A note from Nikia: WTCSD on trade

Navigating trade uncertainty in a binational region

As tariff threats loom and the country teeters on the brink of an all-out trade war, we all wonder what it means for our binational region, the future of the popular USMCA, and the hundreds of thousands of jobs tied to global commerce in San Diego.

This will be a volatile period for the North American supply chains that enable this region to compete globally. We have been here before.

In all the economic development work we do in this region, we strive to do it binationally, as a metropolitan region of close to seven million bisected by an international border. We travel together on investment attraction missions to South Korea or Singapore; we advocate together in Washington, D.C. and Mexico City for better infrastructure; and we work every day with counterparts in Tijuana to help companies create deep and resilient binational supply chains in critical industries.

What we have learned is that in the midst of uncertainty, we should return to what we know to be true about this binational region:

  • We know that our border economy, anchored by the busiest port of entry in the Western Hemisphere, has been a tremendous driver of economic growth, job creation, and competitiveness—not just for San Diego, but for America as a whole.
  • We know that what we do here is not trade, it is co-production: a single component—in an automobile or a medical device—may cross the border six to eight times, with value added at each stop, before finally reaching its customer. This means that 40 percent of what we import from Mexico was made by American workers in the first place. For imports from China by contrast, that number is less than four percent.
  • We know that this ability to regionally produce goods is a compelling reason why foreign companies invest here, and why local companies can compete globally and export their goods and technologies around the world, creating hundreds of thousands of jobs in this region alone.
  • And we also know how critical these supply chains—in aerospace, electronics, semiconductors, and medical devices—are to the broader U.S. economy. Notably, 60 percent of all medical devices imported to treat patients in hospitals in Boston and Atlanta are produced in this region and cross this border every day.
  • Finally, we know how important long-term investments in infrastructure—like Otay Mesa East or the Cross Border Xpress terminal—are to enhancing the remarkable economic engine we have created in this region.

Here in San Diego we have been finding solutions for decades, by working collaboratively to build border infrastructure, to facilitate trade and immigration, to fight crime and enhance education, and to create better outcomes for businesses, for consumers, and for communities.

The coming weeks and months will be bumpy—as barriers to trade and market access rise around the world—and they will be especially difficult for the 98 percent of U.S. exporters that are small businesses. Yet despite this turbulence, the overall calculus for American policy makers and global business leaders has been consistent for well over a decade: Regionalize supply chains closer to the customers they serve, and rebuild U.S. manufacturing capabilities in industries critical to national security and competitiveness. And there is no way to achieve those goals without relying on our North American neighbors. Even in the most extreme tariff scenarios, trade with Mexico and Canada would likely increase, but businesses and consumers would pay higher prices for the pleasure.

Our job in this moment is to be agile and creative in helping firms of every size—who have played by the rules and made significant investments in this country and its neighbors—to navigate uncertainty, continue to reach their customers and suppliers, and maintain jobs and supply chains in our most critical industries.

Nikia Clarke
Nikia Clarke

Chief Strategy Officer, EDC; Exec. Director, WTCSD


Resources and action:

  • Understand San Diego’s Foreign Trade Zones (FTZ) Program, which allows for duty free imports and warehousing. Learn more
  • Apply by June 30 to WTCSD’s MetroConnect export accelerator program supporting small- and medium-sized businesses in going global
  • Stay tuned for WTCSD’s upcoming Binational Trade & Competitiveness Report, launching Q3 2025

Need support? Contact our team.

EDC and WTCSD work directly with companies—free of charge—to help them grow in San Diego.

Contact us

Small, localized commitments mean huge economic impacts in San Diego

Op-ed originally published by San Diego Business Journal

Authored by Eduardo Velasquez, Sr. Research & Economic Development Director at San Diego Regional EDC, and Jennie Brooks, EDC Board Chair and Executive Vice President at Booz Allen Hamilton

Hosted in San Diego last month, the Department of the Navy Gold Coast Small Business Exposition brings together hundreds of government and defense contracting leaders to talk all things DOD procurement. Self-proclaimed as the big business event for small businesses, Navy Gold Coast serves to ‘leverage small business capabilities to seize opportunities for strengthening national security.’

Boasting the largest concentration of military assets in the world, San Diego has an incredible and important opportunity to tap our region’s small businesses not only to support military interests, but also to drive inclusive economic growth across the region.

As we track toward our region’s 2030 Inclusive Growth goals, it is imperative that our economic development strategies prioritize small businesses, which represent more than 98 percent of all local businesses and employ 59 percent of San Diego’s workforce. They are not just contributors to the local economy; they support jobs for 807,540 San Diegans across industries. But they are challenged to remain competitive. Small businesses pay on average 38 percent less than their large business counterparts, and in 2023, under one-third (or 244,794) of small business jobs were considered quality jobs—those paying $46,846 plus healthcare benefits. Not to mention the challenge small businesses face in succession planning, accessing capital, and generally staying afloat in one of the most costly regions in the country.

