Diversification into biotechnology and other hi-tech industries is the key to future development
ucked
away on the Gulf coast just a short drive from Mexico, the city of Houston
is one of the world’s leading international business hubs with
an economy bigger than Hong Kong’s.
The maritime gateway to Texas has become such a cosmopolitan place that
at least one in three jobs there is tied to international trade, many
of them in the oil and gas sector. Houston is now ranked as the fourth-largest
metropolitan area in the US, with an ethnically diverse population of
around four million people.
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With
its strong energy profile – it is home to some of the US oil industry’s
most famous operators, such as Conoco and Enron – the city has
flourished in the past year or so on the back of high oil prices, although
these have dipped more recently. “We are to energy as New York
is to the financial markets,” says city mayor Lee Brown.
But this is only part of the story. Houston has diversified significantly
in recent years into a modern and dynamic centre that boasts one of
the most highly-skilled and educated workforces in the US, serving a
sophisticated commercial and industrial mix.
The
Texan spirit of entrepreneurship thrives. Evidence of success in new
economic areas is all around: the city is home to the headquarters of
computer giant Compaq, while global software giant BMC Software is also
based here, as well as around 200 other significant high-tech companies.
In all, 18 Fortune 500 companies are headquartered in the city, supported
by a flourishing services sector and extensive recreational facilities.
Among its other notable employers are the NASA space centre and one
of the world’s largest medical research centres.
A major draw for companies is the low cost of living
Houston’s
highly developed infrastructure of ports and airports provides a vital
link for these and other companies with the rest of the world.
The mayor believes Houston continues to be a choice location for business
and a great place to live and work. The cost of living is a lot cheaper
than other parts of the country – a major draw for companies, he
says, while its ethnic diversity is perhaps its greatest asset. “Houston
is a microcosm of what the United States might look like 20-25 years
from now,” he says. “What is interesting is that we celebrate
our diversity. It works as a strength and not as a problem.”
Mr
Brown wants the world to recognise Houston as a premier world-class
city, in business, as a place to live or visit, and even as a sporting
venue. The city is due to host the American football Super Bowl in 2004
and is in the running for the 2012 Olympics.
He concentrates his efforts on creating a better place for ordinary
people to live and work. This means safe neighbourhoods, good healthcare,
providing children with parks to play in and, of course, attracting
business opportunities to boost the local economy.
Mr Brown says the city is looking to diversify further, although he
admits that energy will always play a huge role in the local economy.
“We have the medical centre here, where all the research takes
place for example, but our research usually ends up being converted
to commercial products in another state,” he points out.
“Now
we are building our own biotechnology centre and the research will be
converted to commercial products right here in Houston. It’s very
logical. We have the research, the venture capital and everything it
takes. All we are lacking are the buildings, but we are building the
facilities right now.”
This ‘can do’ mentality is typical of the Houston commercial
culture, according to Mr Brown, and explains the city’s great success
in building successful businesses that span the globe.
Houston’s economic growth rate is now more than seven times that
of the US, according to the business group Greater Houston Partnership,
adding almost a quarter of a million jobs to the city in the past four
years. One of the latest firms to shift nearly 1,000 jobs to the city
is aerospace giant Boeing.
Economic growth is seven times higher than that of the US
Currently,
a major issue for the city authorities and its pioneering mayor is the
need to plan ahead for future growth. Houston expects its population
to expand by a further 1.6 million within the next two decades and,
while it already boasts one of the best infrastructures in the country,
it is looking to upgrade accordingly.
This will include a light railway system through the main street going
downtown to the Astrodome sports stadium, a commuter rail service, and
the expansion of the area’s freeways. The city has drawn up its
own capital improvements plan worth $4.3 billion between 2002-2004.
It will also mean major investments in the city’s airports and
ports.
According to Mr Brown, Houston is alive with opportunities for business
and is open to foreign visitors. For British tourists, the city offers
pretty much everything – restaurants, shops, sidewalk cafes –
with the notable exception of bad weather. “Whatever you want Houston
has it, except snow or cold weather,” the mayor adds.
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