State Trade Directors Share Best Practices on Exports, Foreign Investment

In his State of the Union speech earlier this year, President Obama promoted international trade as a way to improve the U.S. economy. As the federal government focuses on concluding two large free trade agreements on the international front, state trade offices are well positioned to help small businesses navigate the export process here at home. And the State International Development Organizations, a CSG affiliate program commonly known as SIDO, is helping states do this even better.

Despite 95 percent of the world’s consumers living outside of the United States, only 1 percent of small businesses in the U.S. export. According to the National Small Business Association, one of the largest challenges of exporting is a lack of understanding about the export process. While small businesses benefit from free trade agreements, navigating the exporting process can be a major obstacle.

In April, state trade leaders came together in Washington, D.C., to share best practices and improve their ability to help small businesses export their goods. As part of SIDO’s 2015 Annual Forum, more than 60 trade directors and staff from nearly 40 states met with federal counterparts, private sector representatives and key congressional staffers to find ways to improve the overall trade process to help the nation’s small businesses export.

Ann Pardalos, the manager of the Missouri International Trade and Investment Office and SIDO’s 2015 president, said that without states’ “participation and insights (at the forum), we would not be able to have a constructive dialogue with our federal partners and to identify some concrete changes” to improve the overall export process.

At the forum, state trade directors met with officials from the U.S. Department of Commerce, Small Business Administration, the U.S. Trade Representative’s Office, U.S. Department of Agriculture, Export-Import Bank and the U.S. Department of State for open dialogue on ways to make the export process easier for states’ small businesses. Two key outcomes from these conversations include plans to harmonize metrics to measure exports and launching state-federal export plans to avoid duplication in federal and state services provided to small businesses.

Another challenge is that state trade office budgets have yet to reach pre-recession funding levels. To help offset budget reductions, Congress developed the State Trade and Export Promotion grant program, commonly referred to as the STEP program. Through STEP, the Small Business Administration provides matching grants to help state trade and export agencies support small businesses wishing to enter and succeed in the global market.

According to a recent survey conducted by SIDO, more than 80 percent of state trade directors find STEP to be “very important” or “extremely important” to the success of their export promotion efforts. In fact, eight states report that the STEP program provides more than half of their total budget for export promotion activities.

The STEP program has provided tangible benefits to U.S. small businesses too, supporting $575 million in actual and projected export sales in 2012.

“Through STEP awards, the SBA can work together with states to help more small businesses become exporters and expand their export sales,” Maria Contreras-Sweet, administrator of the Small Business Administration, said in an April 7 press release. “In the process, these small businesses will create jobs and strengthen the economies in their communities, across their state and the nation.”

The 2015 STEP program application process is now open and state trade agencies can apply through May 20.