Connectivity is required in order for globalization to work. Connectivity is driven by telecommunications, information technology, and transportation of goods and people. In today's new global economy, aviation is at the forefront: Air cargo accounts for 42 percent of the value of today's world trade but only 2 percent by weight. The Boeing Forecast places world air cargo growth for the 20-year outlook period at 6.2 percent and passenger growth at 5.2 percent annually for the same period, while world GDP is forecast to grow at 3 percent.
Obvious aviation activities connected to globalization are persons traveling for business on a commercial flight from Chicago O'Hare to London Heathrow or a corporate jet transporting business executives from Teterboro to Frankfurt. There are, however, other activities that take place in aviation that are less conspicuously connected to globalization. A few examples:
-An MNC such as Honda may invest in a manufacturing facility in your community through FDI. Honda executives then travel to your community via corporate jets both during and after construction. In Ohio, FDI comprised 11 percent of private investment for capital projects in 2003, up from 8 percent in 2002 and 2001.
-In Cozad, NE, an agricultural sprayer applies pesticide to wheat crops which, in turn, is sold to consumers in Japan. The latter ranks second in U.S. wheat exports -- some 3.1 million metric tons in 2004. Apples and other produce grown in Washington State are commonly shipped to Japan by air.
-In King Salmon, AK, a Lockheed Hercules L-100 departs for Tokyo with containers of sockeye salmon and salmon roe (eggs) during the summer fishing season. Some 98 percent of Alaska salmon roe is exported and most of that (87 percent) goes to Japan.
-Helicopters shuttle bank checks between the finance district in Lower Manhattan and Europe to inbound and outbound aircraft. Helicopters are the necessary mode of transport for these checks, many of which are in the amounts of millions of dollars, to minimize each minute of accrued interest.
-Air cargo companies are increasingly being used for supply chain management by manufacturers. Dell Computer in Austin has disk drives manufactured in Malaysia and transported via air cargo aircraft to the final assembly plant in Round Rock, TX -- meeting Dell's just-in-time schedule.
-The Ohio Department of Devel-opment maintains that Cincinnati has business location advantages because of the Cincinnati/Northern Kentucky International's direct international flights. In fact, over 200 companies located in the Cincinnati/Northern Kentucky region are owned by foreign firms from Japan, Western Europe, the U.K., and Canada.
-A study by the Atlanta Chamber of Commerce, which surveyed 264 foreign-based establishments, found that availability of direct international flights was the third most important factor in location decisions by these firms.
-In the fall of 2004, Delta Air Lines applied to the U.S. DOT for rights to begin daily Atlanta-Beijing service in 2006. China is the fastest growing economy in the world and airlines and cargo carriers are competing for over 100 new airline routes between the US and China. Delta enlisted its largest business customers to lobby the U.S. DOT for the route, including Coca-Cola, GE Energy, Equifax Inc., and Cox Enterprises Inc. The annual economic impact of the route on Atlanta's region is estimated at over $400 million.
-In a report by USA BIAS (United States Airports for Better International Air Service) it was noted that New Economy employers have a 50 percent higher demand for air travel than traditional industries. Consequently, they seek locations close to airports and, as a result, cities are forming around airports just as cities formed around seaports in the 18th century.
-In January, the U.S. and India reached an open skies aviation bilateral agreement that will lead to more flights, lower fares, and stronger economic ties between the two countries. Trade between the two nations totaled $18 billion in 2003, a 13.5 percent increase from the previous year.