Speaking to Qualcomm employees last week in San Diego, CA. Photo by Chris Stone/Times of San Diego.

Recipe for Success: San Diego and TPP

by U.S. Secretary of Commerce Penny Pritzker and Qualcomm CEO Steve Mollenkopf

Penny Pritzker
Aug 9, 2016 · 4 min read

San Diego may be best known for its sunny beaches and close proximity to California’s mountains and deserts, but one of its greatest geographic advantages is far less obvious.

Situated on the southern coastline of California, across the ocean from the booming economies of the Asia Pacific region, San Diego has historically served as a gateway for global commerce.

What we now know, thanks to a new study from the School of Global Policy and Strategy at UC San Diego, is that San Diego and California are uniquely positioned to benefit from the trade and investment opportunities made possible by the Trans-Pacific Partnership, or TPP.

Infographic on “What Drives San Diego’s Economy? The Region’s Most Concentrated Industries” from UCSD’s report, San Diego and the Trans-Pacific Partnership

Beyond its leading mobile technology sector, San Diego is home to aerospace companies developing unmanned vehicles, medical research institutes at the forefront of biotechnology, and colleges and universities that supply businesses with breakthrough discoveries and with highly skilled workers.

San Diego’s leading exporters have long enjoyed strong demand for their products in TPP countries like Japan, Malaysia, and Vietnam.

However, as this study notes, foreign taxes imposed on American-made products have increased the cost of doing business for these innovative firms, lowering the volume of exports that companies are able to send overseas.

By eliminating 18,000 tariffs, TPP will cut costs and boost revenues for San Diego businesses — supporting their ability to reinvest, expand, and create more jobs.

Infographic on “San Diego’s Export Economy: Top 10 Highest Value Exports” from UCSD’s report, San Diego and the Trans-Pacific Partnership

Qualcomm, a leading inventor of the wireless technologies that power our smartphones and mobile devices, is a perfect example of a San Diego company poised for greater success through the TPP.

This agreement addresses the unique 21st century challenges encountered by U.S. businesses abroad.

When countries fail to protect intellectual property or impose restrictions on the free flow of data across borders, innovative American technology companies like Qualcomm struggle to compete.

TPP prohibits new limits on cross-border data flows, requires stronger protections for intellectual property, and opens more markets to the companies that drive our growing digital economy.

Infographic on “San Diego’s Innovation Economy: San Diego is the 3rd Most Patent-Intensive Region in the World” from UCSD’s report, San Diego and the Trans-Pacfic Partnership

For these reasons and more, communities like San Diego should recognize the potential inherent in enacting TPP. Yet we cannot ignore that across America, many people are anxious about the prospect of more trade.

The anxiety comes from a simple fact: While our economy continues to grow and add jobs, the gains have not been felt evenly. Many are quick to blame trade agreements like TPP. However, the forces of globalization, automation, and digitization will continue to reshape our world whether we embrace new trade agreements or reject them.

The reality is that trade agreements represent our best opportunity to shape these forces and strengthen our competitive advantage worldwide.

As the Obama Administration and companies like Qualcomm work to help more people understand the benefits of the TPP, we must help more communities harness their own competitive advantages, just like San Diego.

We have far more work to do. But as we fight for the infrastructure, research, and education investments needed to help more Americans compete globally, we must also lead in writing the rules of 21st century commerce.

The time to act is now, because the cost of inaction is too high.

Indeed, a separate study from the Peterson Institute recently estimated that delaying TPP by even just a year would lead to a one-time national loss of $94 billion — hurting companies of all sizes.

Today, more than 775,000 Americans woke up and went to jobs supported by California’s exports. That is 80,000 more jobs than were supported by California’s exports in 2009. TPP will build on this progress by opening new markets, protecting American innovation, and cutting taxes for our companies.

Now is the time to seek solutions that will strengthen our workforce, level the playing field for our businesses, and grow our economy.

By keeping America on the leading edge of global competitiveness, we can keep San Diego open for business — and the world open to San Diego’s businesses.

Infographics from the ITA’s 2015 state report, California: Supporting Made-in-America Exports and Jobs

For more information on TPP and San Diego, see the executive summary and the full report by UC San Diego’s School of Global Policy and Strategy.

Penny Pritzker

Written by

The archived 2014–17 Medium account of former Secretary of Commerce Penny Pritzker. This account is inactive; see www.commerce.gov for current information.

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