INLAND EMPIRE EXPORT ASSISTANCE CENTER

U.S. Department of Commerce, International Trade Administration, Inland Empire Export Assistance Center

Located in Ontario, California, the Inland Empire Export Assistance Center supports businesses in Riverside and San Bernardino Counties, from Pomona to Palm Springs and Temecula to Barstow.

County Merchandise Exports

Inland Empire merchandise exports totaled $5.4 billion in 2009 (latest available data), accounting for 5.7% of the region’s economic output. Exports from the region grew on average by an astounding 17% per year from 2003-2008 as the region’s economy expanded, contributing to the economic growth and overall employment levels. The global recession of 2008-2009 caused a worldwide collapse in international trade volumes, which had a direct adverse impact on the Inland Empire’s economy. Exports in the region plunged precipitously, contracting by 14.2% in 2009. This decline had a profound negative effect on the region’s growth and employment levels: manufacturing declined by 34,000 jobs during the crisis with an additional 30,000 jobs lost in trade, transportation and utilities. As the world economy emerged from the recession, trade volumes rebounded rapidly in 2010 spurred primarily by a robust cycle of global inventory restocking after a sharp drawdown during the recession. The IEES projects that Inland Empire exports grew by 17.9% in 2010 to over $6.3 billion, followed by an additional projected increase of 11.4% in 2011.

The trading partners for Inland Empire are concentrated into a few main areas with exports to NAFTA accounting for 34.7% of total export volumes, Asia for 27.1% and the European Union for 24.1%. Canada is the main destination with $1 billion of exports or 18.8% of region’s total exports, followed by Mexico (15.9%) and the Netherlands (11.1%). China and Japan, the top two Asian export destinations for the region, combine for an additional 11.1% of total export volumes. The profile of Inland Empire’s exports is highly concentrated on manufactured equipments which combine for about 75% of total exports from the region. Computer and Electronic Product Manufacturing and Miscellaneous Manufacturing each had over $1 billion in exports in 2009. In fact, all top five export sectors from the region were in manufacturing with Computer and Electronic Product Manufacturing accounting for 19.8% of all exports, Miscellaneous Manufacturing for 19.5%, Transportation Equipment for 13.1%, Machinery Manufacturing for 7.7% and Chemical Manufacturing for 7.0%.

The outlook for Inland Empire’s exports is for robust growth over the next three years, although the rate of increase is expected to moderate from its escalated pace of 2010. This reflects in part the sluggish recovery in advanced economies which is further endangered by massive fiscal contractions in these countries over the next few years. While emerging economies should continue to grow, the pace is expected to be at a lower clip than in 2010 largely due to an engineered “soft-landing” by their governments to combat inflationary pressures, asset prices bubbles, and massive capital inflows. We project Inland Empire’s exports to grow by an annual rate of over 11% over the next three years. Longer term, the region has an immense potential to significantly expand its role in international trade. Recognizing this potential, local governments have taken a few important steps towards boosting the region’s exports. Several Inland Empire agencies and organizations have actively sought to expand the role of local firms in international markets by providing training, education and support to help businesses identify and grow their global customer base. The region has signed bilateral agreements with other countries, hosted trade delegations and worked closely with foreign consulates and trade agencies to promote increased cooperation.

At the national level, the National Export Initiative (NEI) put forth by the administration with the goal of doubling U.S. exports over the next five years should also boost exports from Inland Empire. Free trade agreements with Korea, Panama and Columbia — which were approved by the U.S. Congress this past October — are also expected to provide additional support for the region’s role in international trade. Additionally, Inland Empire’s exports should benefit further upon the successful completion of the Doha Round (the current trade-negotiation round of the World Trade Organization (WTO)) and the Trans-Pacific Strategic Economic Partnership Agreement (a free trade agreement that aims to integrate the economies of the Asia-Pacific region and the U.S.).

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