The opportunity to do business overseas can create thousands of jobs for an economy and many for business. In the current environment, sometimes people scratch their head and wonder: Is this still a good time to do international business? Joshua Walker is the head of Global Strategic Initiatives with The Eurasia Group. He’s a diplomatic expert in international trade and business, and we’re going to talk with him about what he’s seen with...
The opportunity to do business overseas can create thousands of jobs for an economy and many for business. In the current environment, sometimes people scratch their head and wonder: Is this still a good time to do international business? Joshua Walker is the head of Global Strategic Initiatives with The Eurasia Group. He’s a diplomatic expert in international trade and business, and we’re going to talk with him about what he’s seen with respect to international opportunities for our regional economy. Joshua, thanks for joining us.
WALKER: Thanks for having me.
ABERMAN: Well, diplomacy. You have a background in diplomacy and I can’t think of a current environment where the President of the United States seems less diplomatic when it comes to international relations. How do businesses function in this current environment?
WALKER: I think, one of the things, as we’ve seen over the last year of the Trump Administration, is how to kind of discount the things we used to pay a lot of attention to. What I mean by that is words. The President of the United States, used to, whatever he said, was very carefully calibrated. Our diplomats, the State Department, everybody was carefully crafting that. Now the President goes directly to the people through Twitter, and so when you look at the first couple of this year, whether it’s attacking Pakistan or North Korea, business leaders have to king of tune that out a little, because that’s not relevant to them. I think, as business leader, figuring out where you’re going to invest, where you’re going have major opportunities around the world, you have to separate a little bit the political situation here in Washington and globally, with the fights that the President picks here and there, and try to hear: where can we actually get things done?
ABERMAN: So I understand that, with respect to a business person, I wouldn’t necessarily worry about a Twitter feed for determining where I saw economic opportunities. But how is it going for Americans overseas now that well, for example, I understand that you and the Eurasia Group are going to be doing a summit in Japan later in the spring. When you go overseas, and you talk with people in other countries, how are they feeling about Americans right now?
WALKER: I mean it’s interesting: we’ve seen a pendulum swing. I used to work under the Bush Administration and the Obama Administration and no matter what the feeling towards individual presidents–obviously Bush was not very popular, especially in the parts of the world I was working in, like Turkey, because of the war in Iraq. People seem to look at Obama as kind of being able to kind of solve all the ills of the world, and he kind of got all the hopes and dreams placed upon him. I’ve never seen an environment where people feel as sorry for Americans because of our political leaders and the irony of course is, people overseas saw Trump coming before most of us here in the Beltway ever did, and so as a result they say, look, we get it. We dealt with this before. Don’t worry, this too will pass. You have strong institutions–Congress will never let him do some of the crazy things out there. Of course, on foreign policy, that’s the one area the President of the United States has the ability to go to war and do other things on. So, I think people overseas are very sympathetic, but also, on the other hand, the economy’s doing really well right now, so you have this real juxtaposition position between geopolitical risk and some of the biggest risk we’ve ever seen. One of the reasons we’re doing this geopolitical summit in Japan, which is one of the largest economies in the world, is that it’s right on the front lines of some of the major issues of our day, whether it’s the North Korean missile crisis or whether it’s China and kind of the tensions that will continue to rise between them and the U.S.
ABERMAN: Japan’s a pretty interesting opportunity, because there you have the demographics–rapidly aging population, a lot of need for technology, a lot of need for innovation, budget issues–it would seem to me to be a really fertile market for the kind of things American companies can do.
WALKER: You’re actually right. I grew up in japan, so I’ve been watching Japan for over thirty years now, and the thing about Japan is they’ve never had a situation where they’ve had a leader for five years in a row: it’s political stability we haven’t seen. There’s a real optimism in Japan, and there’s a real interest in investing. Their number one investment is the United States, and so as result, for American businesses, there’s probably no better partner in the world right now than the Japanese, who have a lot of cash sitting in their banking system, that would like to invest in something. So if you have a great idea, and you want to pitch somebody on it, the Japanese have never been a more fertile area. The only caveat, I would say, is the Japanese not like other peoples in the world. They really value longevity and relationships. You can’t just walk up and show up with a great idea. You have to have an introduction, have the right set of connections. That’s something I’ve been working on more closely with people in this community, trying to help them figure out how to unlock that international potential.
ABERMAN: That makes sense to me. My first job as an economist was working for a Japanese a company, so you’re spot on. If you ask somebody who you don’t know well in Japan for a direct answer, you won’t get one, and in fact, you’ll offend them.
