Market Development Cooperator Program

MDCP first authorized in 1988, funded in 1993 Enabling legislation: Omnibus Trade and Competitiveness Act of 1988: MDCP is to be a unique way to "develop, maintain and expand foreign markets for nonagricultural U.S. goods and services." 15 U.S.C. Sec Funding: Jobs Through Exports Act of 1992 and Freedom Support Act of 1992: First MDCP awards, totaling over $2 million, were made in fiscal

Market Development Cooperator Program (MDCP) Cooperator Targeted foreign markets $300,000 Trade associations Each year the International Trade Administration (ITA) selects 7-9 trade associations and other non-profits industry groups for awards of up to $300,000 each. MDCP award recipients, “cooperators”, design projects to help small firms (SMEs) to export to targeted foreign markets. Project activities vary depending on the industry a cooperator is helping and the markets targeted. Examples include: -Participating in foreign trade shows -Opening a product demo center -Coordinating industry standards SMEs SMEs export Cooperator 3

MDCP Public-private partnership ITA. Trade associationsChambers of commerceState trade departmentsOther non-profits MDCP encourages industry groups to partner with ITA Targeted foreign markets Export multipliers: industry groups that do not export, but whose companies or business constituents do export Cooperator projects strengthen the global competitiveness of a U.S. industry, not just a particular company Each MDCP project team includes ITA and other federal specialists who work shoulder- to-shoulder with a cooperator SMEs export 4

Market Development Cooperator Program (MDCP) Cooperator Other federal agencies I&A Industry & Analysis GM Global Markets Project activities help small U.S. firms export Targeted foreign markets Non-profit industry groups compete for MDCP awards from ITA:  Up to $300,000  Partner w/federal agenciesen  Applications due: Februaryen “Cooperators” commit to:  Projects to engage small. firms in exporting  Term: 3-5 years  Two-thirds of total cost Joint team coordination $1 ITA. Trade associationsChambers of commerceState trade departments.Other non-profits Report export results Project-generated exports per $1 of MDCP award Product demo center Trade mission Technical seminar Foreign trade show Industry standards Foreign rep office $335 Report export results Evaluation Criteria 20% Potential to generate exports that..... create or sustain U.S. jobs 20% Export performance measurement 20% ITA partnership & priorities 20% Creativity & institutional capacity 20% Budget, match, sustainability 5

2015 ITA Priorities 1. Create or sustain U.S. jobs by increasing or maintaining exports 3. Increase exports by any of the following U.S. industries: Aerospace Transportation equipment Health/medical products/services Chemicals Processed foods Education Design/construction products/services Energy/environmental products/services Information/communications technology Media/entertainment Machinery/equipment Professional services Travel/tourism Logistics/distribution services 4. Help U.S. businesses to secure export financing 5. Engage more U.S. firms in major international trade shows and other significant foreign outreach activities 6. Help current exporters to expand to more markets 2. Major emerging markets with rapid growth and new customers such as: (see map) Required priorities: 1+ Any 2 of Address non-tariff barriers to U.S. exports such as discriminatory regulations, local content requirements, and technical requirements 8. Secure strong intellectual property rights protection and combat counterfeiting and piracy 9. Counter discriminatory trade policies such as "indigenous innovation" 10. Shape and encourage the adoption of standards outside the United States that are industry-developed, market- driven, science-based, and internationally recognized. Other priorities, 7- 10, none of which is required: 6

MDCP evaluation and debriefing 7 GM Global Markets I&A Industry & Analysis -Foreign posts -U.S. Export Assistance Ctrs -Country desks -Advocacy Ctr -Industry specialists -OPCM/MDCP -Intellectual property -Standards -Industry Advisory Committees MDCP Merit Review Panel I&A Assistant Secretary Top ranked Unsuccessful applicants Award announcement: -Members of Congress -DOC press release -Industry events GM Global Markets I&A Industry & Analysis -Foreign posts -U.S. Export Assistance Ctrs -Industry specialists -OPCM/MDCP Comments Debriefing 20% Potential to enhance competitiveness 20% Performance measurement 20% ITA partnership & priorities 20% Creativity & institutional capacity 20% Budget, match, sustainability Due: mid-February September October project start

8 Total project funding

Over the years cooperators have targeted 70 different markets (only the top 40 appear in the tag cloud above) China has overtaken Mexico as the market most often targeted by cooperators Other markets recently popular: Brazil, UAE, Indonesia Markets targeted by cooperators

MDCP examples of projects 10 SFSA’s MDCP project activity in the International Organization for Standardization (ISO) helped U.S. makers of various steel products increase exports by $129 m. AEM leveraged an MDCP award to open a Beijing office from which its staff reviews trade journals for construction bid opportunities in China and makes them available to AEM members via its website Steel products to Europe Construction equipment to China

MDCP RVs in China, Japan, Korea Temp Solution for Perms The Recreation Vehicle Industry Association (RVIA) received $300,000 in MDCP. One year into the project, RVIA has now hired a full-time representative who lives and works in East Asia. To date the project has generated $7 million in exports. Sales measured in hundreds of millions of dollars per year are on the horizon, especially in China, but not until China addresses standards and regulatory issues. Through the MDCP project, ITA is helping RVIA remove barriers. RVIA helped a member company sell this temporary beauty shop that replaces one destroyed in the recent tsunami. 11

MDCP specialty auto equipment to Gulf States & China Measuring session & trade shows ITA is helping the Specialty Equipment Market Association (SEMA) boost export to the Gulf States and to China. Rules on what is “street-legal” and who is authorized to customize a vehicle, e.g. vehicle manufacturer or local auto shop, are issues SEMA is addressing with ITA’s help. U.S. specialty auto equipment makers measure a Toyota Hi-Lux 4x4 truck. ITA helped SEMA get special permission to import the truck temporarily in the United States. The vehicle is not authorized for U.S. sale but is the highest selling vehicle worldwide that is likely to be customized. 12

Commitment and sustainability A cooperator must commit to provide at least two thirds of the resources required to undertake the project 13 At 67% of project cost, MDCP’s cost share requires commitment Sustainability is evident in the foreign presence (foothold) that we have helped industry groups to establish abroad _______________________________________________

Brad Hess Director, Market Development Cooperator Program Industry & Analysis 1401 Constitution Ave., NW, rm Washington, DC T M Market Development Cooperator Program (MDCP)