Week of January 18, 2010
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C O M M E N T A R Y
Coming:
The Biggest Boom Ever!
A period of unprecedented global development lies just ahead. It will energize world economies and provide new hopes and opportunities for people of many nations. The great new era will start in the 2010-20 decade and build to a peak by 2050.

by McKINLEY CONWAY
editor bounce@conway.com
P
essimists cite our many problems and forecast gloom and doom for the world.
      They are wrong! Dead wrong! A systematic scrutiny of the factors at play tells us that the future will bring a host of positive experiences and exciting times.
      A key indicator — often overlooked — is the file of new plant reports that our company, Conway Data, has been compiling for more than 50 years.
      We started to collect reports of new plants in the 1950s, when the only measure of growth was government estimates of overall economic activity. There was a distinct difference, however, between what the government measured and what we reported. The government guessed at the size of forests. We counted trees.
      What we provided was a picture of the activities of the nation's fastest-growing firms — a small percentage of the total. We believed that this gave a more realistic view of things to come. Now, looking back on decades of reporting, we find that our reports revealed consistent growth — growth that continued despite wars, natural disasters, recessions and depressions.
McKinley Conway
Ohio Gov. Ted Strickland (right), accompanied by Lt. Gov. Lee Fisher (left), who leads the Ohio Department of Development, are pictured after they were awarded the 2009 Governor's Cup from Site Selection magazine.

      Our files show an impressive mix of thousands of new plants per year that are scattered geographically and diverse in type. We believe this is a measure of the true strength of our economic system and its future.
      During the recent recession, this strength has been confirmed by the records of the prestigious Industrial Asset Management Council. IAMC membership has continued to grow, and attendance at conferences has been high. The nation's top facility-planning executives are busy! A glance at this list of firms represented in IAMC is convincing proof of the significance of this activity:
      Abbott Laboratories, Air Products and Chemicals, Alcoa, Amgen, AstraZeneca, Avon Products, BASF, Black & Decker, Boeing, Bose, Bristol-Myers Squibb, Campbell Soup, Coca-Cola, ConAgra Foods, Cummins, Deere, Dell, Diebold, Dow Corning, DuPont, Federal Mogul, Frito-Lay, Genentech, General Electric, General Mills, GlaxoSmithKline, Hewlett Packard, Honda, Honeywell, Johnson & Johnson, Kellogg, Kimberly-Clark, Lennox, Lockheed Martin, Maersk, Merck, Michelin, Nestle, Northrop Grumman, Owens Corning, PepsiCo, Pfizer, Philips Electronics, Pitney Bowes, Siemens, Sonoco, Texas Industries, Unilever, U.S. Steel, Weyerhaeuser and Whirlpool.
      Another measure of interest is the annual tabulation we conduct to determine the winner of the Governor's Cup — which is awarded each year to the governor of the state landing the most new plants during the year. Published in the March 2009 issue of Site Selection, our final tally for 2008 showed Ohio to be the winner with 503 new plants and expansions. Texas, with 497 projects, came in second in the annual Governor's Cup race. Rounding out the rest of the top five states were Michigan, Pennsylvania and North Carolina, respectively. Note that the "Rust Belt" states ranked high in our count at the same time the national news media were reporting nothing but bad news about them.

Factors That Contribute to Growth
      In order to understand what is happening, it helps to examine closely the factors that relate to new economic and industrial growth. Future development is driven by a variety of basic human instincts such as need, desire, fear and competition — dynamics that have been evident since the beginning of recorded history. All of those factors are building up pressure right now:
McKinley Conway
The disastrous consequences of overpopulation were once woefully clear inside Hong Kong's walled city of Kowloon (pictured from the air). As Kowloon's growth ran rampant in the late 1970s, buildings were folded into one another, until finally the entire walled city became a monolith. Kowloon soon had one of Earth's highest population densities: 50,000 inhabitants jammed into only 6.4 acres (2.6 hectares). In 1984, Hong Kong's government resettled residents, leveling the walled city and building a park in place.
Photo: Hlekweni, http://www.quaker.org/hlekweni/about.html

      Need: Today we have an urgent and growing need for water, food, shelter, clothing and essential services for our fast-growing global population. From our present level of about seven billion souls, Earth's population is predicted to grow to eight billion by 2020, and nine billion by 2040. We have no effective world population management plan now, and there is none in sight.
      Desire: Thanks to the extension of TV coverage and worldwide Internet communication, those who live in the Third World are now well aware of what they are missing. They, too, want to rise above the poverty level. Rising expectations are a major force even in the wealthiest nations.
      Fear: Around the world, people are seriously concerned about their personal security. Terrorist attacks occur at random and often kill innocent, law-abiding citizens. There is the awesome threat of a devastating nuclear attack triggered by fanatics. Consequently, the pressure builds for defense mechanisms, ranging from standing armies to city surveillance cameras and home intrusion alarms.
      Competition: Better reporting of economic development activities and "scoreboards" showing the relative success of nations, provinces and local jurisdictions is intensifying basic competitive instincts. Political leaders at all levels are increasingly measured by their ability to place their constituents high on the charts for economic development success.
McKinley Conway
Producing 800 million gallons (3 billion liters) of water per day and generating 5,000 megawatts of power, the desalination plant in the city of Jubail on Saudi Arabia's Persian Gulf coast is the largest in the world.
Photo: Sasakura Engineering Co. Ltd.

