Each year the World Economic Forum is held in the small Swiss city of Davos, attracting vast amounts of media attention.
Journalists simply can’t stay away from the chic, swish, ski resort.
I don’t know but maybe it was the theme - “Creating a Shared Future in a Fractured World” – that was too compelling for them?
Anyway, last week, Donald Trump’s surprise visit to Davos inevitably hogged the global focus.
It was however the comments of another new President, made in Davos just before team Trump rolled in, that caught my attention and that was Emmerson Mnangagwa, the new President of Zimbabwe.
Mnangagwa recently took the reins of that troubled country and his message to any well-healed masters of the universe prepared to listen was straight and simple - Zimbabwe is ‘open for business’, in other words, please come and invest in my country.
I’m unaware of the structure of Zimbabwe’s institutions but, by pitching the country as welcoming future inward investment, the President was essentially carrying out the function of an IPA, that is an Investment Promotion Agency.
Marketing Derby is an IPA as I mentioned at our Annual Business Event at the Derby Theatre earlier this month. Talking to people afterwards many were surprised to hear that most cities, regions and indeed countries, have some type of initiative selling its advantages to investors.
At the ABE I mentioned Invest in Lapland (yes, there is really such an organisation) who campaign that ‘All Signs Point to the Artic’. Plus, Invest in Hong Kong, this year’s winner of IPA of the Year (a moniker awarded by the respected Financial Times FDI magazine), whose slogan is ‘The Best Is Yet to Come’.
Truth is capital is global, mobile and competition between locations is tough and getting tougher.
When it comes to inward investment Derby has a pretty good track record.
Just over 100 years ago, following a some clever pitching on land and power supply, Rolls-Royce chose the city as its base, a decision that shapes our economy to this this day. Take a look at the massive investment programmes under way in their civil aerospace and nuclear facilities as evidence.
25 years ago, following a thorough and tough competitive process, Toyota chose Burnaston as its home – at that time the UK’s largest ever, foreign direct investment.
Of course, it is important to remember that, just like trade, investment is a two-way process – inward and outward.
Take a look at international investor magazines today and you will see European cities, such as Dublin, Paris and Frankfurt, actively pitching their case as the perfect location for any post-Brexit relocations from London.
Which brings me neatly on to what must be the mother of all investment opportunities currently playing out in north America.
Last year online retail giant, Amazon, launched a competition. They asked cities to throw their hat into the ring if they wished to host Amazon’s second home, having outgrown their first HQ in Seattle.
The opportunity is called HQ2 and I’ve never known an enquiry of this scale.
The prize is gargantuan - 8,000,000 sq feet of office space, $5billion of development and, wait for it, 50,000 new jobs.
You can only imagine the reaction in cities up and down the US and Canada.
No doubt each IPA would have made a high level assessment of how their location measured up against the terms of the competition – metrics such as population, talent and universities – before deciding whether or not to throw their hat in the ring.
In the end, an astonishing 238 locations submitted a bid to host HQ2.
Things are done different in America and most offered various incentives unthinkable here in the UK (the highest ‘bid’ being $7billion from New Jersey).
For me, the most interesting bid was that of tiny Stonecrest Georgia. There, the city council offered 345 acres of its own land and, best of all, have said they will rename the city to become City of Amazon.
Brilliant, but not brilliant enough because, in the end, the only language companies such as Amazon speak, is that of money.
Amazon have announced the final 20 cities.
In there are the usual suspects (LA, Boston, New York, New Jersey and many locations around Washington DC) as well as a few interesting, up and coming cities, such as Denver and Austin, Texas.
Big losers include Detroit and Houston both of whom have described their loss as a wake-up call.
Finally, it is with regret that I need to report that Amazon didn’t bite,
Heroic Stonecrest didn’t make the cut and so will remain known as the city of Stonecrest…that is of course until the next IPA mega-bid.
Having outgrown Cupertino California, Apple have already launched a HQ2 search of their own. What price city of Apple?