Michigan governor scouts, touts trade possibilities

Updated: 2012-10-05 11:53

By Yu Wei in New York (China Daily)

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Michigan governor scouts, touts trade possibilities

Governor Rick Snyder gives opening remarks at a trade mission matchmaking session in Chengdu, Sichuan province. He recently returned from the 10-day trip, which was meant to increase his state's exports to China. Provided to China Daily

Government and business leaders in Michigan have been taking note lately of opportunities afforded by China's rapid development and relatively strong economy.

Governor Rick Snyder recently returned from leading a delegation of public- and private-sector officials from his state on a 10-day trade mission to China. It was the second trip to China for Snyder since he took office in January 2011, and the governor says he's focused on building business links between the country and Michigan.

In Shanghai, the Republican reopened the Michigan China Center, which had been shuttered due to state budget cuts. The office assists Michigan companies interested in exporting to China as well as Chinese companies seeking to expand in the state. Snyder called its reopening "an important step in cultivating and expanding partnerships and business opportunities between Michigan and China".

Snyder also visited the cities of Wuhan, Guiyang, Hangzhou and Chengdu to meet with executives from 19 Chinese companies.

On the final day of his visit, Snyder took part in the opening of the Western China International Fair in Chengdu, capital of Sichuan province, which has had a long relationship with Michigan. The wife of then-governor William Milliken led a delegation to sign a Michigan-Sichuan friendship pact in 1982.

Snyder had discussions with Sichuan's executive vice-governor, Wei Hong, and "looks forward to signing an agreement with the governor of Sichuan in the future on exchanges of ideas and innovations in industry and agriculture, science and technology, culture and education as well as travel and tourism," said Jamie Clover Adams, director of Michigan's Department of Agriculture and Rural Development and a member of Snyder's delegation.

The mission also sought to identify possible export opportunities for Michigan agriculture products.

Kellogg Co, probably the best-known food producer in the state, announced during Snyder's trip that it had agreed to form a joint venture with Singapore-based Wilmar International Ltd to make and sell cereal and snacks in China.

"China's snack-food market alone is expected to reach an estimated $12 billion by year-end, up 44 percent from 2008," Kellogg CEO John Bryant said. "This joint venture positions our China business for growth and fundamentally changes our game in China."

The joint venture company between Kellogg and Wilmar, which produces palm oil, will be based in Shanghai. The Singapore company's Chinese subsidiary, Yihai Kerry Investments Co, will also be part of the JV.

"People are more and more concerned about food safety in China," Adams said. "I have the confidence that we produce high-quality products for the Chinese consumer because Michigan has a very good food-safety system."

Shelf-stable milk, milk powder, dried fruit, fresh fruit and soybeans are the most possible exports for Michigan, according to the director.

Michigan's fruit exports to China have grown dramatically. In 2011, Michigan sent 150 metric tons of cherries $300,000 worth of dried fruit; the state exported none of either product to China as recently as 2007.

In total, Michigan agricultural exports to China were $23.4 million last year, and Adams said the state aims to double that by 2015.

Also accompanying Snyder were representatives of 21 Michigan companies who met with prospective business partners about export possibilities.

"This is the first export mission ever to China by MEDC; our previous missions to China focused on investment attraction only," said Deanna Richeson, director of export strategy for the Michigan Economic Development Corporation, a partnership between the state government and the private sector.

The 21 Michigan companies that participated in Snyder's trade mission provide a variety of goods and services, including auto parts, advanced machinery, global logistics, food processing, chemicals and alternative fuels. The company executives stopped in six cities to meet Chinese counterparts and government officials.

Snyder said in a statement upon his return home that the 21 businesses participating in his trade trip "found potential new markets, distributorships and other business partnerships". Chinese government and business leaders, he added, were "eager to seek greater cooperation with Michigan".

Because Chinese culture requires time to develop trusting relationships, the Michigan companies focused on enhancing their existing ties to Chinese businesses.

According to the MEDC, over 100 "matchmaking" meetings were set up for the 21 companies, several of which also met with distributors capable of selling Michigan exports in China.

OG Technologies Inc, a private company based in Ann Arbor that manufactures visual-inspection equipment for industry, signed a deal to provide such a system to China's Nanjing Iron & Steel Co for inspecting the production of wire wrap for rolled steel bars.

"I hope we will have a successful project so that we can move forward with additional projects with Nanjing Iron & Steel as well as with other Chinese steel companies," OG President Shuh Chang said.