Tuesday, August 10, 2010

Moving Michigan Into A Top Notch Global Market by Akindele Akinyemi

In 2009, 70% of global growth came from developing and emerging market countries; Africa ranked third after China and India in terms of growth rates. Various companies from developing and emerging markets are increasingly the source of corporate leadership and business innovations. Developing and emerging markets are incubators for the companies growing from within.

Therefore, Michigan and in particular its urban environments must begin to invest in the benefits of whatever speed of broadband is under consideration.For example, telecommunications giant AT&T is investing $19 billion in wireless and broadband services. Investment translates into jobs as well as benefits to companies and consumers. Investment also benefits the entire telecoms sector because the trickle down to partners and suppliers is substantial. Investment empowers the new applications environment and benefits public policy, e.g. by enabling the creation of new platforms for innovation in areas such as healthcare, education and the environment.

However, in order to create a competitive, world-class knowledge economy we will need to develop a plan that includes substantial investment. We must remind our state lawmakers that the government’s job is to remove the barriers preventing investment in R&D and education by the private sector. At the same time, Michigan must cut through the tangle of red tape that makes it impossible to get anything done.

Companies from developing countries are tough and resilient and can deal with challenging environments in their DNA. They understand how to attract a large but frugal consumer base and can withstand macroeconomic insecurity. For example, African entrepreneurs are successful partially because living with uncertainty is in their blood. Now, how do companies in Africa expand beyond national borders and become regional and global players and connect to international borders like Detroit and Windsor, Ontario?

Local companies must understand and be successful in the national market and then overcome regional challenges before going global. A key advantage of national companies over multinationals seeking to exploit domestic markets is an inbred understanding of cultural sensitivities. This understanding pays dividends when companies from developing and emerging market countries expand.

Therefore, the private sector has a responsibility to drive growth and innovation. We also must connect urban communities with the global market by tapping into areas that are emerging markets. For example, Africa is fueled by an entrepreneurial spirit. One has to just look around to see millions of business transactions taking place, from local markets to the business of national champions. However, most African businesses face obstacles in taking their businesses across borders. The challenges of working cross-border are “very real” and can limit a company’s growth. Overcoming these obstacles will be a major driver for growth and create the connectivity to feed both regional and pan-African trade. The question becomes how do cities like Detroit and Benton Harbor tap into potential trade and development since both cities sit on water?

It is important to implementing robust frameworks for business to create a transparent environment that will in return build consumer confidence. Alternatively, the most important thing cities like Detroit can do is to open up, bring in technology to build human resource capacity – particularly by empowering women – and create healthy business ecosystems. This is why we need more public-private partnerships.

By saying this one of the greatest risks we face as we strive to redesign the urban systems we use to govern our lives is not to disrupt whatever behavioral spirits have allowed us to be so successful. We must be careful not to introduce barriers to progress in our inner cities. Nor can we be complacent. Many problems and risks obviously remain. The environment is in jeopardy, the population is swelling along with the ranks of young people without jobs. We have largely failed, moreover, to reduce the global imbalances in savings and trade that set the stage for the crisis.

As we move forward we must keep in mind four fundamental prerequisites to maintaining sustainable long-term economic growth: effective education, social stability, incentives for taking risks and integration with the global economy. More specifically to our present predicament, though, we need to reduce the role of financial speculation in our economy relative to real production. Our urban infrastructure must strive for a better balance in our economy, between spending and consumption, between domestic and foreign demand, between financial innovation and technological innovation, between rapid growth and sustainable development and between globalization and regional integration.

In the decade ahead, Michigan will be first to reach a number of milestones as it seeks to leverage its growing technological sophistication to meet the needs of its population. If we can stay focused with reinventing education through curriculum and instruction our state could be the first state in the United States to succeed in educating most of its population through the Internet. Between now and 2020 our state will need to invest about $1 billion to implement educational distance-learning projects and other technological advances to make us globally competitive.

An advanced educational population can develop quantum computers as an industry where it could enhance National Security. We already have Tech Town here in Detroit where bio-science technology is occurring and right next door is Next Energy where fuel cell technology is being developed. However, let's not stop there. Southwest Detroit could harness a research technology park dealing with life sciences and environmental issues, the East Side can develop an agricultural research technology park with a MSU Experiment Station and Northwest Detroit can become home to a regional technology park that focus on information technology and telecommunications. It's important that these research technology parks collaborate and partner with our community colleges and universities to become successful.

The next 10 years will be a challenge for the State of Michigan. We can no longer afford backwards thinking to dominate cities like Detroit. With industries coming online that are dealing with bio-engineering, water technology, only 10.8% of residents living in Detroit have a bachelors degree and 4% have a graduate degree. Additionally, 33.3 percent of Detroit residents were below the poverty level, compared to 13.2 percent of the U.S. population as a whole. More than half (an estimated 51.0 percent) of “female headed households with related children under 18 years” in Detroit were below the poverty level (nationally, the number was 36.3 percent). This is unacceptable. We simply do not have time to argue about who controls Detroit Public Schools when we are constantly losing another generation to the lost culture. It is up to us to promote both academics and connect the curriculum to entrepreneurship through financial literacy and accountability.

There is no way we can move forward in the 21st century if we do not address education and economics. Let's take a look to diversify our population and make education, trade and skills, and financial literacy a top priority in our respective communities. Urban educational empowerment zones are necessary to help revitalize and transform our community. We have to move Detroit and other urban areas in our state into the global market if we want to survive.

The views in this article are strictly my opinion and do not reflect the views of others.

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