Think ‘glocal’ and move Michigan to its next level #ThinkGlobal #TellUsDetroit

Op-Ed By Tom Watkins/Tell Us Detroit

As Michigan’s powerful gather on Mackinac Island they need to think “glocal,” both global and local.

The annual watering hole gathering of Michigan’s top civic, business, labor, education, government, political and foundation elite is set to begin.

Beginning May 29, the Detroit Regional Chamber’s Mackinac Policy Conference will draw up to 1,500 of Michigan’s “movers and shakers” to Mackinac Island. They will eat, drink and mingle on the world’s largest porch at the Grand Hotel to gab about the state’s problems and opportunities.

One opportunity that is front and center is China. China is home to the fastest growing world economy, a rising middle class, with 1.4 billion potential customers for us to tap.

Gov. Rick Snyder, reversing multiple years of playing “Peking duck” with China, traveled to the Land of the Economic Dragon in his first six months in office. He sent a signal to the Chinese that Michigan is open for business and wants to develop mutually beneficial relationships to seal deals.

Michigan’s new governor understands we have many goods and services to sell the Chinese along with an equal number of investment opportunities for newly wealthy Chinese to invest in Michigan.

This governor “gets it” when he says, “It’s all about creating jobs for Michigan families and creating bright futures for our kids.”

Michigan must adapt to the 21st century global economy through innovation and collaboration in order to succeed.

Fareed Zakaria, CNN contributor, and Thomas L. Friedman, New York Times columnist, will be “keynoters” at the conference. They may want to remind the audience that Michigan is two beautiful peninsulas– not an island and while we dithered, the world moved forward.

Snyder understands Michigan can and must be open to global trade and investment and has set in place policies and programs to assist.

In the past, much of the conversation in Michigan surrounding China has been negative. I have argued for some time that the China wave is coming. We have a choice: Do nothing and be swamped, or learn to surf and ride the wave.

The tide has been turning since Deng Xiaoping opened China’s doors to the world 30 years ago. Their economy has grown at double digits even as much of Michigan turned to hand-wringing.

Building Harmony At Home And Seeking Global Partners

During the recent 20th anniversary of the Chinese Association of Greater Detroit’s annual dinner, China’s Chicago-based Consul General, Yang Guoqiang made it clear that China values our state and region. Yang said, “the opportunity exists to build on the strength and needs of Michigan and China that can be mutually beneficial.”

We welcome the Consular General’s knowledge, connections and facilitation that may help us build solid, productive and mutually beneficial bridges with China that represents an ancient civilization – and one-fifth of all humanity in the fastest-growing world economy.

China continues to evolve and change. There are more and more signs that China is once again shifting its state-controlled “Capitalism, with Chinese characteristics”, and moving from an exports-dominated economy to one with greater emphasis on domestic consumer spending.

This shift is driven by the slowdown in the global economy, especially in the U.S. and the European Union amid the growing discretionary income now available to more and more Chinese citizens.

It is said more than 400 million Chinese have moved from abject poverty to the equivalent of a Chinese middle class over the past three decades.

World Bank President Robert B. Zoellick said, “China’s leaders have recognized that the country’s growth model, which has been so successful for the past 30 years, will need to be changed to accommodate new challenges.” Moving from an export economy to a more and more of a domestic consumption economy is growing.

London-based Goldman Sachs Asset Management macro-economist Anna Stupnytska says, “The rise of the Chinese consumer will be the most important trend in the coming decade.”

Michigan Connection

Many may ask, “Who cares?” Everyone in Michigan and America should. The China market is the 21st century consumer gold mountain of economic opportunity.

Understanding that doing business in China is not the equivalent of an economic “one-night-stand” the governor and his team have follow-up trips planned for this autumn. We can travel to “Red” China as a way to make “green”/cash and create jobs in Michigan.

Michigan and America have much that a newly-demanding Chinese consumer wants and needs. With leadership, opportunities abound.

