Small Business, Big Opportunity: International trade presents exciting options for Alaska's small businesses.

Author:Salov, Alex

Alaska has a long history of international trade and there is a reason for that: the state is located within the transportation "crossroads" of the world. Due to its relative remoteness and isolation from the Lower 48, since the mid-20th century Alaska has been actively positioning itself as a part of the Pacific Rim. Late Governor Wally Hickel famously noted that "Alaska's political ties are with the United States, but our economic ties are with Asia. Our economy depends on exports." The Alaska timber industry was successfully selling to Japan in the 1950s; for several decades liquefied natural gas was exported to Japan and coal to Korea; and after the fall of the Soviet Union, Alaska companies were among the first to enter the Russian Far Eastern market. By the beginning of the 21st century, Alaska had international trade offices (similar to embassies) in five countries: Japan, South Korea, China, Taiwan, and Russia. Many of these fruitful developments have been phased out in recent years due to economic and political changes. For example, the State of Alaska no longer maintains the Office of International Trade or trade representatives overseas.

Alaska's Exports

What does Alaska's international trade look like? In 2018 Alaska's overall exports overseas accounted for more than $4.8 billion and when final figures for 2019 are compiled, they are likely to be even higher. Generally, Alaska exports raw commodities rather than value-added products, with some exceptions. Alaska's largest export commodity is seafood (more than 50 percent) followed by minerals and ores (more than 35 percent). The state's major export partners are China, South Korea, Japan, Canada, EU countries, and Australia. (Imports are harder to evaluate as the majority of foreign goods arrive in Alaska via domestic ports located in the Puget Sound region and are then considered Washington State imports.)

Some Alaska companies, such as engineering firms, also export their world-class expertise and services; however, since their services are intangible, their export values aren't documented in the same way. For example, international tourism is also considered an export of recreational goods and services, and according to the Alaska Travel Industry Association, more than 2 million people visit Alaska in one year, with approximately 15 percent of them being foreign tourists.

Alaska ranks 40th among all US states by the value of exported goods; however, on a per capita basis...

To continue reading