Governor & U.S. Commerce Secretary Highlight Importance of Foreign Investment and Trade

TAIJI HASEGAWA: Good afternoon, ladies and gentlemen, thank you for joining us today. My name is Taiji Hasegawa, the chairman for Hitachi Automotive Products USA, Inc.

Today is an exciting day for us and we are sincerely honored and privileged to be joined by Governor Schwarzenegger and U.S. Secretary of Commerce Carlos Gutierrez and to host today's tour of our facilities. In fact, our company was the only automotive company selected in the state by the governor and the secretary, which is truly a distinct honor and is a testament to our commitment to the spirit of what Invest in America is all about. Hitachi takes great pride in being a (Inaudible) and cutting edge innovative leader. We believe in environmental preservation and economic growth, always the primary focus for our society as a whole.

We have many guests joining us today, including executives from several of our affiliate Hitachi companies and Junichi Ihara, Consul General of Japan in Los Angeles, Los Angeles County Supervisor Don Knabe, Mayor Frank Scotto and the entire Torrance City Council, who have proclaimed today Hitachi Day here in Torrance.

Globally, Hitachi has over 380,000 employees and we will celebrate our 100th year anniversary in 2010. Since our founding, Hitachi has aimed to contribute to the solution of the fundamental issues faced by the global community and to create prosperous life cycles and a better society through growth integration of our CSR activities within our diverse business sectors.

Invest in America is a theme that resonates with Hitachi. In the United States and North America Hitachi Group companies employ over 16,000 people in good jobs providing technologies, products and services that contribute towards a sustainable society. Hitachi's corporate statement embodies Hitachi's commitment to continue to inspire coming generations and to create a more vibrant society and boldly face the future. We look forward to Hitachi's future in California and throughout America.

Thank you again for joining us today. And it is my distinct honor to now introduce Governor Arnold Schwarzenegger, ladies and gentlemen. (Applause)

GOVERNOR SCHWARZENEGGER: Thank you very much. Thank you for the kind introduction and thank you for the elected officials, for being here today. And I want to thank especially Secretary Gutierrez for being here today in Los Angeles and in California. And I want to thank also, of course, Hitachi for hosting this event here and being so gracious and showing us around this wonderful facility and all the great work that is being done here. And I, of course, want to thank all of you, the hardworking men and women that are working here in this facility here, for the great work you are doing, because it is because of you that we have a great economy and things are going well. So we want to thank you for the hard work and for the great contributions that all of you are making to the great state of California.

Now, we are here today to talk about a very important subject, which is foreign trade and foreign investment, direct investment in California and in the United States. And of course, Secretary Gutierrez has been doing a great job in putting the spotlight on that issue for the whole week and, as a matter of fact, for a long time already. But this week he made this the Invest in America Week. And so we want to thank you, Mr. Secretary, for picking the perfect state to cap off your celebration of Invest in America Week, because we are and we pride ourselves as being the number one state.

California leads the entire nation in foreign direct investment and we are grateful for the technology, for the opportunities and for the jobs this provides for our state. In fact, it is estimated that more than half a million workers are getting jobs here in California by foreign-owned companies and this is one example right here. And when you combine that with the billions of dollars worth of properties through foreign investment in factories and equipment, which is altogether $120 billion of investment, it all adds up to a giant recipe for California's success.

And so Hitachi is, of course, a perfect example of that. The company employs thousands of California workers at diverse facilities up and down the state. And we just saw some of the fantastic work that all of you are doing here in this plant. They take auto parts that would normally go to a junkyard and they refurbish them and restore them to be used again. I mean, this is really fantastic not only for our industry and for the economy, but it is also terrific for the environment because like I said, all of this would end up in the junkyard somewhere.

So this is why Hitachi has also won state and national environmental awards and the company has outlined an ambitious vision to fight global warming. So here we have all of this together. It stimulates the economy, it creates jobs, it creates revenues and it protects the environment at the same time, as I've said you can do all of those things. This is foreign investment at its best and we need to encourage more of it.

When we combine foreign investment with opening up overseas markets and stripping away trade barriers for our exports we ensure a stronger and more vibrant American economy. And California is at the forefront of that prosperity; as a matter of fact, in 2007 we sold $135 billion worth of goods overseas.

