California-Armenia office likely done

GLENDALE — The California-Armenia Trade Office will be effectively shut down in January after Gov. Arnold Schwarzenegger on Saturday vetoed a bill that would have kept the operation running through 2010.

The privately funded, state-sponsored operation with offices in Glendale and Yerevan, Armenia, has been California’s only foreign trade office since 2003, when legislators folded promotional offices in Hong Kong and Mexico City amid a state budget crisis.

Established in 2002 under legislation by state Sen. Jack Scott and backed by California’s Armenian-American community, the office made the cut largely because it gets no funding from taxpayers. The operation’s two offices, which work to connect California companies with Armenian customers and vice versa, are supported entirely by the nonprofit Foundation for Economic Development.

But extending the life of the office was considered “premature” by the governor, considering ongoing work to establish a new state international trade strategy, Schwarzenegger said in a statement.

“The creation of an Armenian trade office was prudent in 2002 when the Legislature instituted the office,” he said. “Since then, the Legislature has closed all other trade offices throughout the world and last year passed legislation mandating the creation of a state international trade strategy.”

It’s unclear whether that strategy — expected be outlined in a report due in February from the state’s Business, Transportation and Housing Agency, which oversees the California-Armenia Trade Office — will make room for an Armenian trade office, said Garret Ashley, the agency’s undersecretary for international trade.

“It probably made sense to look at that region in 2002, but when all of the offices were closed in 2003, since then I think we need to take a comprehensive look at the world and what we’re going to do,” Ashley said.

The California-Armenia Trade Office, which has been billed as an outlet for California companies not only to Armenia but to other post-Soviet republics in the region, has been poked at by critics who wonder why the state would maintain its sole trade office in a poor, landlocked country that, according to CIA data, ranks 128th among world economies. Taken as its own nation, California alone would boast the world’s eighth-largest economy.