China Daily Global Edition (USA)
OREGON OPENS UP TO CHINA’S POSSIBILITIES
FThe US Northwest state has many initiatives underway to expand its market presence and emerge from the shadow of neighbors California and Washington state, reports from Portland and Salem. rom the state Legislature to local business owners and residents in Oregon, the consensus is that China remains “critically important” to the state’s economy. Trade, culture and education, as Oregon Governor Kate Brown suggested in a recent interview with China Daily, are going to be the three pillars that the state pushes forward for more collaboration with its Chinese counterparts.
Steven White knows from first-hand experience that China’s thriving consumer demand will drive overseas sales of Bob’s Red Mill Natural Foods to new highs.
As the export regional sales manager at the Milwaukie, Oregon-based company that specializes in producing whole grains and baking mixes, White oversees the 40-year-old company’s business outside of the US.
He monitors the company’s only flagship store in China, which was launched last year on Tmall, the cross-border marketplace of China’s e-commerce giant Alibaba.
Through its online store, Bob’s Red Mill can access Alibaba’s more than half billion clients and sell to the entire Chinese market.
Since inception of the e-store, “We saw a steady increase in the numbers of orders we receive from online,” said White, adding that consumers cluster around big cities such as Shanghai, Beijing, Shenzhen and Guangzhou.
“Our natural, certified organic, and some gluten-free milled grain products, beans, seeds, nuts and dried fruits are popular,” said White. “It has become a trend among the 300 millionstrong Chinese middle class that they choose to live on a healthy lifestyle.”
Like White, many small- and medium-sized enterprises (SMEs) in Oregon are eager to learn about China and how to sell to the world’s second-largest economy.
“We have too many state treasures, but too little has yet been known in China,” said Jin Lan, president of the Oregon-China Sister State Relations Council (OCSSRC), an organization that has promoted Oregon and its natural resources, tourism attractions, tech and farm products to Chinese counterparts since the 1980s.
“Do you know that Oregon grows almost all the hazelnuts consumed in the US, and blueberries of the finest quality and texture in America?” Lan asked.
Indeed, Oregon didn’t sufficiently promote its attributes, echoed Charlotte Christensen, a Portland resident who was a regular volunteer on the council since 2010 and now is a board member.
“We produce everything from computer chips to wines and apples,” she said. “Our workforces are highly skillful, and companies like Intel, Nike, Columbia Sportswear and Adidas USA have all found great success in Oregon.”
Lagging, but catching up
Chronically dwarfed by its affluent and economically stronger neighboring states, Oregon remained obscure and less lucrative to Chinese investment over the years.
Instead of injecting money into a place where its economy is heavily dependent on fishing, manufacturing, the timbers and inland agriculture, shrewd institutional and individual investors would rather choose high-yielding programs of high-tech components in California or Washington state.
According to New York-based Rhodium Group, the accumulated Chinese investment in Oregon in the past 17 years was $329 million on 10 deals, a moderate sum compared to $27.6 billion in California on 458 deals, and $1.5 billion in Washington on 51 deals.
Currently, China remains Oregon’s top trade partner and top source of international students and visitors. Last year, Oregon exported to China $5.8 billion worth of goods, or a total of 36,038, 20-foot equivalent unit (TEUs) containers, according to the Port of Portland. The leading China-bound commodities are hay and animal feed, lumber, metal scrap, frozen potatoes, wood pulp and other general merchandises.
China imported an annual minimum of $240 million worth of Oregon agricultural products.
“The figure is incomplete if you take into consideration that some Oregon-grown or manufactured goods are shipped from ports in Washington or California and aren’t counted toward the total,” said Gregory Borossay, general manager of trade and cargo development at the port, who in September will join JHJ International Transportation as director of marketing in North America.
Kun Lyu, standing representative of the Qingdao Center for Business & Commerce in the US, which is based in Silicon Valley in California, said Oregon is among the investment destinations the center would least consider.
“Programs and projects under our radar are clustered in California, New York City or Boston,” Kun said.
“It’s regrettable to see Oregon lagging behind other states, even as it’s blessed with the geographical gateway location, abundant natural resources and enticing sceneries, and more importantly, there is no sales tax,” said Lan.
In 1984, Lan and his committee facilitated a “sister state” relationship between Oregon and China’s Fujian province, unfolding many yearround exchanges between the two.
In 1988, the city of Portland and Suzhou in China’s economic powerhouse Jiangsu province sealed sister-city ties.
Portland offered to help develop a sewage system in the 2,500-year-old Suzhou city, famed for its canals, pagodas and traditional gardens. Artisans from Suzhou built the Lan Su Chinese Garden in Portland’s Old Town to open a window into classic China.
