Midwest county knows how to draw FDI

Oakland County, Michigan's success in attracting foreign direct investment (FDI) is underscored by one stark figure: $1 million-plus a day.

The county located in the northwestern section of the Detroit metropolitan area totaled $371 million in FDI in 2016.

The new investment has accounted for close to 6,400 jobs (either new or retained). Oakland County has more than 1,050 global firms from 39 countries.

And the No 2 country on the county's investment roster (behind Germany) is China.

Michigan Governor Rick Snyder has led six trade missions to China, and he is frequently joined by Oakland County officials.

"This (FDI) is a sector of our economy that doesn't get a lot of attention, but this is a significant source of jobs and tax revenue," said L. Brooks Patterson, Oakland County executive. "Oakland County gets more investment than many states, and rest assured, we're going to press forward with this program."

The county is nearing a total presence of 75 Chinese companies after it adds "another dozen or so in 2017", said Matthew Gibb, deputy executive in charge of economic development.

"We're the heart of the automotive industry. We have 75 of the top 100 tier one global automotive suppliers," Gibb told China Daily. "When I go into China it gives us the credibility of the Motor City, the Detroit market. We're the ninth-wealthiest county in America; we have no debt.

"I'll speak at the global automotive forum in Chongqing, and at the same time I'll have my senior business development rep and then other members of the region, like from a chamber, a law firm, an accounting firm; they'll do direct business-to-business consulting work, on legal barriers, financial barriers, accounting barriers.

"Once you get your traction in having a system (in automotive) of being able to pull in companies on an international basis, it applies to a lot of markets."

Gibb, who has been to China 14 times, said the county is not as concerned with where a company makes its products.

"You don't have to land a factory to have growth If I have a company here (in Michigan) that needs to build a manufacturing facility in Shenzhen or southwestern China, I'm not going to lose sleep over the fact that they're doing that and they're not doing it here, because that's going to result in 30 or 40 new jobs that are here just to support the operation.

"They're not moving the company over there. I think sometimes it gets lost. It's not necessarily chasing cheap labor anymore; it's a chase of market share. Ford is Chongqing. All those same tier one suppliers that are here are all in Chongqing because they all support Ford. Companies have the ability to build a product and sell it everywhere."

And it's not just automotive, Gibb explained.

"One of our strongest sectors is medical life science. We negotiated a relationship with China Medical City. When I go back to Jiangsu, I'm always visiting China Medical City (in Taizhou) and bringing commercialized product potential out of the United States to them. At the same time, they're looking at how they can create a presence of bringing some type of base manufacturing or product development here."

Gibb said he is sometimes asked, "Did you bring another Fuyao Glass-type company to town? Sometimes we do."

But not all of the companies as are as big as the automotive-glass giant.

"Some of these companies are coming over, and we're doing almost an initial startup, 10 or 12 people in an office," Gibb said. "Shanghai Automotive is our big partner, SAIC. A lot of their subsidiaries we've been able to pick up on."

Although Oakland County is car country, more than a decade ago it moved to diversify its industries. In 2004, the county developed its Emerging Sectors business development strategy to expand beyond its automotive nucleus.

The county is also attuned to understanding China beyond business. Of its 28 public school districts, Mandarin is taught in 17.

But it always comes back to relationships.

Gibb said the key is that if "you have somebody that understands the culture of doing business in China, and has a respect for the importance of matching these two global economies", your chances of success are that much greater.

Contact the writer at williamhennelly@chinadailyusa.com