Exports, Autos and Technology

China is Michigan’s third largest export market, behind only Canada and Mexico. The potential for growth is exponential.

GM and Ford have been and will continue to do well, building and selling cars in China. If it were not for the Chinese market, neither company’s bottom line would be as black as it is today.

The Chinese are seeking both new technologies and management skills that exist in abundance in Michigan.

Agriculture

Think blueberries. The Chinese love blueberries and Michigan is a world’s leading producer of this fruit.

Dairy products, cattle, corn, hogs, soybeans, turkey, chicken, wheat, and sugar beets are some of the many products we could be selling in China.

Food quality and safety is a hot topic in China. Scandals with tainted milk, fake products, and toxic food additives are near daily occurrences that spark fear and outrage throughout the country.

The Chinese are tech savvy and technology is ubiquitous from the mega cities to the country-side. Weibo, the Chinese version of Twitter, lights up like an airport runway when a food or other scandal erupts.

Knowledge is power and the average Chinese has more yuan (Chinese currency) in their pockets to spend and more knowledge to demand greater value for their money.

Sustainability

With one-fifth of the world’s population, an ancient civilization of over 5,000 years, rapid industrialization and a rising economy, China faces environmental challenges and a need to enhance sustainable practices on a scale only matched by the vast size of the country.

China is in the process of erecting entire new cities that are building sustainable practices from the foundations up.

We can make green from China’s dirt by helping clean their air, lakes, streams and land that have been degraded by the country’s rapid growth. We have both the technology and experience addressing our own pollution crisis.

We can work together to help build a better and more sustainable planet.

Investment

Michigan has attracted the seventh highest amount of Chinese direct investment since 2003 and there is more Chinese yuan available. Many estimate China will invest over a trillion U.S. dollars world-wide over the next decade. Michigan would be wise to get its fair share.

Eric Huang, doing his part, organized the second annual Detroit International Advanced Manufacturing Technology Show (DIAMTS) October 23-23, 2012. Mr. Huang sees Michigan as an “international gateway for worldwide customers as the 21st century unfolds.”

For more information on DIAMTS go www.diamts.com or call 248 461-2678.

MEDC Builds Bridge To China

The Michigan Economic Development Corporation and Export Now, an export services company, have partnered to launch a China export initiative for small business. As a result, Michigan consumer goods companies interested in reaching 1.3 billion new customers in the fastest growing economy in the world can now do so.

The program will offer Michigan companies the opportunity to test their products in the Chinese consumer market with limited risk. “This unique exporting program builds on Gov. Rick Snyder’s mission to China last fall,” said MEDC President and CEO Michael A. Finney.

With support from MEDC, Michigan companies will pay only $1,000 to sign up with Export Now and use the service for one year, two-thirds less than the usual $3,000 charge. Michigan companies will ship goods on consignment to an Export Now depot in California, where shipments are consolidated and forwarded to Export Now’s Shanghai distribution center.

“This program opens up one of the world’s largest markets to Michigan’s food and agriculture businesses,” said Michigan Department of Agriculture and Rural Development Director Keith Creagh.

“New customers mean more sales and that translates into jobs,” Frank Lavin, CEO of Export Now, explained. Lavin continued,“Through our unique e-commerce solution, we eliminate the challenges of language, culture and regulation that prevent many small businesses from entering new markets.”

For more information visit: http://www.michiganadvantage.org/STEP and indicate “Export Now” in the comments box, or call MEDC’s customer contact center at 888-522-0103.

With continued entrepreneurial spirit and leadership, embracing our Chinese colleagues here and across the ocean can only help Michigan prosper.

So, as our state leaders gather on an island remember to fix Michigan’s problems so we can be competitive on the world stage.

Tom Watkins has a life-long interest in China sparked by a fourth-grade teacher. He has traveled, worked and written extensively about China for over a quarter century. He is a former Michigan state superintendent of schools, CEO of the Palm Beach County Economic Council and is currently a U.S./China consultant. He can be reached at: tdwatkins88@gmail.com

 

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