Global Trade Recovery Holds Promise for Georgia

April 29th, 2010 by Leave a Comment


By Mike Klein


Global trade has begun a steady recovery from worldwide recession that could last for several years, far outpacing anticipated U.S. annual GDP growth and providing an opportunity for Georgia to capitalize on the import-export economy.


Leading the global trade recovery are autos, metals, chemicals and commodities, Paul Bingham, director of IHS-Global Insight, told more than 800 guests at the 2010 Georgia Logistics Summit today (April 29) at the Cobb Galleria.


IHS-Global Insight, a global analytics firm that tracks worldwide economic trends, predicts the U.S. economy will see 3.0 percent real GDP growth this year and through 2012. Global trade is predicted to rebound 11.9 percent this year, and more than 7 percent each of the next two years. Trade with Asia leads the recovery and should for the next several years.


Many of the products associated with the recovery leaders move through Georgia’s Savannah and Brunswick ports, then out onto its highways and rail lines. Bingham said global trade would return to pre-recession levels within the year and continue to grow pending other international events that reverse positive trends.


Todd Long, director of planning for the state Department of Transportation, warned that Georgia is “at the top of a downward spiral” in terms of being able to develop and maintain highway infrastructure. Long made that point emphatically with a slide that noted, ‘’AT CURRENT INVESTMENT TRANSPORTATION LEVELS: GEORGIA’S OUTLOOK IS GRIM.”


Most conference attendees were from within the private sector and for many, it was the first time they had heard the state’s new transportation funding model discussed in detail.


Georgia receives high grades for the quality of its major highways, but the state has insufficient east-to-west and north-to-south major highways for freight purposes. Atlanta is congested to a great degree because freight has no option other than driving through the metro region. Trucks carry 85 percent of all Georgia land-based freight; Long said the goal is to move more freight by rail.


Georgia relies on motor fuel sales taxes to fund highway improvements. The three-year recession means fewer miles are being driven, less fuel is being sold and less tax is being collected. Plus, new federal guidelines are forcing consumers into vehicles that go farther on less fuel.


Governor Sonny Perdue is expected to sign new legislation that will create a 1 percent transportation sales tax option to fund specific projects within twelve regions. Voters would need to approve the projects when they vote in 2012 elections, and there is no guarantee they will vote to hike taxes.


Asked what happens if voters reject local option transportation sales taxes, Long said, “We’ll have to live with what we have. That may happen. We know that.” 


But he added: “There are provisions in the bill where we could put it back. If it passes in one region, and it’s going great, but it doesn’t pass in another region, then we could put it back before the voters within two years.”


Thursday’s conference was presented by the Savannah-based Center of Innovation for Logistics, which receives funding from OneGeorgia Authority. It set the stage for next Monday’s Internet release of the “2010 Georgia Logistics Report: Fueling Georgia’s Logistics Competitiveness.” The report will provide extensive detail about the five primary factors that generate logistics success: policy, infrastructure, operations, technology and workforce. The report will be released at


Mike Klein is an editor with the Georgia Public Policy Foundation, an independent think tank that proposes practical, market-oriented approaches to public policy to improve the lives of Georgians. Nothing written here is to be construed as necessarily reflecting the views of the Foundation or as an attempt to aid or hinder the passage of any bill before the U.S. Congress or the Georgia Legislature.

© Georgia Public Policy Foundation (April 29, 2010). Permission to reprint in whole or in part is hereby granted, provided the author and his affiliations are cited.



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