Network AppalachiaNetwork Appalachia

Access to Access to Opportunity in Opportunity in

the Global the Global Economy of Economy of

the 21the 21stst CenturyCentury

Get Ready to RunGet Ready to RunEvery morning in Africa, a gazelle wakes up.Every morning in Africa, a gazelle wakes up.

It knows it must run faster than the lionIt knows it must run faster than the lion

or it will be killed.or it will be killed.

Every morning in Africa, a lion wakes up.Every morning in Africa, a lion wakes up.

It knows that it must outrun the gazelleIt knows that it must outrun the gazelle

or it will starve.or it will starve.

It doesn’t matter if you’re a gazelleIt doesn’t matter if you’re a gazelle

or a lion.or a lion.

When the sun comes up,When the sun comes up,

you’d better start running!you’d better start running!

Thomas L. FriedmanThomas L. Friedman

New Physical and New Physical and Economic Links Economic Links

Appalachian Development Appalachian Development Highway SystemHighway System

1.1. 3090 Mile System—13 states3090 Mile System—13 states2.2. 31 Individual Corridors31 Individual Corridors3.3. 85% Complete85% Complete

Emerging Global Supply Chain Emerging Global Supply Chain Inland Port LocationsInland Port Locations

Launching Network AppalachiaLaunching Network Appalachia

Net “A” Study Group Net “A” Study Group 1.1. TransportationTransportation

2.2. International Trade International Trade

3.3. Economic Economic Development Development

FHWA Funding SecuredFHWA Funding Secured

Consultant Selected Consultant Selected

Design Research & Planning Design Research & Planning ActivitiesActivities

Macro-Economic and Macro-Economic and Demographic Transitions Demographic Transitions

Economic TrendsEconomic Trends Global Real GDP (past 6 decades): Global Real GDP (past 6 decades): + 8 fold, + 3.8% annually + 8 fold, + 3.8% annually Global Trade Volume : Global Trade Volume : + 64 fold, +7.6% annually + 64 fold, +7.6% annually (Manufactured Goods) (Manufactured Goods) US Economy (International): 1950-3%, 2000-25%, 2050-50%US Economy (International): 1950-3%, 2000-25%, 2050-50%

Demographic TrendsDemographic Trends Population is shifting from North/Inland to South/CoastalPopulation is shifting from North/Inland to South/Coastal Population is agingPopulation is aging

• 2000 – 1 in 5 Americans are retirement age2000 – 1 in 5 Americans are retirement age• 2030 – 1 in 3 Americans are retirement age2030 – 1 in 3 Americans are retirement age

Demographics shifts affect: Demographics shifts affect: • Demand/consumption shifts from manufacturing to service sectorDemand/consumption shifts from manufacturing to service sector• Labor force shifts from manufacturing toward service sectorLabor force shifts from manufacturing toward service sector

U.S. Manufacturing Grows & Shifts U.S. Manufacturing Grows & Shifts Lower value/profit commodities seek low cost off-shore laborLower value/profit commodities seek low cost off-shore labor Higher value/profit commodities sustain a domestic presenceHigher value/profit commodities sustain a domestic presence

The Global Marketplace:The Global Marketplace:Looking ForwardLooking Forward

(% of World GDP)(% of World GDP)

EU 34%

Japan 12%

China 4%

India 2%

US 28%

Other 20%

EU 15%

Japan 4%

China 28%

India 17%

US 26%

Other 10%

2004 2050

Intermodal GlobalIntermodal Global Supply Chain Supply Chain

Global Commodity Flows Increase & DiversifyGlobal Commodity Flows Increase & Diversify Domestic Flows (2000-2020): Domestic Flows (2000-2020): +2/3 +2/3 International Flows (2000-2020): International Flows (2000-2020): Double Double Latin/South America Flows (2000-2020): TripleLatin/South America Flows (2000-2020): Triple Average Distance/Shipment:Average Distance/Shipment:

• 1993 – 420 miles1993 – 420 miles• 2003 – 590 miles (+ 40%)2003 – 590 miles (+ 40%)

Intermodal: 21Intermodal: 21stst Century Mode of Choice Century Mode of Choice World container ports: 1970 - 75 ports, 2005 – 550 portsWorld container ports: 1970 - 75 ports, 2005 – 550 ports Volume of container throughput, US gateway ports:Volume of container throughput, US gateway ports:

1970 – 1 million1970 – 1 million 2000 – 20 million2000 – 20 million2020 – 50 million2020 – 50 million 2050 – 100 million2050 – 100 million

Global Trade Lanes EmergeGlobal Trade Lanes EmergeEast – West:East – West: US-North Asia, US-Europe/South Asia US-North Asia, US-Europe/South Asia

North – South: US- Latin/South AmericaNorth – South: US- Latin/South America

Engaging the RegionEngaging the Region

Five WorkshopsFive Workshops

500 Participants500 ParticipantsBusinessBusiness

CivicCivic

AcademicAcademic

OutputOutput Strategic PrioritiesStrategic Priorities

Tactical OpportunitiesTactical Opportunities

Network Appalachia FindingsNetwork Appalachia Findings Over past 6 decades, GDP +8 fold, trade +64 foldOver past 6 decades, GDP +8 fold, trade +64 fold Long-term economic expansion is underlying driver, plus:Long-term economic expansion is underlying driver, plus:

Containerized intermodal supply chainContainerized intermodal supply chain

Telecommunication/information technologyTelecommunication/information technology

Demographic shifts Demographic shifts

Market expansion & new trade agreementsMarket expansion & new trade agreements While annual trends vary, global economy is fully establishedWhile annual trends vary, global economy is fully established East-West trade lanes remain strong, North-South will growEast-West trade lanes remain strong, North-South will grow Global supply chain is intermodal by nature, ports are gatewaysGlobal supply chain is intermodal by nature, ports are gateways Access to supply chain is essential for competitiveness Access to supply chain is essential for competitiveness Enhanced intermodal coordination improves capacity, cost-Enhanced intermodal coordination improves capacity, cost-

efficiency, reliability, and addresses intensifying energy & efficiency, reliability, and addresses intensifying energy & environmental issues environmental issues

Network AppalachiaNetwork AppalachiaIntermodal Corridors of Commerce & Inland PortsIntermodal Corridors of Commerce & Inland Ports

Planning & Development Planning & Development FrameworkFramework

AdvocacyAdvocacyRegion must advocate for its own future through buildingRegion must advocate for its own future through building

innovative & collaborative new partnerships. innovative & collaborative new partnerships.

PlanningPlanningEncourage & support expanded planning & developmentEncourage & support expanded planning & development

Multi-modal Multi-modal Highway, Rail, & Maritime Highway, Rail, & Maritime

Multi-disciplinaryMulti-disciplinary Transport, Econ. Dev., & Global Trade Transport, Econ. Dev., & Global Trade

Multi-jurisdictionalMulti-jurisdictional Local, State, National, & Global Local, State, National, & Global

Multi-sector Multi-sector Public/Private CoordinationPublic/Private Coordination

InvestmentInvestmentBuild on momentum of new public/private investment modelsBuild on momentum of new public/private investment models

Network Appalachia Network Appalachia