITA’s resources are directed toward ensuring that U.S. SMEs, service industries, and manufacturers can compete and win in the global economy. ITA supports the President’s economic program of export expansion by reasserting leadership in international trade through negotiations, through compliance, and by seeking the removal of non-tariff trade barriers. ITA assists in the development of commercial infrastructure in target markets such as China, Turkey, and India.
The health of the U.S. economy depends on its SMEs. The US&FCS program’s mandate is to create an environment in which all U.S. firms, including SMEs, can flourish. In order to achieve this, the US&FCS program seeks to increase export opportunity awareness among U.S. companies by identifying potential exporters who need assistance, leveraging electronic and traditional media, centralizing relationships with customers, and developing alliances and partnerships to deliver export assistance. A unique global network of trade professionals located in more than 250 offices covering 80 countries and 47 states, plus Puerto Rico, capitalizes on high export areas identified by trade patterns and as stated in the TPCC’s National Export Strategy.
The US&FCS offers a large array of specialized products and services to assist U.S companies, especially SMEs. ITA’s US&FCS has also initiated a rollout of revised product prices that will enable ITA to fully recover costs for specialized products and services in accordance with the Office of Management and Budget (OMB) requirements. Full implementation is pending the FY 2006 appropriation as the Senate mark instructed the Department not to move to full cost recovery.
US&FCS remains committed to opening and expanding foreign markets for U.S. goods and services and improving U.S. export performance. In FY 2005, the US&FCS continues its focus on several key program initiatives that have helped to boost the number of U.S. companies that win contracts and export. The President and Congress have mandated several of these initiatives. These initiatives are:
ITA’s customers are U.S. businesses. U.S. firms have expressed several needs for enhanced products and service offerings and service delivery capabilities from ITA to export more successfully in a fair trade environment. U.S. businesses want online customized information products and simplified access to ITA services. The success of ITA efforts depends upon effectively addressing the challenges faced by ITA’s customers in foreign markets balanced with meeting the expectations and needs of its stakeholders.
ITA will continue to achieve its customer satisfaction strategies by providing high-quality services and customized solutions to help U.S. firms export and by providing services through a unique global network of knowledgeable professionals who put their clients first.
ITA continues its focus on e-commerce as a major channel to further U.S. exports. The scope of e-commerce influence is broad, covering market access, customs, services, government procurement, and other areas of export promotion. ITA’s e-commerce export promotion program has four main goals: helping small businesses use the Internet to find markets overseas, helping established U.S. IT companies to expand overseas, helping emerging economies make the transition to the digital age, and ensuring that both the Internet and foreign markets are open and accessible.
ITA will increase efforts to promote U.S. companies’ bids in regions with higher e-commerce export potential.
The Census Bureau is currently releasing the Survey of Business Owners - 2002, formerly titled the Survey of Minority-Owned Business Enterprises (SMOBE) - 1997. MBDA will conduct longitudinal research and data analysis of this survey to address the growth and changes in minority business, specifically, the number of firms by ethnic category, gross receipts changes, the increase in jobs, the business participation rates of each minority group, and geographical movements in minority business. This data will provide special profiles and support future decisions by MBDA.
The opportunities of the worldwide economy will be available to those communities that focus on innovation, entrepreneurship, and cooperative regional approaches to economic development. Communities and regions need to adapt to this reality. Many will require outside assistance to do so.
The Base Realignment and Closure Plan announced in 2005 and the severe hurricanes of 2005 further add to the demand for tools such as the Economic Adjustment Program.
Changing economic, technological, and social conditions in the last decade have altered how international trade is conducted. This changing international trading environment presents U.S. exporters with numerous challenges and opportunities, such as domestic and international competitiveness; compliance with WTO accession requirements for nations like China; standards, currency, and intellectual property issues; as well as transparency and rule-of-law requirements.
MBDA will continue to meet its challenges by sustaining the overall return on program investment; provide staff and project training in collaboration with the Amos Tuck School of Business at Dartmouth; implement phase two of the Customer Relationship Management initiative; and Re-engineer the BDC technical assistance program to better serve high growth minority firms.
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