Second, the business climate. In countries like the United States, a complex environment of regulations and tax provisions determines if and where companies scale up and invest. Too often, these regulations add costs and, worse, uncertainty to these calculations.Forward-thinking countries are seeding the ground for manufacturing growth by shifting to smarter regulation. Through competitive tax rates, streamlined permitting processes and other reforms, these countries enable government to operate at the speed of business, increasing predictability for companies that are looking to invest.
Third, a smart, balanced energy policy. Manufacturers gravitate toward regions where energy is affordable and accessible – not merely because we consume energy, but also because we create so much more with it. We use natural gas, for example,as a feedstock – as the building block that transforms our innovations from ideas into reality.
More than 95 percent of the world's synthetic materials would not be possible without our industry: from pharmaceuticals to smartphones to lighter, more efficient vehicles. When natural gas is used in the manufacturing process instead of burned or exported, it generates eight times more value across the economy.
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In this way, advanced manufacturing expands economies when they are healthy and helps them recover when they are not. It creates competitiveness in a way no other sector can – encouraging countries to invest in their work forces, laying the groundwork for further innovation, and making far better use of natural resources.
But again, this virtuous cycle cannot set itself in motion. If we create an ecosystem in which innovators can work together – at the intersections between business, government, academia, and civil society – then the current manufacturing renaissance can become a revolution. Far from the so-called demise of manufacturing, we will instead see the rise of a new era of investment, innovation, job creation, and prosperity that will improve lives around the world.
Andrew Liveris is Chairman and CEO of Dow.