China and Los Angeles County: Growing Together LAEDC International Trade Outlook June 5, 2014 Ferdinando Nando Guerra International Economist, Los Angeles County Economic Development Corporation (LAEDC)
China & Los Angeles County Overview of the Report Key Findings Executive Summary Introduction Historical Ties Personal Ties The Chinese Economy Trade Ties Investment Ties Business Ties The Future of the Relationship Conclusions
China and the U.S. No Other Relationship Will Be As Critical as the American-Sino Relationship in the 21 st Century -- President Barack Obama
China and Los Angeles County Los Angeles is the Epicenter of the U.S.-China Relationship -- President Xi Jinping
Key Economic Findings Investment from China has doubled in the last 5 years Tourism has nearly quadrupled over the past 4 years LACD handles nearly 45% of trade between China-U.S. China accounts for nearly 60% of all activity at the ports LACD Exports have increased by over 50% since 2009
Los Angeles County Largest Chinese Population Largest Number of Chinese Students Largest Number of Chinese Companies Largest Recipient of Chinese Tourists Largest Recipient of Chinese Investment
Chinese Investment into the U.S., CA and L.A. Area Investment into the U.S. was $14 billion in 2013 Private Chinese companies are leading the way Accounted for more than 70,000 full-time jobs California has attracted about 1/3 of U.S. investment L.A. Metro Area is the top destination in California Source: Rhodium Group
Chinese Investment into L.A. County Investment has increased from 127 establishments to 254 in the past 5 years China is now approaching the top 5 ranking Over 40 cities have received investment Largest investment includes the Greenland Group s $1 billion property development near L.A. Live The Metropolis Project Upwards of $36 billion at stake for the L.A. Metro Area by 2020 Source: LAEDC Database, Chinese Enterprise Council and Rhodium Group
40 35 2013 LACD Top 10 Export Destinations Billions of $ $35.4 30 25 20 15 10 5 $15.2 $11.1 $7.8 $7.1 $5.1 $4.2 $3.0 $2.9 $2.5 0 *China includes the Mainland, Hong Kong and Macau Source: USA Trade Online
40 35 30 25 20 15 10 5 Billions of $ 14.1 16.2 LACD Exports to China* (2004-2013) 21.3 24.7 28.5 22.8 30.1 34.9 34.1 35.4 0 2004 2005 2006 2007 2008 2009 2010 2011 2012 2013 *Includes the Mainland, Hong Kong and Macau Source: USA Trade Online, US Department of Commerce
Top 5 L.A. Metro Area Exports to China 1. Computers and Electronics (Precision Instruments and Semiconductors) 2. Transportation Equipment (Aircraft Products and Parts) 3. Chemicals (Pharma/Medicine) 4. Royalties (Motion Pictures) 5. Tourism Source: Brookings Institution
Chinese Tourists and Spending Number of Visitors (000's) Spending (Millions of $) 800 est. 655 570 450 470 273 268 339 158 169 2009 2010 2011 2012 2013 Source: LA Tourism and Convention Board
18,000 16,000 14,000 China s Real GDP Growth Average Annual Growth Rate: 10% Billions of CNY/RMB in 1990 Prices After Joining the WTO 12,000 10,000 8,000 6,000 4,000 2,000 0 1980 1981 1982 1983 1984 1985 1986 1987 1988 1989 1990 1991 1992 1993 1994 1995 1996 1997 1998 1999 2000 2001 2002 2003 2004 2005 2006 2007 2008 2009 2010 2011 Source: International Monetary Fund (IMF)
China and the Global Economy Largest Trading Nation in the world Largest Exporter in the world The 1st or 2nd largest trading partner of roughly 80 countries, which account for nearly 60% of global GDP China s share of global GDP has increased from 8% to 15% in just the past decade Source: International Monetary Fund (IMF) and Financial Times
16.0 14.0 12.0 10.0 Percentage 10.0 10.1 11.3 China Real GDP Growth (2003-2018) 12.7 14.2 9.6 9.2 10.4 9.3 Forecast 8.0 7.7 7.7 7.5 7.3 7.0 6.9 6.9 6.0 4.0 2.0 0.0 Source: IMF World Economic Outlook, April 2014
China s 12 th 5-Year Plan (2011-2015) Key Objectives Western Regions Environment Energy Efficiency Domestic Consumption Reduce Inequality Scientific Development Source: KPMG
The Future of the Chinese Economy Third Plenum of the Central Committee Economic Free Trade Zone of Shanghai Increased Open Markets Financial Reforms Consumer Spending Income Growth not GDP Growth
The Future of the China-L.A. County Relationship Key Sectors Clean Tech, Entertainment, Aerospace, E-Commerce, Real Estate/Property Development, Tourism, Logistics, and Electronics Key Challenges Key Opportunities Recommendations Personal Ties, Investment, Trade, Tourism, etc. THE BEST DAYS ARE AHEAD!!