New Jerseys Economic Efficiency Model
Chairman Suk Yeun-ho of the Korean Chamber of Commerce and Industry in the U.S. (KOCHAM) held a monthly meeting on May 25 at a Korean restaurant in Cliffside Park, New Jersey. KOCAM is an association of U.S.-based Korean firms.
Attending the luncheon meeting was also Virginia Bauer, Chief Executive Officer and Secretary of the New Jersey Commerce, Economic Growth and Tourism Commission. Although the occasion was more of a social gathering, with less than twenty participants, the states Commerce Secretary was there nonetheless.
In her speech, she explained with great fervor the New Jersey governments support programs for Korean subsidiary firms in the state and measures for cooperation.
New Jersey offers the best possible environment for Korean firms to make an investment in, being so close to New York and having excellent infrastructure in ports and roads. Just give us a call on our hotline, and we will provide a one-stop service on all the problems you meet in investing in our state. Because our conditions are so attractive, New Jersey brought in the nations eighth largest volume of Foreign Direct Investment last year.
Her words of pride for the state continued. New Jersey may be a relatively small state in the U.S. in terms of land size, but its economy is the eighth largest in the country. If it were a nation, it would be the 18th biggest economy in the world.
New Jersey is among the richest states in the U.S., with an average household income of 55,146 dollars as of 2000, which is nearly twice that of the least wealthy state, West Virginia, at 29,696 dollars.
However, New Jersey is by no means satisfied with where it is. The Commerce, Economic Growth and Tourism Commission, in particular, focuses on attracting new investment as its top priority, and devotes its full attention on preventing companies in New Jersey from deciding to take their business out of the state.
When a company creates jobs from new investment, the state government also provides it training expenses for new employees, as well as tax incentives.
Regulatory departments, such as the Environmental Protection Agency, have been placed under the direct control of the Commerce CEO/Secretary, so that the state can expedite investment procedures of firms, such as minimizing the time taken to authorize building new factories. The top post of the states Commerce Department has been given the title of CEO and secretary for the same reason.
The commission produces an annual report as companies do, in which it reviews the investment results of the state government, showing the number and volume of investment cases and new jobs created in the year. CEO-Secretary Bauer herself used to work for Merrill Lynch, a major investment bank, and decides the amount of support the state provides for a firms investment after a thorough cost efficiency analysis.
Why then is New Jersey so dedicated to attracting investment? To state the obvious, because investment creates jobs, which leads to higher income.
The key issue in the U.S. gubernatorial elections is invariably how much jobs grew by during a governors term in office, or how much they will grow once someone is elected to the post. One can often hear in the U.S. that if a governor successfully brings in a large investment project, thus creating thousands of new jobs, it will signal a green light for his or her reelection.
The tireless efforts of New Jersey to create jobs, when it is already among the richest states in the country, is truly a shining example of just what local government is all about.
Jong sik Kong kong@donga.com
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