Governor Ricketts: Nebraska’s Good Relationship With China Always Has Room To Grow

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Governor Ricketts: Nebraska’s Good Relationship With China Always Has Room To Grow

This article originally appeared in China Daily USA on January 13th, 2018.

By YUAN ZHANG | China Daily USA

Nebraska, the home state of investment guru Warren Buffett and top exporter of US beef to China, is looking for more Chinese investment and diversified cooperation

In a recent exclusive interview, Nebraska Governor Pete Ricketts offered his optimistic views on economic and trade cooperation between his state and China, as well as enhanced exchanges in agriculture, education and tourism. Last year, 36,000 people attended the Berkshire Hathaway annual event. One out of six of these people were business people from China.

Since taking office in January 2015, you have visited China twice. What did you achieve on those visits?

On my visits to China I worked to expand Nebraska’s ties with Chinese business and culture. China is our second-largest export market outside of North America. We always want to improve and expand relationships to our mutual benefit.

Our visits resulted in many good things for Nebraska and China. We established a new sister-state relationship with Shaanxi province, highlighted the creation of a demonstration farm in Yangling, and fostered a new partnership between Tongji University and the University of Nebraska Medical Center. Preferred Popcorn of Nebraska signed a trade contract with Zhong Liang Tian Run Trading Inc with the aid of Nebraska’s Department of Economic Development.

During the 2016 trade mission, we visited Jiangsu World Group in Zhenjiang, which operates Worldlawn Power Equipment Inc in Beatrice, Nebraska. Lieutenant Governor Mike Foley also recently participated in a trade mission to China. While on the mission, Foley signed a memorandum of understanding between Hebei province and Nebraska with the goal of bettering our relationship with China.

I hope to have the opportunity to visit China again in the near future. We will continue to actively engage China and look forward to more opportunities for cooperation and mutual growth moving forward.

How would you describe the current economic cooperation, trade and investment between Nebraska and China? What are your projections for two-way investment in the years to come? What role can Chinese investment play in your efforts to improve your state’s economy?

The current cooperation between Nebraska and China in terms of trade and investment is very positive. China is one of our top trading partners, last year we exported nearly $1.3 billion worth of goods to China and imported almost $900 million worth of goods.

Even though our relationship is already good, there’s always room to grow. China recently reopened its market to American beef. Nebraska produces the world’s best beef, so I’m sure that we’ll see that market grow in the coming months. Looking to the future, I hope that more investment opportunities arise.

Any investment, domestic or international, is beneficial for both Nebraska and China. China’s economy is growing rapidly and with that growth they will want to expand their business prospects.

Nebraska is one of the best places in the world to do business; Forbes Magazine recently ranked Nebraska as the fourth-best state in America for business. Our great workforce, local work ethic, and central location greatly aid companies that do business here.

One Chinese company, Easyway International, made its first investment in Nebraska in 2008 when it established its North American headquarters in Omaha.

Alongside Easyway International, Jiangsu World Group has had a great experience in Nebraska. Jiangsu World Group recently opened a new 270,000-square-foot facility in Beatrice for Worldlawn Power Equipment Inc.

The latest available data shows that Jiangsu has invested $25 million in Nebraska and Easyway International has invested $3 million. Jiangsu’s and Easyway’s experiences are excellent reasons why companies looking to invest in America should choose Nebraska.

What is the status of sister-state-province relationships between Nebraska and China? What role can province-state-level ties contribute to further strengthening bilateral trade and economic cooperation between China and the US?

Nebraska established a sister-state relationship with Guizhou province in 2005.

Last year, Shaanxi province Governor Hu Heping and I announced a new formalized relationship between Shaanxi and Nebraska as sister states. This came together as part of a four-year effort to build partnerships and develop ties between the two states. Our relationship has been very beneficial to both Nebraska and Shaanxi. Our universities have partnered to create our Confucius Institute here at the University of Nebraska-Lincoln (UNL), as well as a joint degree program in Food Science and Technology between UNL and Northwest Agriculture & Forestry University (NWAFU). UNL and NWAFU also have growing joint research and extension programs.

