- The Washington Times - Thursday, July 6, 2000

The Fairfax Economic Development Authority will open an office in Frankfurt, Germany, on August 15 in an effort to attract investment from Europe's largest economy.

The move is a sign that development officials know the United States is heavily dependent on foreign investment even in the best of times to keep its economy humming.

Despite its size, Germany is not heavily represented among investors in the area. There are 29 British firms in Fairfax county, Va., but only 11 German ones. So county officials believe Germany is rich with opportunities to lure companies to the area.

"The interest from Germany has not been overwhelming, but we saw enough to take this step," said Gerald Gordon, president of the Fairfax EDA.

The Frankfurt office is the third overseas outpost that Fairfax county has set up. Efforts to promote the region outside North America began in Tokyo three years ago and extended to London in 1999.

"We found a lot of companies who want to use Fairfax County as a jumping-off point for the U.S. market," said Mr. Gordon.

The establishment of offices abroad puts Fairfax County in a league with other forward-thinking municipalities throughout the country that have recognized the importance of international trade and investment in local economies.

"More progressive, urbanized counties are doing this all the time," said Jacqueline Byers, director of research at the National Association of Counties. "It's a global economy out there."

Fairfax County's overseas offices stress different aspects of the local economy. British companies, Mr. Gordon said, often lacked start-up money, so the county promoted the range of venture capital companies in the area. Germany is awash in venture capital, so the Frankfurt office, which will be staffed by people with local contacts, is likely to highlight telecommunications and biotechnology as two major areas that might be attractive to German investors.

Another selling point specific to Germany is the plethora of direct connections between Frankfurt, the country's business center, and the Washington area. United Airlines, Mr. Gordon pointed out, has hubs in Frankfurt and at Washington Dulles International Airport.

Among the German companies already in the area are a few recognizable names, and a number of lesser-known technology companies. Siemens Information and Communications Networks Inc. in Vienna develops telecommunications systems and equipment, and the German military has its administrative control center in Reston.

But Fairfax County is also home to smaller firms like Orbis America Inc., a software developer, and Noell Crane & Services Inc., an environmental engineering company.

Though most economists credit better use of information technology for the long-running boom in the United States, another factor is clearly the capital that foreign firms are pumping into the economy. In 1999, the United States was the top destination for foreign direct investment, which totaled $282.5 billion last year.

"Along with a booming stock market and strong productivity growth, increased international investment is clearly a factor in the remarkable performance of the U.S. economy," said Todd Malan, executive director of the Organization for International Investment, an association that represents U.S. subsidiaries of companies headquartered abroad.

Since Americans save very little of their disposable income, capital from overseas is essential to maintaining Americans' standard of living, Mr. Malan pointed out.

European companies are the top investors in Virginia, according to the European-American Business Council. Of the $20.2 billion that international firms have put into Virginia, 61 percent has come from Europe, the council said.

Maryland, with $10.6 billion invested from outside the United States, has benefited from the American relationship with Europe to a similar degree. Europeans account for 66 percent of that total.

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