WALKER: You’re exactly right.
ABERMAN: But that’s great point, because you’ve been in diplomacy. Americans, we go overseas, many of us just assume everybody’s like us, which is the biggest mistake you can make, isn’t it?
WALKER: You’re one hundred percent right. Whether you’re in Asia, where you have to really value longevity and kind of–well, in the U.S., we just think, well, I have the best idea, it doesn’t matter how present myself. I may look young, I may not have the gray hair somebody else has. In Asia, you have to have that gray hair. You’ve got to have that experience, and so I think, there’s a lot we can learn from each other. And if you try to go in and assume everybody else has the same set of understandings you do, you’re going to fall on your face. There are countries have been out there a lot longer and they’re a lot older than our entire country. This country’s only two-hundred-something years old. Japan, you know, we’re talking about three millennia. I mean it’s kind of insane how old they are, and how new Americans are to the political scene.
ABERMAN: Perspective is important, there’s no doubt about that. You can’t just make it up. Are there other countries, other than Japan, that you see specific opportunities for American businesses right now?
WALKER: I think Germany’s a great place to look. You know read the headlines, all you see is about the politics and Angela Merkel, will she survive? The German economy’s roaring. It’s never been more of a kind of a European powerhouse house than right now. There’s a lot of bad things that you can say about the European Union, in terms of regulation and all that, but actually Germany is becoming this major hub, not just for kind of financial services and also kind of the tech side of things, but there’s an interest from the German side in its longevity and history with the United States, so I’d look at Germany. Obviously when I look at kind of the Middle East, It’s very dangerous to invest the Middle East right now because of all the political hotspots that are going on. But there are some kind–of you have to look at things at more of a granular level. So Turkey, for example, that I work on a lot, is a dangerous place. You hear a lot about terrorist attacks. Istanbul has never been kind of a better place for entrepreneurs to kind of launch things. Beirut and Lebanon, even though the country as a whole is kind of in a dangerous position, there’s these individual micro-markets that we see. It’s kind of looking beyond those headlines and being able to figure out where you think those trends are going to be heading.
ABERMAN: Are these markets where you go in to offer to sell something into the market or are these places where you go to sell expertise, so they can export out of the market?
WALKER: Both, actually. The ideal for a person in this areas is, how do I figure out both sides of that? Because if it’s just my goods being sold to a particular country, right, it’s just exporting from here to there, there are a lot bigger markets out there, whether it’s the Chinese or the Indian markets, et cetera. But when you’re looking at ways in which I can both bring some type of expertise and commodity and really kind of have a good return of my investment, but then also, I can then in turn help that market. There are a lot of government incentives that are out there for international markets, and there’s also a lot of major international conglomerate that like the prestige of being associated with a successful American venture. So, the Japanese pay top dollar for that, as you well know, but there are other countries that are beginning to look at that and say, well, we’d love to get a base in the U.S., so we’ll work with you and if you can help us, we’ll use that as our base.
ABERMAN: It would seem to me, then, that the United States and particularly Washington D.C. and this region, this could be a tremendous opportunity for us, because it’s a name brand. It’s a place where things happen. Do you find that when you go off and you market, and should companies here be more aware of international opportunities as a result?
WALKER: You’re absolutely right. I mean, one of the challenge I think D.C. has is everybody knows about D.C. and everybody sees what happens in D.C.. A lot of international investors don’t really consider D.C. because they think, immediately, the financial hub in New York or they think about the Californias, they think about the Texases. They hear a lot about these big markets. D.C., because we’re divided between the District and between Virginia and Maryland, oftentimes we don’t have the coherent support that we need that, a place like Texas or California has. They have entire offices that basically are ambassadors for those states. We don’t have that similar prospecting in this area, and I think entrepreneurs have not really been given the signal that this is where you can really do things right. When I talked to a lot of international clients, they’re very interested in what’s going on in D.C., they would love to have one foot based out of D.C., and while their international operations may be from their headquarters in their home country, they do have their global headquarters. A lot of the global officers of Japanese companies are based out of New York and they’re actually moving to D.C., because they say, you know what? We might as well be right here where we can keep our finger on the pulse of what’s going, Geopolitical risk is growing, therefore, I think D.C. is becoming a bigger, bigger hub for those types of things.
ABERMAN: Another example, my friends of how and why, invisibly, big things happen here that have nothing to do with government, and everything to do with Washington, D.C.. Joshua, thanks for joining us. That was great insight today.
WALKER: Thanks for having me.