The city of Omaha also has a sister-city relationship with Yantai, Shandong. The Omaha company of Valmont Industries has a large manufacturing presence in Yantai, which serves as the basis of the relationship.

Programs like these foster a shared purpose and understanding between our two countries. Growing our relationship is good in and of itself, but can also lead to other benefits such as bilateral trade agreements. As we become stronger partners we will naturally look for ways to give our partnerships more room to grow.

You have a strong business background and emphasize building a long-term relationship with China. How are you going to create a pro-business environment in Nebraska for investors, including those from China?

A long-term relationship with China is crucial to the well-being of both of our countries. As China continues to see rapid economic growth, Chinese consumers are going to want the world-class goods and services that come from Nebraska’s farmers, ranchers, manufacturers, and other producers.

Nebraska is already one of the best places to do business, so we need to ensure that it is also one of the best places to invest.

To help accomplish this I’ve been pushing for both tax and regulatory reform. Nebraska already provides tax incentives to investing companies. These incentives help ease the tax burden at different rates based on the money invested and the amount of jobs created.

What’s the current situation regarding the export of Nebraska beef to the Chinese market? What’s the status of agricultural trade and cooperation as well as agricultural research and development between Nebraska and China?

The United States has sent $17.2 million worth of beef to China. Over $8.7 million of that came from Nebraska, placing our market share at 50.5 percent. So far, Nebraska is the No 1 state for beef exports to China.

This certainly isn’t surprising to me. Nebraska has the best beef in the United States and our friends in China understand and demand our world-class quality.

There needs to be a commitment to cooperation in agriculture moving forward. The Chinese population keeps increasing along with their buying power.

One important partnership between the China and Nebraska agriculture industries comes from our irrigation companies. Nebraska produces 80 percent of the world’s center pivot irrigation equipment.

Nebraska pivot manufacturers like Lindsay Manufacturing, Reinke Manufacturing, and Valmont Industries all have operations in China.

Their products can be seen at work in the demonstration farm in Yangling. This farm, established in 2016, is helping both Nebraskans and Chinese citizens discover more effective and efficient ways to work in the agriculture industry and is helping the Chinese people gain food security.

You said in an interview in May that China’s rapidly increasing middle class presents opportunities for Nebraska. Since many affluent Chinese consumers shop for foreign goods online, how will Nebraska make use of e-commerce platforms to further promote its trade with China? What products from Nebraska can be offered to those affluent Chinese consumers?

There are already a number of Nebraska items for sale on e-commerce platforms. Just as an example, Chinese consumers can find high-quality Nebraska beef on JD.com. Nebraska produces some of the best tasting and highest quality beef in the world.

Preferred Popcorn of Fremont, Nebraska also sells their great products in China. Chinese sports fans can take their programs to the next level with Nebraska-born Hudl. Hudl is a sports analytics company that offers world-class software services for sports teams and athletes around the world.

What role can tourism play in promoting people-to-people friendship? What can Nebraska tourism offer to Chinese tourists?

According to US Travel, travel demonstrably builds bridges. In turbulent global times, travel creates deeper ties between nations and gives its citizens new perspectives. Particularly, international travelers who visit the US, whether on business or leisure trips or through a work exchange like the J-1 visa program, are 74 percent more likely to leave with a favorable impression—and return with their friends and families.

Nebraska has plenty of places for Chinese tourists to visit. It is where the rough and rugged culture of the Old West meets the beautiful wide-open spaces and sweeping vistas of the prairie. You can go horseback riding through the trails of Fort Robinson State Park, hike Chimney Rock in the Panhandle, or view the majestic sandhill crane migration.

Alongside the great outdoors, we have a vibrant city life. In Omaha we have the Henry-Doorly Zoo, which has been ranked the second-best zoo in America by USA Today readers. You can also take the time to watch a Husker football game in Lincoln.

What is the current situation of educational cooperation and exchange between Nebraska and China? How do you see future prospects for such cooperation?