And that is why I support the Bush Administration's efforts to expand trade and I urge the Congress to come together and approve these pending free trade agreements with Colombia, with Panama and with South Korea. All of this will lead to more markets, more products, more jobs. And I know that California is ready to achieve even more success in the global economy. And I, of course, have always stressed how important it is that the world, the globe, is our marketplace and this is why I've gone on trade missions also overseas to sell great California goods overseas.

So again I want to say thank you very much, Secretary Gutierrez, for putting the spotlight on that. And you have my full support to make sure that the Bush Administration is successful in this endeavor and that we have Congress pass these free trade agreements, which are very important because it will increase, again like I said, our workforce, it will increase our revenues. And of course, as you know, with our budget situation we need more revenues in this state.

So again, thank you, thank you very much. And now let's bring out Secretary Gutierrez to say a few words about this. Thank you. Please give him a big hand. (Applause)

SECRETARY GUTIERREZ: Thank you, Governor. And I want to thank Governor Schwarzenegger for his leadership and just say to all of you in the state of California that you're fortunate that you have a governor who understands that the world is heading toward more open engagements, a lot more trade and those states and countries that will be successful are those that are willing to trade and open up and welcome investment and welcome job creation and focus on prosperity. So, Governor Schwarzenegger, thank you for your leadership and thank you for continuing to make California the great state that it is.

We all know, we all have heard that the economy has been slowing. And we saw that in the month of April; unfortunately, jobs were down by 20,000. And although that was below what many people expected, that is no consolation. Any time jobs are down we are concerned and we think that is absolutely unacceptable.

The slowing of GDP is also something that has concerned us and has concerned the president. GDP growth in the first quarter was point six percent. And, as we've been saying, the growth of GDP will slow down. Most economists believe that the first half of the year will be more difficult, that will be the difficult half; the second half of the year will be a lot stronger.

In order to be able to make that bridge to the second half of the year, last year in the fourth quarter the president decided that it would be good to have some insurance, a booster shot to the economy, something that would guard against a downside. So in the further quarter we developed a stimulus package that the president approved. And the interesting thing about that is that the only actual numbers we had were third-quarter numbers and the third quarter grew 4.9 percent. So we had to make a decision before all the numbers were in and we're very proud of the fact that the president decided early on, before people understood that we were going to face a downturn in the first half of the year.

So, as we speak today, we are sending out checks; up to last Friday 30 million Americans had received stimulus checks. As you know, $100 billion is going out; the average check is about $920 and that's going to be very helpful for the economy. But it's great and the timing couldn't be better that those checks are actually going out right now and in the month of June and in the month of July and that's going to spark consumer spending and economic growth. Seventy percent of our economy is consumer spending.

The other $50 billion will be related to incentives to invest, to bring forward capital investment and that will also help create jobs. The estimate, in fact, is that the whole stimulus package will create approximately 500,000 new jobs and will add point seven percent of GDP growth.

The bright spot of our economy right now is trade and Hitachi is a great example of why we need to be open to foreign investment and to trade. My understanding is that you have 16,000 employees in the U.S., 8,000 in California. Over 5 million jobs in the country are generated by foreign investors. So, as the Governor said, we welcome foreign investment and we think foreign investment is an important part of our economy. And, very importantly, we have to continue to be aggressive in accessing new markets. We did $1.6 trillion of trade last year. Our exports this year are growing by 18 percent; last year they grew 13 percent. We've had four years in a row where they have grown above 10 percent. That is the bright spot in our economy today.

And there is no reason why free trade agreements should be being held up. As the Governor mentioned, California exports $135 billion; that's more than most countries in the world. And exports in California are up over 43 percent in the last four years. So this is the time to be looking at exports the way we look at the stimulus package, to look at with a sense of urgency. And I join the Governor in calling on Congress to bring the Colombia agreement to a vote, then Panama and then Korea. All those three will help us create jobs and continue to grow.

So once again, Governor Schwarzenegger, thank you for your leadership. And all of you who work at Hitachi, congratulations for what you do and thank you for your very important contribution to the economy of the state of California and to the economy of our country. Thank you. (Applause)