Together, San Diego’s large employers can have enormous impacts on our region’s small business community. In fact, a 2021 EDC study found that anchor institutions—such as universities and hospitals, as well as utilities, local government, and even sports teams—that are physically bound to the region collectively purchase tens of billions of dollars in goods and services every year. Yet, it is estimated that local anchors spend about one-quarter of all procurement dollars on suppliers from outside the region, with a fraction going to small and minority-owned businesses. EDC found that if anchors shifted just one percent to local, small, or diverse suppliers, San Diego would see millions of dollars in economic impact and thousands of jobs.

Booz Allen Hamilton has been committed to partnering with small and diverse suppliers across the San Diego region. In 2023, the firm’s local spend in the San Diego area with small businesses was more than $50 million, a 24 percent increase from 2022. We’re also inspired by San Diego Gas & Electric, the County of San Diego, and others making measured and meaningful commitments to support our region’s small and diverse businesses.

So, what can you do? To maximize their collective economic development impact, we need three key things from the region’s anchors.

First, we need consistency and coordination, both in terms of definitions and processes, to increase accessibility. Every institution tracks its spending differently, and each has its own requirements and processes for bidding out contracts. A consistent set of definitions and even some coordination in bidding processes will not only facilitate tracking and collective goal setting, but also increase access to a new pool of potential vendors and suppliers.

Second, leadership and resourcing are needed to establish and meet procurement goals. It is important that both organizational leadership and procurement staff agree on the value of these goals, thus creating accountability, aligning incentives, and implementing change.

Last, anchors leverage their large prime contractors to meet procurement goals. Take construction for example: large projects are often sub-contracted out by prime contractors to smaller suppliers and vendors, and many anchors lack visibility into these sub-contractors. Engaging primes in anchors’ goal setting increases visibility and opportunity for smaller suppliers while also ensuring that prime contractors have the capacity to fulfill project deliverables.

With intentional and localized commitments, we can create an economy that benefits more San Diegans, grows more jobs, and helps small businesses become the Qualcomms, Dexcoms, and Booz Allen Hamiltons of the future.

Let Navy Gold Coast serve as a potent and timely reminder to prioritize small businesses and inclusion for the betterment of our economy.

To learn more and get involved, contact:

Eduardo Velasquez
Eduardo Velasquez

Sr. Director, Research & Economic Development

National Volunteer Week: Why EDC volunteers

Here at EDC, we thrive on making a difference – in the office and after work. Whether helping children or addressing food insecurity, here are just a few of the ways EDC staff volunteer to make the world a better place.

Jordan Latchford, Court Appointed Special Advocate (CASA) at Voices for Children

  • What I do: As a CASA volunteer, I am officially appointed by a Juvenile Court judge, to become involved in the case of a child that has been abused, abandoned, or neglected. As the Juvenile Court’s eyes and ears for children in foster care, I speak up on my child’s behalf and help them through what is often a confusing and scary time.
  • Why I volunteervolunteer with Voices for Children because I think everyone needs someone to look out for them. I’m often the only permanent person in their life, and connecting with the children is the most rewarding experience.

Katelyn McCauley, CASA at Voices for Children

  • Why I volunteer: volunteer with Voices for Children because I was once a child without a voice, and it’s my honor to pay forward the opportunities afforded to me through the mentors and advocates I’ve had throughout my life. I can find no better investment of my love, empathy, and time than providing a voice that focuses solely on the needs of a child navigating a complex legal system to no fault of their own.

Lauree Sahba, Member, Board of Directors at Voices for Children

  • Why I volunteer: Foster kids are in dire circumstances through no fault of their own and I feel a deep sense of responsibility to help. Raising awareness and money for Voices has been my passion for nearly 20 years. Voices recruits, trains, and supports CASA volunteers who speak up for the needs and well-being of foster children. One caring adult can change their lives by finding a safe permanent home through reunification or adoption. I’m so grateful to my colleagues for becoming CASAs, caring for children and helping judges make more informed decisions about their futures.

EDC Team, Volunteers at Padres Pedal the Cause

  • What we do: In addition to Padres Pedal’s annual fundraising event, Team EDC participated in Groceries4Good last year, delivering groceries to patients and families going through cancer treatment.
  • Why we volunteer: Whether in honor of family members with cancer or because we want to make our region a kinder, healthier place, the EDC team believes in Padres Pedal’s mission to accelerate the cure for cancer by funding research and clinical trials.
  • Check out a video recap of our day in the life of volunteering for Groceries4Good and Padres Pedal:

 

Love making a difference in the San Diego region? We’re hiring! Check out open roles here.