Michigan benefits from long-sighted ties building with Chinese

In business, Rick Snyder says, deals are not the way to success - "It's building a relationship that goes on for years".

That, for the Michigan governor, was the value of the Detroit Chinese Business Association's (DCBA) Chinese New Year Gala. The black-tie affair at the Cobo Center in downtown Detroit not only celebrated the Year of the Horse: it highlighted the non-profit group's nearly two decades of developing and promoting US-China business, trades and exchanges.

The key to being successful "is not about transactions", the first-term Republican governor told the audience in the ballroom along the frigid Detroit waterfront. "It's about building a relationship that goes on for years; and doing something that people too often take for granted - earning trust."

Early last month, the 55-year-old former venture capitalist, CEO and accountant formally announced he would seek a second term as governor of Michigan, a state known as the center of the US automotive industry. The three major US automakers - General Motors Co, Ford Motor Co and Chrysler Group LLC - all have their headquarters within the Detroit metropolitan area.

In an impromptu media scrum after his speech, Snyder, who has pursued relations with China in three trade missions in as many years, told reporters that he hopes to make yet another China trip after the November election. "It will be difficult to do it before then, but hopefully in a later part of the year we'll make another trip," he said.

This state of 9.9 million in the Great Lakes area of the Midwestern US with 8.4 percent unemployment is crawling back from a US economic downturn that hit the automotive industry hard. At the gala, Snyder pronounced Detroit as already heading back from the depths of its historic bankruptcy filing, citing the downtown core's nearly 100 percent residential occupancy rate. The state wants China trade - especially with the country on track to become the world's second largest consumer market by 2015. In 2012, China was Michigan's third largest export market, with $3.3 billion in export sales.

Asked by China Daily how he would characterize the China-Michigan relationship, the governor called it "strong but still evolving".

You "have to build over time", the governor said. "So we've come a long way from my first trip in terms of the relationships that have been built. But I want to see them get stronger and stronger. We need to build that relationship trust with China."

Snyder termed Detroit, whose bankruptcy filing last summer capped off a 60-year slide for the city, "one of the great value opportunities not only in the United States, but in the world". Investors can pick up high-end properties in the Motor City at a fraction of the cost of comparable properties elsewhere in the country.

In October, Shanghai-based property developer Dongdu International Group acquired the former headquarters of the Detroit Free Press and the David Stott building for $4.2 million and $9.4 million, respectively. DDI said at the time it "carefully researched" the properties and "appreciated their heritage" as well as the local business community's drive to rejuvenate Detroit.

DDI board member Eddie Wang, one of the speakers at Thursday's gala, said his company aims to redevelop the properties but also "to continue with acquisitions". The impetus for that spree comes partly from policies in China aimed at cooling off an overheated housing market motivating DDI and other Chinese commercial property companies to hunt deals abroad.

Wang's remarks set the stage for Hai'an county mayor Weidong Lu, another gala guest and speaker, to sign a memorandum of understanding the next day with Oakland County Executive L. Brooks Patterson. The agreement will open up future investment, educational opportunities and cultural exchanges between Oakland, a county of 1.2 million with some of the most affluent US communities, and Hai'an, a county of 1 million residents in Jiangsu province. Magni Group Inc, a Birmingham, Michigan-based supplier of protective metal coatings to the automotive industry, has agreed to expand operations and build a plant in Hai'an, Patterson said.

"For the past two years the delegation from Hai'an has been our most frequent international guest," Patterson said in a statement. "They have been here four times in the past two years. I've heard it said that when we meet for the first time, we're acquaintances. Our second meeting, we become friends. After our third meeting, we become old friends. And with this, our sixth meeting, we've become like family."

All of which proves, as Detroit-area advocates of more trade with China are finding out, that relationships are hard work.

Contact the writer at michaelbarris@chinadailyusa.com.

(China Daily USA 03/03/2014 page2)