Local business leaders met with an investment group from China last week to learn from each other and discuss opportunities.
The meeting was facilitated by Global Ties Arizona, which “builds and strengthens relationships between its members, businesses and nations through international exchange and educational programs,” according to its website.
Glenn Hamer, president and CEO of the Arizona Chamber of Commerce and Industry touched on the importance of the Arizona-China relationship.
“We understand the importance of trade and we want to see good relations between both countries. It’s important for our economy,” Hamer said.
China is Arizona’s number three export market behind Mexico and Canada, according to the Department of Commerce.
“We’re the fourteenth largest state out of 50 in terms of population, so we’re a larger state now than Massachusetts- a lot of people don’t know that,” Hamer said. “Phoenix is now the fifth largest city in the United States.”
When asked what sets Arizona- especially Phoenix- apart from other growing areas, Hamer said the state’s proximity to Silicon Valley provides an advantage.
Silicon Valley is a leader in technology and innovation and some companies based there- PayPal, Google, Lyft- have operations in Arizona.
“We’re close to that activity,” Hamer said. “By far the largest source of technology and venture capital comes from Silicon Valley and it’s a very easy flight to make from the Silicon Valley area to Phoenix.”
In terms of job growth and economic prosperity, Arizona’s strong university system helps it stand out in the crowd.
“Our education system, particularly at the university level, is very good,” Hamer explained.
A 2019 Arizona Board of Regents report shows Arizona’s major universities offer more than just an education.
Arizona State University, Northern Arizona University and the University of Arizona created an $11.1 billion total economic impact during FY 2017. They also created about 84,000 jobs.
“If you go to the downtown Phoenix area where Arizona State [University] has some operations and Tempe, Arizona which is right next to Phoenix, there’s a vibrancy because of the university,” Hamer explained to the delegation.
Hamer and the Chinese representatives also discussed Arizona’s tax system and what makes it attractive.
“We’ve set up our tax law to really encourage the companies that are going to hire our workers but then export goods all over the country and the world,” Hamer said.
He explained that Arizona has a tax advantage for companies in foreign trade zones that are export-oriented by lowering taxes for those businesses.
According to the Arizona Commerce Authority, businesses can receive up to a 72.9 percent reduction in state real and personal property taxes if they are located in a foreign trade zone or sub-zone.