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AnonymousInactiveChina buys ‘Made in Midwest’
Midwest benefits from China trade
Hogs, floor tiles and ink cartridges among products flowing to fast-rising partner
GREENVILLE,
Ohio — Eight years ago, China was just another foreign country on the
map to farmer Bill Funderburg. Now, the Chinese buy nearly half of the
3,000 breeding hogs he raises each year on his western Ohio
farm.”They’re our No. 1 customer,” he said. “Lately, it’s been very,
very good.”The Chinese boom is translating into jobs in Rust Belt
communities that have taken their economic lumps, even as critics point
to a trade gap with China that is projected to grow 12 percent to $228
billion this year. China also has the second-largest holdings of
Treasury securities among foreigners, who have 45 percent of $1.96
trillion that is publicly traded.Companies say the payoff for the jet
engines, books and ink cartridges being sold to China outweighs the
difficulties of doing business in the country, including cultural
barriers, tariffs and limited distribution systems.Peoria, Ill.-based
Caterpillar Inc. has increased its exports by 40 percent in the past
few years. A $58 million contract to supply China with generators that
capture methane gas from coal mines and convert it into electricity
means more jobs at Caterpillar’s plants in Lafayette, Ind., and
Griffin, Ga.Summitville Tiles Inc. in eastern Ohio supplies ceramic
tiles for the floors of KFC restaurants popping up in China at a rate
of 400 stores a year.”Any time that you are shipping millions of square
feet of product, it is significant, and it has helped keep workers in
my factory working,” company President Dave Johnson said.China’s
economy is sizzling as it continues to move toward a market-based
system, permitting small-scale enterprise and fostering foreign
investment.U.S. companies exported $41.8 billion in goods to China in
2005, up from $16.3 billion in 2000. The 157 percent growth far
outstripped the 21 percent jump in U.S. exports to the Netherlands —
the second-largest increase — and catapulted China up to the
fourth-largest U.S. export market, behind Canada, Mexico and Japan.”The
Chinese market is growing so rapidly that everybody’s trying to get a
piece of it,” said Beno Chan, a Fairfield, Conn.-based businessman who
has helped U.S. companies get into the Chinese market.The boom has been especially sweet to Midwestern states.
Ohio
— which has lost about 167,000 jobs in the past six years — had $934
million in exports to China in 2005, a 220 percent increase from
2000.Illinois, which lagged behind the rest of the country in income
and employment growth following the 2001 recession, has seen its
exports jump to $1.2 billion, more than twice the $533 million in
2000.MTS Systems Corp., an Eden Prairie-based company that makes
equipment to test the performance and durability of everything from
planes to orthopedic joints, expects to as much as triple its 25-person
work force in China because sales there have picked up.The market began
to open to U.S. exports in 2001 after the Chinese joined the World
Trade Organization to help generate their own economic growth. Before
that, U.S. companies faced high import tariffs and quotas, were
required to get import licenses and were forced to use Chinese
companies to service their products.Today, tariffs have decreased,
import licenses and quotas have all but disappeared, and U.S. companies
often don’t have to use Chinese companies for service.Some U.S.
businesses got their start in China by making contacts through agents
the companies hired to find export opportunities or by selling to the
Chinese government or universities and expanding to the private
sector.U.S. companies acknowledge that a political shift could make
China more closed to their products. Democrats, who won control of
Congress in recent elections, tend to be aggressive critics of Chinese
trade policies.”In the long run, I believe market demands — and these
are huge — will outstrip political issues,” MTS CEO Chip Emery said. -
AuthorNovember 28, 2006 at 11:18 AM
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