International trade is an engine propelling the Houston region’s economy and trade is soaring.
As of Sept. ’18, exports from the Houston/Galveston customs district are up more than 32.9 percent. This is on top of more than 19 percent export growth for the region in ’17 where more than $109 billion was exported globally. Exports in the first three quarters of ’18 nearly equal all exports for ’17.
Imports have also seen robust growth in ’18 with an increase of more than 12.9 percent. This brings the Houston region’s growth in total trade (exports + imports) to more than 24 percent as of Sept. ‘18. Compared to other major metros, Houston’s strength in trade is evident.
Houston has had the strongest export growth of any major metro in the U.S. so far in ‘18 outpacing Dallas which has seen export growth of only 3.4 percent this year. Other metros trailing Houston’s 32.9 percent growth include Chicago (11.8 percent), New York City (9.4 percent), Boston (7.2 percent) and Los Angeles with only 2.8 percent export growth.
These are exciting times for trade. In light of the many events this year which could act as a headwind to international trade, the Houston region has shown its soaring strength
In April 2016, the Greater Houston Partnership launched the Houston Metro Export Plan which has convened Houston’s export ecosystem more than a dozen times since inception. The MEP Working Group has held Export Resource Forums at City Hall and the Partnership -as well as other key places in the region over the last two and a half years.
Foreign-owned firms continue to open factories and offices here. Overseas investors have acquired billions of dollars in local real estate. Houston welcomes three to four trade delegations every week. And a score of dignitaries, ambassadors and ministers from Europe, Asia, Africa and Latin America visit Houston frequently to promote closer ties.
As of our last annual count, forty-one foreign-owned firms opened or expanded operations in Houston, up from 25 in ’16. JSW Steel (Mumbai) announced hundreds of millions in investment in its Baytown steel mill. Lonza (Basel) has opened the world’s largest cell and gene therapy facility in Pearland. And the Industrial and Commercial Bank of China (Beijing), the largest bank in the world by total assets, recently established a branch office in the Uptown/Galleria area. Since January ’15, the start of the energy downturn, well over 100 foreign-owned firms have selected Houston for corporate expansions, relocations and startups.
The Greater Houston Partnership welcomes more than 150 trade delegations every year from around 50 countries seeking substantive engagement with the Houston region. The Brookings Institution estimates that 17.3 percent of Houston’s economy was tied to exports in ’17, nearly double the 8.9 percent of ’03. Brookings also estimates that exports supported 330,340 jobs last year, up from 169,460 jobs in ’03. Factor in imports of steel, plastics and chemicals that go into locally manufactured products and the share of Houston’s economy tied to global trade is undoubtedly much higher.
Over 8,000 ships call on the Port of Houston annually, and the Houston Airport System handles more than 11 million international passengers each year. Houston is connected via water to more than 200 ports and via air to more than 70 foreign markets.
One in four Houstonians, nearly 1.6 million residents, was born outside the U.S. Another 600,000 children under 17 have at least one foreign-born parent. As a group, Houston’s foreign-born population, their minor and adult children equal about 2.6 million residents, or 38 percent of Houston’s total population. Without them, Houston would slip from fifth to fifteenth in the metro rankings. Put more bluntly, without our foreign-born population, Houston would be a second-tier metro.
As one example, the community of Houstonians who identify as Indian continues to thrive. The region has over 150,000 people of Indian descent. In November of this year, the Partnership organized a 39-person strong delegation to New Delhi and Mumbai led by Mayor Sylvester Turner. Institutions with innovative leaders on the delegation included: Station Houston, Space Center Houston Gateway to NASA JSC, Houston Airport System, City of Houston, Indo-American Chamber of Commerce, Houston First and dozens of others representing healthcare, hospitality, education, information technology, law, real estate and the petrochemical industry.
Houston exports Sept. ’18 YTD to India are up more than 67.5 percent -a huge amount advancing India as one of Houston’s top 10 trade partners. Houston exports have grown this year to many other major markets including Mexico (27.8 percent), China (27.6 percent), the Netherlands (25.8 percent) and Japan (49.6 percent). Houston exports to Taiwan are up ’18 YTD an astonishing 405.5 percent, moving Taiwan from Houston’s 27th largest trade partner to 14th. If the trend holds in Q4, then Taiwan will most certainly be included as a 2018 top 20 trade partner for Houston.
These are exciting times for trade. In light of the many events this year which could act as a headwind to international trade, the Houston region has shown its soaring strength and the Partnership will continue to monitor and advance the global conversation for the benefit of our nearly 1,200 member companies and the Houston region as a whole.
Josh Davis, Director, International Trade – Greater Houston Partnership