Before morphing into the Natural State, Arkansas proudly touted itself as the Land of Opportunity, promoting the state as fertile ground for the growth of business and industry.
That word spread globally, and today Arkansas enjoys the benefits of international companies building and expanding facilities -- economic growth, a more diverse economy and jobs for local folks.
Indeed, foreign direct investment today translates into 161 companies -- many with numerous locations -- operating in Arkansas. They represent 35 countries and provide 35,700 jobs to residents. That's 3.5% of the state's total private-industry employment. About 47,000 jobs in Arkansas are directly supported by majority foreign-owned businesses.
Over the past five years, 50 foreign companies operating in Arkansas have invested $2 billion to expand facilities or build new ones, all according to statistics provided by the Arkansas Economic Development Commission. This year, state efforts to continue drawing foreign investments included visits to China, Dubai, Germany, India and Japan.
There is, of course, volatility that also comes with foreign investments: U.S. trade policy. Last month, on a trip to Japan, Gov. Asa Hutchison held a news conference with reporters back home to announce that a major Chinese investment planned for the state would be delayed while the U.S. works out economic trade issues with China.
The proposed Clark County paper mill is a gem: a $1.8 billion investment that is projected to create 350 jobs. The economic impact is not just a ripple, but a wave: each mill job will pay $52,00 a year and the facility is expected to provide another 1,000 jobs in the logging industry and more than 2,000 jobs during construction.
The governor noted that Sun Paper intends to go forward with the investment once tariffs and other cost issues are better defined. For now, we know that bickering between the countries is creating uncertainties that have led the Chinese owners to hold back until there's more economic stability they can build a business plan around.
We'll have to wait and see how that works out. Though there could be a lot more riding on the trade dispute than the bounty the paper mill would provide. Today, China is Arkansas' top importing country and the state's fifth-largest export destination.
Exports are vital to the state's economy. Arkansas reaps dividends from international trade, which supports nearly 350,000 jobs, representing about 26% of the state's total employed labor force.
Exports for Arkansas have increased by nearly 12% over the past decade and now total $6.5 billion -- that puts the state about 37th in the nation. Goods sent out from Arkansas now reach 170 countries.
Canada and Mexico, not surprising since they border the U.S., are Arkansas' largest trading partners. Canada accounted for $1.2 billion in exports in 2018, or 18.74% of total exports. More than $870 million in goods were exported to Mexico.
Exports to Saudi Arabia exploded over the past year, increasing by 421.4% to $397 million. Saudi Arabia became the third most important export destination for Arkansas -- mostly triggered by munitions. Lockheed Martin's plant in Camden benefited from a new deal to sell missiles to the Saudi kingdom.
Taking a more peaceful approach to international relations, you can visit the Governor's Mansion next weekend and learn more about international trade and Christmas traditions in the countries that do business in Arkansas.
For the first time, the mansion is displaying trees decorated to feature 17 countries that have direct foreign investments in Arkansas.
Twenty-four high school art classes in Arkansas researched the Christmas traditions of individual countries and designed ornaments to reflect the country's values and included information related to investments in Arkansas. The tree on Canada, for example, includes the amount of Arkansas exports to the country, spending made by Canadian visitors to Arkansas and the number of Canadian companies operating in the state.
All are welcome to view the trees during an open house from 1-4 p.m. on Dec. 8. You can also schedule tours through the mansion's website. The trees are artificial, unlike the millions growing in Arkansas soil that attracted the Chinese and their paper-mill project.
RESOURCES FOR SMALL BUSINESSES
The Small Business Administration office in Arkansas is teaming up with the state's Community Bankers Association to help enhance resources and drive capital access across the state. The organizations will work together to help small businesses grow their operations and discover the financing tools that are available to them.
Arkansas' office, with locations in Little Rock and Fayetteville, has an extensive network of advisers and lenders it uses to support the nearly 250,000 small businesses operating in the state. The federal agency can support businesses at every stage of development.
The bankers' association was formed in 1980 and today serves all community banks and credit unions in Arkansas. Community banks and credit unions concentrate on serving local areas and make the majority of their loans in the trade areas where their deposits are gathered.
Together, the federal agency and the bankers' group will provide a powerhouse of information and resources to boost small businesses. Businesses in Arkansas will have access to nearly $164 million in loans to invest in their operations.
More information is available through both organizations.
BRANCHING OUT
First Community Bank of Batesville continues to expand across the state. The institution has added two more locations, one in Conway and another in Harrison. The Conway branch is at 1089 Front St. and the Harrison lending center is at 220 East Ridge Ave. Banking hours are 8:30 a.m.-5 p.m.
The bank now has 27 branches in Arkansas and southwest Missouri.
Arkansas locations include Baxter, Craighead, Independence, Jackson, Lonoke, Sharp, Poinsett, Pulaski and White counties. First Community has more than 400 employees and assets of $1.5 billion. In 1997, First Community Bank opened for business with 14 employees and $3.5 million in capital.
Column ideas or recommendations? Thoughts or musings that need pursuing? Contact me at amoreau@adgnewsroom.com or at 501-378-3567.
SundayMonday Business on 12/01/2019