Nebraska and China share numerous educational opportunities with one another.

The University of Nebraska-Lincoln (UNL) houses the Confucius Institute, which they created in partnership with China’s Ministry of Education and Xi’an Jiaotong University. The Confucius Institute promotes the learning of the Chinese language and culture in Nebraska.

UNL also has an exchange agreement with East China Normal University. Through this agreement the two universities share students, scholars, and collaboration on research. The degree-completion program that UNL shares with Northwest Agricultural and Forestry University and the partnership degree program with Zhejiang University City College allow Chinese students to study in China for two years before they apply and transfer to UNL.

Finally, UNL operates the American Exchange Center in cooperation with Xi’an Jiaotong University. This Center introduces Chinese students to US history, law, medicine, art, culture, and government. The town of Bellevue has a partnership with the Guangzhou College of Commerce. In 2017, 82 Chinese students graduated from Bellevue University as a part of this collaboration.

Partnerships between Chinese and Nebraskan universities have opened many doors for students looking to experience each other’s cultures. The current partnerships will certainly encourage our universities to expand their offerings. We have a lot to share with one another in important industries such as agriculture and manufacturing.

Warren Buffett is a business magnate and icon worldwide. In recent years, a growing number of Chinese people, many of whom are business leaders, come to Omaha for the Berkshire Hathaway annual event. How can Nebraska leverage this event to further expand its influence in other parts of the world, especially China?

Berkshire Hathaway’s annual event offers a great opportunity for their shareholders to visit with each other, learn more about their investments, and discuss how they can benefit each other further.

I had the opportunity to speak at several events during that weekend, talking with hundreds of Chinese businesspeople. I spoke with companies such as Tencent and Sina as a part of this great annual event. As Chinese citizens come to Nebraska and meet with our people, they want to invest more of their resources in our great state.

What do you think have been the major developments in economic, technology, cultural and other fields since your first visit to China a couple of years ago?

My first visit to China was in September of 2015. Looking back, quite a bit has changed since then. Many opportunities for partnership between Nebraska and China have opened up.

The largest recent development was the reopening of the Chinese beef market to American producers. As I mentioned earlier, this is a huge benefit for both Nebraska and China. China receives our world-class beef products and Nebraska has captured over 50 percent of the market for American beef in China.

China has also come a long way in the field of e-commerce since my first visit. That’s an exciting development for Nebraska companies that are looking to get their products out in front of Chinese consumers. I know that our businesses will capitalize on the opportunities presented by e-commerce moving into the future.

What has been your personal experience with this development?

During my first visit to China I had the opportunity to meet personally with Worldlawn President Hardy Shao and with Wang Weiyao, chairman of Jiangsu World Group. President Shao and Chairman Weiyao expanded Worldlawn’s operations to a 275,000 square-foot facility in Beatrice within a year of that visit.

I was able to attend the groundbreaking for the demonstration farm in Yangling. I’ve also had the opportunity to meet and speak with hundreds of Chinese businesspeople and promote investment with Nebraska.

My experience hasn’t been limited to just business, though. While in Xi’an, I was fortunate enough to see the famous Terracotta Warriors. I was amazed by this beautiful piece of China’s history.

I was also happy to meet with alumni of the University of Nebraska-Lincoln (UNL) who live in China during a visit to Hong Kong. The UNL Alumni Association and Nebraska Pork Producers hosted the Nebraska vs. Minnesota football game at a Chinese sports center.

What do you expect for the next five years and beyond?

I hope to see China continue to build on the mutually beneficial relationships that they’ve developed with places like Nebraska and elsewhere in the world.

China has much to offer neighboring countries and states, and they have much to gain in return. I expect that China’s market will continue to grow, but shift more toward consumption as the Chinese middle class becomes more affluent.

As Chinese producers and consumers continue to expand their market access and tastes, I know that they will look to Nebraska for world-class products and investment opportunities. Our great workforce, location, and business-friendly environment make Nebraska a prime location for expansion.