Louisiana looks to boost its China trade

Push­ing ex­per­tise in oil, chem­i­cal pro­duc­tion and look­ing ahead to avi­a­tion and aero­space

China Daily (USA) - - ACROSS AMERICA - By PAUL WELITZKIN in New York paulwelitzkin@chi­nadai­lyusa.com

Louisiana wants to par­lay its strengths in oil and nat­u­ral gas and chem­i­cal pro­duc­tion into ex­panded trad­ing ties with China, ac­cord­ing to the state’s top eco­nomic devel­op­ment of­fi­cial.

Don Pier­son was ap­pointed sec­re­tary of Louisiana Eco­nomic Devel­op­ment when John Bel Ed­wards be­came gov­er­nor in Jan­uary. Pier­son said the state in­tends to build on its tra­di­tional in­dus­tries — en­ergy and chem­i­cal pro­duc­tion, forestry and man­u­fac­tur­ing.

“We are also con­fi­dent of em­brac­ing fu­ture op­por­tu­ni­ties in avi­a­tion and aero­space, IT and wa­ter man­age­ment,” he said in an in­ter­view in New York on Tues­day.

Trade be­tween Louisiana and China has been thriv­ing. Since 2008, Louisiana has ranked first in the US in per capita for­eign di­rect in­vest­ment, and Chi­nese com­pa­nies have played a large part.

China is the sec­ond-largest in­vestor in Louisiana.

China rep­re­sents Louisiana’s top ex­port mar­ket, with more than $8.6 bil­lion in ex­ports in 2014, rank­ing Louisiana No. 4 among US states in ex­ports to the main­land.

Pier­son said there are two ar­eas that ap­pear to be par­tic­u­larly promis­ing for ex­pand­ing trade be­tween the state and China. One is pro­duc­ing chem­i­cal feed­stock like methanol, which is re­quired to man­u­fac­ture chem­i­cal prod­ucts.

An­other in­volves the pro­duc­tion of liq­ue­fied nat­u­ral gas, or LNG, which is cre­ated when nat­u­ral gas is cooled to mi­nus 259 de­grees Fahren­heit.

In 2014, Louisiana se­cured an in­vest­ment of $1.85 bil­lion from Shan­dong Yuhuang Chem­i­cal Co to de­velop a methanol plant in Louisiana’s St. James Parish. The fa­cil­ity, which is ex­pected to cre­ate 400 per­ma­nent jobs and about 2,000 tem­po­rary con­struc­tion jobs, is un­der con­struc­tion.

“We an­tic­i­pate it will come on line and be­gin pro­duc­tion in 2017,” he added.

While low oil and nat­u­ral gas prices hin­der the state’s en­ergy pro­duc­tion, the prices are a spur for the chem­i­cal busi­ness.

“The drop in oil prices has hit some ar­eas of Louisiana hard, as we are the num­ber two pro­ducer of oil and nat­u­ral gas in the US,” said Pier­son.

“But the low prices also cre­ate an op­por­tu­nity, since oil and gas are the feed­stock for chem­i­cal pro­duc­tion and are also used to power the fa­cil­ity that man­u­fac­tures the feed­stock.”

China’s grow­ing econ­omy will re­quire feed­stock for chem­i­cal prod­ucts, and Louisiana’s strate­gic lo­ca­tion on the Gulf of Mex­ico will make it easy for Chi­nese firms to es­tab­lish pro­duc­tion in the states and then ship the prod­uct back to China through the state’s pipe­line net­work or from one of its ports, said Pier­son.

Louisiana’s port sys­tem is among the largest in the world, with 27 deep­wa­ter and shal­low-draft ports.

Don Pier­son, sec­re­tary of Louisiana Eco­nomic Devel­op­ment

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