Consulate’s closing ‘a setback for Houston’
City’s ‘special relationship with China,’ trade and tourism likely will take a hit
For more than 40 years, the Chinese Consulate General in Montrose has served as a symbolic bridge, facilitating travel, trade and cultural ties between Houston and China.
The Trump administration’s decision this week to force the consulate in Houston to close by Friday “to protect American intellectual property” will have wide-reaching consequences for Houston residents and companies with significant ties to China.
Chinese expats in Houston will find it more difficult to renew passports. Houstonians traveling to China to close a business deal or walk the Great Wall can’t get a visa as easily. Chinese travelers and college students who fill the coffers of Galleria retailers and Texas universities may find it less attractive to visit Houston without a consulate nearby if they need assistance.
All of this will hurt travel, trade and the long-standing relationship between Houston and China, said Bob Harvey, CEO of the Greater Houston Partnership, a business-backed economic development group.
“Houston has had a special relationship with China going back to George Herbert Walker Bush,” Harvey said. “We’ve been able to maintain that warm relationship, even when we’ve had meaningful disputes. The lack of a Chinese Consulate will hurt and will be a setback for Houston.”
China established its Houston consulate — the country’s first in the U.S. — shortly after Deng Xiao
ping’s historic visit here in 1979. The former Chinese leader, reciprocating President Richard Nixon’s historic visit to China in 1972, stopped by Houston as part of a national cultural exchange opening China's economy to Western companies.
In the following four decades, Houston’s relationship with China deepened. Barbara Bush helped establish the Asia Society Texas Center in the Museum District in 1979. The Houston Rockets drafted Yao Ming in 2002. And tens of thousands of Chinese immigrants flocked to Houston, creating a vibrant Chinatown.
The relationship has not been without controversy, especially in recent years. In October, Daryl Morey, the general manager of the Rockets, tweeted a message in support of pro-democracy protests in Hong Kong that caught the ire of the communist Chinese government, which imposed bans on the NBA and the Rockets. In November, a Chinese employee of Houston refining giant Phillips 66 pleaded guilty to stealing confidential information on the company’s battery technology, prompting the U.S. to increasingly push back against alleged Chinese theft of intellectual property.
‘Drastic’ action
However, the usual U.S. reaction to disputes is not to burn bridges by closing consulates, said Victor Shih, a Chinese politics professor at the University of California at San Diego. The Chinese Consulate in Houston served Chinese expats and U.S. travelers in eight Southern states and Puerto Rico.
“The typical response to things like embassy staff involved in espionage is the expulsion of the involved diplomats,” Shih said.
“Closing down the entire consulate is a fairly drastic course of action that will create a lot of inconvenience for anyone traveling to China.”
Once the Chinese Consulate in Houston closes, Houstonians looking to secure a Chinese travel visa will have to use one of the nation’s other consulates in Washington, D.C., New York, Chicago and Los Angeles. They could hire an agent to obtain a visa remotely, but that can cost an additional $70 to $200 on top of the typical visa fee, depending on how quickly the visa needs to be processed, Shih said.
Ease of travel is essential for trade, particularly for a relationship-oriented country like China, Harvey said. China is Houston’s third-largest trading partner, exchanging $14.7 billion in goods and services last year, the Greater Houston Partnership said.
Houston imports computers, electronics and machinery from China, and exports products like petroleum, refined products and chemicals to China, which is poised to become the largest market for U.S. liquefied natural gas.
Forty-four Houston firms operate 113 subsidiary locations in China, including engineering and manufacturing company Dresser-Rand and oil field services firms Halliburton and Schlumberger. Seventeen Chinese firms operate 23 subsidiaries in the Houston area, including Air China, Petro-China and automaker Saic Motor.
The additional hurdle to get Chinese travel visas won’t have a huge effect on multinational corporations, but smaller companies doing businesses in China will likely suffer, Shih said.
Before the global coronavirus pandemic shut down international travel, executive Sky Li traveled to China every two months for business. The chief operating officer at Houston energy consulting firm Offshore Intel is a U.S. citizen from China who has a 10-year multi-entry visa to work in China. But many of his colleagues have visas that must be renewed annually. The company was planning to send a software engineer to China to launch an LNG project in November but is postponing the trip because of visa uncertainties.
“I understand the U.S. government wants to protect U.S. companies,” Li said. “In the short term, it might protect the U.S., but long term, it cuts lots of good opportunities for U.S. companies.”
Reduced travel from China also could take a toll on tourism revenue. Chinese travelers to Houston spent $158 million in 2018, and the average Chinese traveler spends as much as $5,000 per person per trip, according to Houston First, the city’s convention and visitors bureau.
In addition, international students from China may be turned off by the consulate closing, Shih said.
“Top Texas universities, such as Rice and UT Austin, will still be attractive to Chinese students,” Shih said. “But on the margin, there will be some impact. There will be some Chinese parents, all things being equal, who may want their kids to attend Chicago or California-based universities because they have a consulate there.”
Differing views
Brian Liu, a Chinese American and former board member of the Chinese Community Center, said he fears that the closure of the consulate will perpetuate antiAsian sentiments stirred up by the coronavirus pandemic and Trump’s rhetoric about the virus.
“I was born in China, and came to the U.S. after college and spent half of my life here,” Liu said. “We have family here, we raised our kids here and we want to build up this beautiful city. But we still have ties to China. There is no way to cut our ties.”
The consulate’s closing does not disappoint Ni Zhao, however. A member of the Falun Dafa religious group that often protests against the Chinese government, she visited the consulate Thursday with her two sons and a stack of pamphlets promoting the movement. She said the closure would be good, adding that the Chinese government perpetually lies.
"Houston,” she said, referring to the city’s energy and medical sectors, “(has) too much importance.”