The State : For L.A., World Cup Is More Than Soccer Games

As did the Olympics a decade ago, the World Cup represents far more than a $600-million short-term stimulus to the local economy. After five years of man-made and natural disasters, the games offer an opportunity to redefine the region in terms of its global, multiracial future.

The Los Angeles of 1984 was, in many ways, quite dependent on the rest of America, bulking up on Pentagon steroids and selling to a mostly domestic audience. By contrast, the primary markets of companies that represent Southern California’s future are European, East Asian, Latin American and African. It is fans from these regions who crowd the shops and restaurants of Pasadena’s Colorado Avenue. They and recent immigrants, with their passion for the game they call futbol , are the absolute key to restructuring California’s economy.

The World Cup, with a worldwide audience three times that of the Super Bowl, has catapulted Los Angeles to the center of the global community and has done so, for a change, in a positive way.

Tourism will probably be the first industry to benefit from the exposure. Even before the games, almost one in four visitors to the region were from abroad. Domestic tourism remains lackluster, but foreign tourists, despite a turndown from Japan, have surged, and most of them come from Central America, Mexico, Korea and the rest of non-Japanese Asia.

Dependency on these tourists is expected to grow markedly. By the year 2000, according to the L.A. Convention and Visitors Bureau, the number of foreign travelers to the United States will rise by 75% compared with a 9% expected growth rate for domestic travel.

But even more important, the foreigners and recent immigrants who live here, the key markets for the World Cup, may prove critical to reconstructing the region’s shattered self-confidence. In fact, at a time when much of the U.S. mainstream press has all but written off California, and particularly Southern California, European publications such as the Economist and the Financial Times have tended to be far more balanced, even upbeat, in their coverage.

Foreigners have also become good customers of the region’s goods and services. As our largest single U.S. customer, the Pentagon, has cut back spending by more than $20 billion a year, the regional economy has become increasingly reliant on its global trade connections for job creation and economic growth. Between 1988 and 1993, according to World Trade Center Assn., the value of international trade passing through the Los Angeles custom district expanded from $32 billion to more than $48 billion. Next year, Los Angeles’ trade-related economy, only two decades ago one-quarter that of New York’s, should be the nation’s leader. The trade boom has created as many as 320,000 jobs during the past five years.

To a large extent, this rapid growth reflects the reality that, despite widespread economic pessimism, Californians continue to produce goods and services demanded all over the world. During the past year, the Economist notes, exports of California’s key core industries--from high-tech industrial equipment to processed food--have been rapidly expanding even as their national rivals experienced an overall drop in sales.

In fact, virtually every growing sector of the regional economy, from high-tech equipment and business services to entertainment and agriculture, relies increasingly on international trade to sustain its growth. Fast-growing firms, such as Taylor-Dunn in Anaheim, which exports electric vehicles to Mexico and East Asia, or telecommunications manufacturer Pairgain Technologies in Cerritos, regard international sales as critical to expansion. Often, company executives report, California’s qualitative edge is better appreciated abroad than in the rest of country.

The Sunkist oranges and lemons from the groves of Ventura County and the San Joaquin Valley are widely considered the world’s best, but few end up in local supermarkets since Japanese and Asian consumers routinely buy virtually all the top-of-the-line crop.

The region’s qualitative edge is also evident in such related fields as food processing, which benefits by virtue of its access to the nation’s most adaptive agriculture; a well-developed machinery industry; the largest and best-positioned ports, and the most cutting-edge market for health-related and ethnic foods. Southern California, for example, is arguably the world’s single-largest exporter of Mexican food products, with one Southland firm, Casa Herrera, even selling its tortilla-making equipment to Mexico.

Similarly, California’s high-technology industries dominate U.S. exports, accounting for 27% of all electrical machinery and 20% of industrial-machinery sales abroad. Indeed, a large share of the leading producers of high-technology products--from computers to software, from biotechnology to engineering services--are based and most heavily concentrated in California.

In entertainment-related products, the domination is even more marked, with Hollywood commanding virtually every global market open to competition. By the year 2000, overseas sales could well be responsible for up to half the industry’s revenues.

But nothing better reflects the World Cup’s significance to Los Angeles than the immigrants and youngsters most intrigued by soccer. They make up the prime market for entrepreneurs like Morocco-reared Ben Amer, who runs Attack Sports, a firm that manufactures soccer shirts and other paraphernalia. Amer, who co-hosted the team from Cameroon, sees the immigrants and the under-12-year-olds in the suburbs as transforming Southern California into a new “soccer capital” for the United States.

Certainly, the region’s huge Latino population has been energized by the games. “It’s impossible to overestimate their impact,” says Jose Lozano, publisher of La Opinion, the nation’s largest Spanish-language paper. “It reflects the incredible importance Los Angeles has as an immigrant city.”

The World Cup, Lozano adds, helps to “reintegrate” newcomers into the civic culture. Even the generational split widely observed at the U.S.-Mexico exhibition game--parents supporting Mexico, kids rooting for the Americans--suggests that assimilation, with all its contradictions and problems, continues.

At the same time, the games have focused national attention on the growing economic clout of the Southland’s Latino community, whose domestic product now exceeds that of most major U.S. metropolitan areas. Boosted by new national clients, advertising revenues at La Opinion, for example, have grown by double digits, compared with last year’s.

With the U.S. team’s upset victory over the highly touted Colombians, the enthusiasm for World Cup now evident in Latino, European, African and Asian communities may spread to the largely indifferent Anglo mainstream. If so, the region’s languishing self-confidence may get the kick in the pants it so desperately needs.*