Florida Exports To Spain Tumble 30
Written by Scott Blake on April 5, 2012
By Scott Blake
With the state’s strongest business ties to Spain, Greater Miami is feeling ripple effects from the Spanish economic crisis.
Florida exports to Spain fell by nearly 30% last year, as consumer demand there has slumped amid devastatingly high unemployment rates.
Don’t expect the situation to markedly improve until next year, said Mario Buisán, Spain’s US trade commissioner in Miami.
"We know that this year is going to be difficult," Mr. Buisán said about his home country. "I’m optimistic that the right reforms are being made. There needs to be some austerity, so the economy is not going to grow this year, but I expect 2013 to be much better."
A part of South Florida’s economy hopes he is correct.
Among roughly 300 Spanish companies doing business in Florida, an estimated 250 of them are in South Florida, with the heaviest concentration in Miami. Also, Florida exports to Spain total several hundred million dollars a year, a vast majority of which comes from South Florida.
However, assessments of the Spanish economy remain dire.
"Right now, it’s in bad shape," said Joseph Smith, vice president of the Florida Foreign Trade Association. "They have needed the European [Central] Bank to bail them out, like they did for Greece."
Spain has suffered with unemployment rates around 25% this year. That and other economic troubles have translated into less demand for goods from Florida and elsewhere.
Florida’s top exports to Spain historically have been pharmaceuticals, medical instruments and equipment, aircraft parts, motor vehicles, and boats and yachts. However, some of those, such as pharmaceuticals and medical equipment, have been cut to a fraction of what they once were.
The total value of all Florida exports to Spain dropped to $316.2 million in 2011, down 29.7% from $449.6 million in 2010, according to Enterprise Florida, the state’s economic development agency.
Meanwhile, as the US economy has partially rebounded from its own deep recession, Spanish exports to Florida have risen sharply. The total value of Spanish imports in Florida rose 54.2% to $530.5 million in 2011, statistics show.
Florida’s largest imports from Spain, by far, are oil and petroleum products. Those are followed by items such as perfumes, ceramic tiles, wine and olive oil.
Overall, Spain ranks as Florida’s 33rd largest trading partner, in total value of imports and exports. Trade with Spain is somewhat more concentrated in South Florida, ranking as the region’s 30th largest trading partner.
National statistics for trade with Spain show the same trends: a decrease in exports and an increase in imports.
Nationwide, Spain also is a major investor. As of 2010, the stock of foreign direct investment from Spain to the US stood at $44.2 billion, making it the 11th largest investor in the US, according to SelectUSA, an organization that works to attract US business investment.
Largely based on increased Spanish exports to the US and other markets, the most resilient part of Spain’s economy has been its foreign trade sector, Mr. Buisán said.
Similar to what happened with the US economy in recent years, Spain experienced a property boom from 1997 to 2007, as some observers predicted the Spanish economy would outgrow others in Europe. But a sharp rise in personal debt in Spain helped push the economy into a financial crisis that struck in 2008.
During the Spanish boom years, a number of companies there began looking to overseas markets. The result was a marked increase in the number of Spanish firms doing business in Florida from about 2004 to 2009, Mr. Buisán said.
"In the last two years," he added, the number of Spanish business arrivals "has been slower, but they’re still coming."