New Industrial Growth
      Responding to such pressures, where will the world find the new industries to build tens of thousands of new productive facilities and create billions of new jobs? Fortunately, we already have a fix on many sources of potential new industrial activity:
      Water: Uppermost on mankind's list of necessities is water. In the years just ahead, the world will be forced to phase out the existing water supply system — an environmentally damaging practice based on robbing natural streams and pumping aquifers to extinction. The new system will rely on huge seawater desalting plants as sources. Potable water will be delivered to cities where every use will be metered and every user will pay. Selling water will become the world's biggest business.
      Science: The fast-expanding combination of academic incubators, science parks and venture capital firms will spin off a stream of new science and technology breakthroughs. The current wave of new ventures in biotech, nanotech and information sciences will be small in comparison. In the years ahead, discoveries will range from giving sight to the blind and curing cancer to linking computers directly to our brains.
      Energy: At last the world will recognize the futility of depending on fossil fuels and make firm commitments to alternative sources. This will trigger big new investments in nuclear, wind, solar, biomass, ocean current, wave action and geothermal power plants, as well as new systems yet to be developed.
      Transportation: The congestion and accident risks that are plaguing the present systems will be relieved by investments in new concepts and technologies. Interstate highways will be modernized by the addition of lanes in which individual autos and trucks are controlled by computers. In the cities, small robot vehicles like golf carts will pick up people in residential areas and take them to nearby supermarkets and/or medical offices — providing mobility for those who fear to drive and for the old and disabled. New travel frontiers will range from space tourism to human-powered flight around our neighborhoods.
McKinley Conway
Pictured is a drip-irrigation system at work at Hlekweni, a rural training center outside Bulawayo, Zimbabwe.
Photo: Hlekweni, http://www.quaker.org/hlekweni/about.html

      Conservation: The most important element of the world agenda for the upcoming decades will be the preservation and restoration of natural resources and environments. Every new development project will be viewed not as an unavoidable detriment, but as an opportunity to enhance the environment. Thus, there will be powerful support for constructive conservation projects such as the restoration of vast areas of tropical rain forest, denuded woodlands, dried-out savannahs, destroyed coral reefs, and damaged barrier islands and seashores. We will bring deserts back to life and find ways to put nuclear wastes to work safely.
      Agriculture: We will install drip irrigation schemes where agricultural interests now waste huge amounts of water. Vast tracts will be placed under plastic covers to extend growing seasons. In many areas, new techniques will permit adding a second crop each year. Research will lead to new crops that can be irrigated with salt water and others that resist freezing temperatures. We will meet the global need for food because we must.
      Democracy: Around the world, the political winds shift constantly. However, there is an underlying desire of all people to be self-governing. As global news media lend support, this movement will accelerate, giving rise to new democratic governments in areas where dictators and juntas have ruled. This in turn will lead to great new investments aimed at improving the quality of life for millions rather than providing luxury for a few despots. Lifting basket-case nations to productive status will boost the global economy.
McKinley ConwayMcKinley Conway
This geothermal power plant in Middletown, Calif., is one of 15 that Calpine Corp. runs in the Mayacamas Mountains north of San Francisco. The largest complex of geothermal power plants in the world, those 15 facilities collectively produce about 725 megawatts of electricity, enough to power 725,000 homes.
Photo: Calpine Corp.

'Mankind's Greatest Era'
      The decades ahead will be tumultuous. Of course, there will be some setbacks. There will be rude surprises such as tsunamis, tornados, volcanic eruptions and the tragic earthquakes that have just befallen Haiti. The world, however, is now capable of dealing with almost any disaster that does not occur instantly. Given lead time, the world can cope with even the worst-case scenarios being posed by pessimists.
      For example, if global melting begins to cause a dramatic rise in sea levels, global strategists will react quickly and expertly. Instead of rushing to build dikes and sea walls that do tremendous damage to coastal environments, wiser heads will prevail, and the world will hasten to build scores of big new seawater desalting plants. An array of plants around the world will withdraw great amounts of water from the oceans and maintain safe sea levels while providing new supplies of water to revive parched desert regions.
      Less spectacular but of equal importance, the world agenda will include building hundreds of new business parks containing tens of thousands of new plants, providing millions of new jobs, and supporting a better quality of life for billions of the world's citizens. The result will be the greatest era in the history of mankind.
McKinley Conway
Author McKinley Conway
Photo: Rebecca Conway
About the Author
    McKinley Conway's development history is voluminous and distinguished. Just a few of his milestones include founding Site Selection, the first-ever magazine focused on corporate real estate and economic development, and founding two industry associations that set the standard for the industry's professional development — the International Development Research Council (IDRC) and the Industrial Asset Management Council (IAMC).
      And there's much, much more. Conway created the industry's first development-focused Internet site, SiteNet, all the way back in 1983. And he founded Spruce Creek, the pioneering fly-in community near New Smyrna Beach. For even more on Conway's sizeable development-industry legacy, click here.


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