Foreign firms create jobs, invest $25 billion in Colorado

Gargi Chakrabarty

Published August 22, 2008 at 9:05 p.m.

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Jack Dempsey / The AP

At the Vestas wind-blade factory in Windsor, a huge blade dominates the floor on opening day in March. The wind-blade factory employs 650 people.

Photo by Associated Press / File

A wind turbine blade is displayed during the opening of the Vestas blade factory in Windsor in March. The company plans to open another plant in Brighton, employing 1,350 workers.

One of every 25 private industry jobs in Colorado is with companies headquartered in other countries.

They employ nearly 76,000 Coloradans. They own factories, land and equipment in the state worth about $25 billion, almost double from five years ago.

And that's likely an understatement.

The most recent data, compiled from U.S. Department of Commerce information collected in 2006, doesn't reflect projects announced in recent months by Danish, Spanish, Australian, German and Canadian companies that will create thousands more jobs.

"Vestas alone caused it to grow substantially," said Don Elliman, who heads the state Office of Economic Development and International Trade.

Danish company Vestas Wind Systems said last week it will build a $290 million wind- turbine complex in Brighton, employing 1,350 workers. On Friday, it picked Pueblo as the site of a factory to build towers that support its wind turbines, the biggest such plant in the world.

Coupled with its existing operations in Windsor, Vestas will spend $680 million and employ 2,450 in Colorado by about 2010.

"It's the way the world is going," Elliman said. "Multinational companies controlled from wherever are a big part of this nation's economy and most other nations' economies."

Last month Elliman accompanied Gov. Bill Ritter on a five-day trip to Madrid, Spain, ostensibly to woo the Spaniards and their euros. What caught their attention was the $7 billion to $10 billion that Spanish companies plan to spend in renewable-energy markets in the U.S. in coming years.

Foreign investment

This apparent bonhomie is a far cry from the 1980s, when Gov. Richard Lamm decried foreign investment after Japanese companies bought up high- tech companies and locked down thousands of patents.

"I do not want the Japanese coming in and buying up American technology," Lamm was quoted as saying in a New York Times article. "I do not want them in our state. I don't want the Arabs owning our banks or the Japanese owning our means of production."

Even today, some question the impact of growing foreign investment on the long-term health of Colorado's economy.

Howard Arnold, a business representative of the United Association of Pipefitters Union Local 208, said foreign investment is a double-edged sword: union laborers like to build new projects for the foreign-controlled companies but wish all the profits stayed here.

"Foreign companies are looking at us and seeing a big market with low cost, thanks to a weak dollar, so it makes sense for them to put up a manufacturing facility here," Arnold said. "But I'd rather see an American company building or modernizing a manufacturing facility here, strengthening our country and our middle class."

State well-positioned

Colorado's pool of highly educated labor always has been a big draw among affiliates of foreign companies. Having 11 national labs in the area also improves the state's appeal among overseas investors eager to benefit from research as they try to keep pace with technological advances.

On a macro level, a weakening dollar makes it cheaper to invest in this country.

Closer to home, the state is helped by Ritter's aggressive courting of foreign companies to push his energy economy based on solar and wind power and biofuels.

On the flip side, Colorado doesn't have a port, is perched in the mountainous West, which makes logistics a challenge, and imposes higher taxes on manufacturing equipment, factors that don't seem to bother foreign investors.

"Colorado's whole orientation toward a new-energy economy with high-value jobs growth is farsighted and exactly the way we would want the state to be positioning itself," said Chris Waggett, president of US Lend Lease Communities headquartered in Denver. "It plays to our sophisticated approach to property development."

Assorted industries

Lend Lease Communities, a subsidiary of Lend Lease of New South Wales, Australia, is developing more than $1 billion of real estate in metro Denver. Its 3,800-acre project in the former Lowry Bombing and Gunnery range in Arapahoe County aims to use solar power to support 13,000 homes, seven elementary schools and one high school along with commercial properties.

Other foreign affiliates making inroads in Colorado include Brisa Auto-Estradas of Portugal and Companhia de Concessões Rodoviarias of Brazil, which will jointly operate the Northwest Parkway that links the E-470 toll road with U.S. 36.

Cemex of Monterrey, Mexico, runs a cement plant near Lyons, while a new $300 million cement plant near Pueblo built by Grupo Cementos de Chihuahua of Mexico recently began limited operations.

Mining company Rio Tinto, with main offices in London and Melbourne, Australia, has moved the headquarters of its minerals division to metro Denver, bringing roughly 200 jobs.

Siemens Energy, an arm of German engineering giant Siemens, will set up its U.S. wind turbine research center in Boulder and employ 50.

Denver already has strong business links with the company: The Regional Transportation District recently signed a $184 million contract with Siemens Transportation Systems for 55 new light rail cars. They will be used on the multi-billion-dollar FasTracks project, which voters approved in 2004 and which was slated to be completed in 2016.

Abengoa, a Spanish energy company based in Seville, has short-listed Colorado for its glass-manufacturing facility for solar panels.

Officially, the United States has an open-door policy toward foreign investment except in areas related to national security.

Arnold maintains Ritter could lure American companies to push his renewable-energy vision.

For instance, American energy giant ConocoPhillips is developing a 432-acre campus in Louisville for its Global Technology Center and Corporate Learning Center, which could employ more than 7,000 people. The campus will be home to research and development of new-energy technologies and serve as the worldwide training center for employees.

"We look forward to ConocoPhillips coming here," Arnold said. "Our manufacturing is eroding. If there's an emergency or a war and we need to manufacture things quickly, we don't have it. We'd like American companies to invest here rather than in Mexico or Malaysia."