Oregon is the first state to pass legislation to promote Chinese Mandarin education at the primary and secondary levels. It has 35 Confucius Classrooms — the highest number of schools in the US that offer Mandarin Chinese classes.
More than 6,000 students have directly benefited from this program, not to mention the families and friends of those students who directly or indirectly learn about China at the same time, said Governor Brown.
Oregon has two Confucius Institutes, one at Portland State University since 2007 and another at the University of Oregon since 2009, in addition to a Chinese Flagship Program initiated in 2005 at the University of Oregon that provides undergraduate students with pathways to professional-level proficiency in Chinese alongside academic majors of their choice.
“They have added a lot to a growing pool of Oregonians who have more understanding of China, both the language and culture,” said Brown, adding that “there is no doubt that these programs have helped internationalize the local community a great deal.”
Joint efforts
In recent years, the focus of the bilateral relationship shifted more toward investment, trade and export, said Lan, adding they are not forgoing education and culture.
“In order to create permanent jobs, get people paid decently and make the local economy strong, we need to strengthen the relationship with China,” said Christensen.
On July 5, the Oregon House passed the Concurrent Resolution 39, which expresses the intent of the Legislative Assembly to support continued collaboration between Oregon and China, a move that makes Oregon the first American state through a type of legislation to increase trade opportunities and strengthen economic development with China.
Because of Intel and substantial agriculture exports, “China is our biggest trade partner in 2016; with $5.8 billion in Oregon exports, over 20,000 jobs in Oregon benefit from trade with China, and China is Oregon’s No. 1 source of international visitors,” said Brown.
According to the US Department of Commerce, Oregon is among eight American states that have a trade surplus with China, and it reported a $3.7 billion trade surplus last year.
“For Oregon’s economy to continue to grow, we must have access to the global economy. That’s why strong partnerships with countries like China are so critical to the well-being of our state,” said Brown, adding that concrete measures are in full swing.
For example, Business Oregon, or better known as the Oregon Business Development Department, has a global trade and investment team that assists SMEs to do business with China and help Chinese companies interested in investing in Oregon.
Meanwhile, export assistance and grants are offered to Oregon companies that want to exhibit at trade shows or participate in trade missions to China “to help them sell Oregon products to Chinese consumers”, said Alexis Taylor, director of the Oregon Department of Agriculture, who was the department’s former deputy undersecretary of Farm and Foreign Agricultural Services.
“She has tons of experience in terms of promoting local products to the global market,” said Lan.
At a recent two-day trade show in June that Taylor and her team organized for local drink makers and vendors of snack foods such as nuts, seeds and fruits, small business owners were able to showcase their products for a visiting trade group from China.
Trade mission members sampled cider, wine, mead and beer as they moved from booth to booth. “We definitely will do more,” said Taylor. Brown said the state will rely on e-commerce to help smaller companies market their products to China’s growing middle class. “We have been working with various e-commerce companies to help get Oregon products to Chinese consumers,” she said.
Lan and his council already took the initiative to construct “Oregon’s Very Best”, an e-commerce platform under construction to promote Oregon-made products in Tianjin, one of China’s four municipalities well-known for manufacturing, ports, educational base and cultural heritage.
An off-line product display in the Tianjin International Sister City Pavilion, a 700-square-foot showroom at Tianjin Port Free Trade Zone, is what Lan and his team are refining now in order to create for Chinese customers a favorable off-line and online integrated shopping experience.
“Only products of the best quality, the most symbolic meaning would be chosen to display,” Lan said.
On July 5, Lan chaired the Oregon-China international seminar on e-commerce in Portland, which featured government officials, business owners and scholars from China and Oregon in order to promote communications and seek business solutions for SMEs.
White met members of a trade delegation from Tianjin and brainstormed with potential Chinese partners on how his company’s products would gain more market exposure on a national level.
“China is humongous. Its market is multilayered and so complicated. There is always something new to catch up on,” he said.
Li Shengli, president of the Tianjin Chamber of Commerce for Import and Export, led a delegation of 20-strong business owners, investors and agriculture experts to attend the e-commerce seminar in Portland.
“We need to expedite information-sharing and collaboration to advance trade and the business relationship,” the seasoned industry leader said.
“Given Tianjin’s 1 million population and many of its well-off citizens, Oregon business owners will benefit from the strong consumer demand there,” Li said.
Impressed by the high quality of pinot noir, riesling and blush wines he sipped at a vineyard and winery west of Portland, Li said “that’s exactly the upscale American products we are looking for. I’m sure there are more surprises in Oregon than we Chinese have thought.”