Wooing the Spaniards

Forget Puerta de Alcala.

Elliman said he didn't get to see much in Madrid other than his hotel and various conference rooms, let alone the Alcala Gate, the city's most popular tourist destination.

Accompanying Ritter to the Spanish capital, Elliman said the group landed at 3 p.m. Monday, July 7, and left at 4 a.m. Thursday - packing their time visiting 10 Spanish companies, meeting executives, attending dinners and getting to sleep late.

"We literally never stopped," Elliman recalled. "The Spanish like to meet for longer meetings, but the meetings were fascinating - there was a lot to talk about."

Spanish executives will visit Denver this week to network as the Democratic National Convention gets under way. It's their second visit in six months. Several of them have set up meetings with Elliman's office.

"I would be very disappointed if we didn't end up with significant investment with at least three to five of the companies," he said. "Those negotiations will take place over the next 12 to 14 months."

Northern neighbors

Ritter may be looking to the Europeans for renewable-energy investments, but Canada and its focus on the oil and gas sector top the list of foreign investment in Colorado.

"Colorado and Canada benefit tremendously from a strong and growing trade partnership. Last year it totaled $4.6 billion," said Dale Eisler, consul general of Canada in Denver. "Indeed, Canada is Colorado's largest export market, and 124,000 Colorado jobs are dependent on trade with Canada."

There are no data that track direct investment by Canada in Colorado, but consider this:

* Calgary, Alberta-based EnCana, which has its U.S. headquarters in Denver, is among the top producers of natural gas in Colorado, employing 1,200 full-time employees and roughly 1,000 contractors. Each year the company spends hundreds of millions of dollars to explore and drill gas in the Rockies, operating more than 3,500 oil and gas wells in the state.

* Suncor, also of Calgary, owns Colorado's two refineries in Commerce City, employing 486 and supplying about a third of the state's gasoline and diesel fuel demand. The company poured $450 million into the complex two years ago to upgrade the facilities to comply with tougher fuel standards.

* High-profile Canadian companies in Colorado include PCL Construction Services; Great- West Life, an insurance and finance company; Intrawest Corp., owner and developer of Copper Mountain and Winter Park ski resorts; and RBC Mortgage, which is owned by the Royal Bank of Canada.

"I find it interesting that people get upset about foreign investment," said Jim Reis of the World Trade Center in Denver. "If we look at our growth of population, our unemployment rate at 5.2 percent, we need investment to keep things going. If money is not available locally, what's wrong with foreign investment?"

chakrabartyg@RockyMoun tainNews.com or 303-954-2976

• August 23, 2008

  7:27 p.m.

  Suggest removal

  MichaelClark writes:

  In answer to the last question posed in the article, "...what's wrong with foreign investment?" there may be implications to it we are not fully aware of presently, and by the time those implications become manifest it may be too late to make any changes in the situation.

• August 24, 2008

  4:51 p.m.

  Suggest removal

  STOPUSAGiveaway writes:

  MORE PROPAGANDA by a foreigner: isn't that nice telling us dba the USA that it is great to be run by a foreign entity when we the people were once upon a time: self reliant and independent until foreigners aka ILLEGALs overran our nation stealing all.
  Keep YOUR PROPAGANDA: US citizens do not appreciate it that our forefathers built this nation so YO U could walk right in and dictate what is good for us...
  How have you contributed....?:
  How did you come to be in the USA?
  We are not doormats, nor slaves: yet so until my lst AMEND is silenced or basically it is when an outsider can tell me what is good for me a citizen of generations, whose family sacrificed for America while others just come and state "I am an AmericanJUST LIKE Y O U>..
  Never ............................................................................

• August 25, 2008

  3:27 a.m.

  Suggest removal

  windbourne writes:

  For those of you gripping, get over yourself. Our country has been ran into the ground by monster federal and trade deficits. Companies like AB have been selling themselves to foreign ownership. Ritter is currently seeking foreign companies. Fine. I just wish that he would spend money here on building small companies and current companies. For example, we had a nice aviation industry. That was hit hard over the last 2 years. Likewise, we have a small filming industry that could also use help. Finally, Ritter has pushed for LARGE foreign companies dealing in wind and solar PV coming here. But, solar PV will be awhile in coming, and has plenty of companies pursuing it. OTH, Solar thermal has the ability to be a monster industry. EU, esp. in spain, is spending large money on it. By encouraging the building of the plants here, it would make it easy to leverage that into geothermal. We have a number of drilling companies here. We need to take advantage of that and schools of mine/CU/CSU. Sadly, Ritter would rather build new social programs than dump that money into building companies here.

• August 26, 2008

  12:43 p.m.

  Suggest removal

  cassidy22 writes:

  STOPUSA - wow, you talk as if the United States is the birthplace of all humanity, and all others should bow to us.

  I don't recall Vestas (A Danish company) being full of illegals. They are giving jobs to Coloradans, who might have otherwise been unemployed. If you haven't noticed, there are a lot of folks going hungry these days.

  I also find your remarks rather ignorant and uneducated. Us "Americans" that you think are so hard working and ethical - came storming onto this land and kicked out all the folks who were living here. Ever seen the poverty on an Indian reservation? We destroyed a way of life to build "This Great Nation." Why do you feel threatened by foreign companies who come here and provide jobs AND renewable energy? Do you think the US doens't have companies and factories on foreign soil? Why is it OK for us to do it to others, but not for others to do it to us?

  (BTW - if you drive an "american" car, 80% of its components come from other countries. You can't draw a line that easily anymore, it's a global world, a global economy.)

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