GREDA says China reward close

John R. Pulliam

GREDA Executive Director Greg Mangieri said during a public forum Thursday that although it takes time to develop relationships sufficient to attract Chinese businesses, he believes Galesburg is about to succeed.

“I think we’re at the threshold of being able to do that,” Mangieri said.

During a presentation about trips to China during October and December, as well as discussion of an upcoming trip in April, the importance of Galesburg obtaining Foreign Trade Zone status also was emphasized.

A large crowd filled the Sanderson Room on the second floor of the Galesburg Public Library. Members of the Galesburg City Council, Knoxville City Council and Knox County Board were in attendance.

Chen Guowen, consul and director of commercial section, People’s Republic of China-Chicago, made a presentation about the astounding growth of the Chinese economy. He was accompanied by Liang Gang, consul of People’s Republic of China-Chicago.

A portion of the forum was devoted to discussion of an agreement between Knox College and Beijing and Fudan universities, which will bring Chinese students and Chinese faculty here, as well as give Knox students and faculty the opportunity to study and teach in China.

Mangieri and GREDA consultant Andy Sze took it from there. They said Galesburg’s best opportunity is to attract small- and mid-sized businesses from China, because larger firms are more likely to look to the South.

“They are attracted to the southern states partly because of more favorable labor laws, partly because of incentives,” Sze said. He said China is rapidly changing into a country of entrepreneurs, with many private companies.

Mayor Gary Smith said of the smaller firms, “They’re not being offered incentives by anyone. That’s where our opportunity is, with little or no incentives at all.”

During a Power Point presentation about the October trip, as well as a summary of Hong Kong SME Expo, Mangieri sounded an optimistic note. He said many Chinese companies are interested in Galesburg, but the Foreign Trade Zone status is “crucial.”

“It’s almost a must to attract distribution of Chinese products,” he said.

Galesburg has applied to be included in an extension of the FTZ 14 General Purpose Zone in Peoria. FTZ status means companies sending goods from China to the U.S. would not pay duties on the products until they were sold.

“It can remain at a Foreign Trade Zone basically forever, until it’s moved out for retail sale,” Mangieri said.

“Once we get the FTZ status in Galesburg, it will make the appeal of the city much stronger,” Sze agreed.

Mangieri said the application for the extension of the FTZ is finished and is now in the hands of the consultants.

“We should have a schedule to make a presentation within three weeks of when they get done, which we hope will be in a week or two,” he said.

Mangieri and Sze said Chicago is being overloaded by container traffic, giving Galesburg an opportunity.

“Chicago, if the railroad facility could hold all the containers ... the Chicago highway infrastructure won’t,” Mangieri said, adding that is why the Union Pacific built a large intermodal facility in Rochelle, about 80 miles west of the Windy City.

“That puts us in a pretty good situation,” Mangieri said of Chicago congestion.

Galesburg Alderman Ken Goad, Ward 1, asked about competition. Sze admitted there are plenty of Chinese suitors dotting the landscape.

Sze said he ran into representatives from Missouri, New Mexico, North Carolina and other states in Hong Kong. There also is Illinois competition.

“Certainly Quincy, they have sent several delegations to China and Rockford is actively doing that,” he said.

Chicago has opened its own trade office in China, Sze said.

One man asked about sending corn, soybeans and other agricultural products to China in empty containers. Mangieri said GREDA is working on that.

“We’re reluctant to go into a great deal of detail about that, because we’re in competition with every city in the Farm Belt,” he said.

“There’s a large potential for that and that’s something that is right up Greg’s alley,” Smith said.

Unlike early GREDA forums in which the crowd at time became contentious about the “China Initiative,” the audience Thursday listened intently. However, initially no one asked questions when the opportunity arose. After a GREDA board member or two in attendance asked Mangieri to elaborate at points raised during the forum, other members of the crowd began to participate.

Mayor Smith, in his closing remarks, addressed the sometimes thorny issue of funding. He said Mangieri, on a full-time basis, and Sze, part time, are handling just about every aspect of the China effort.

“This is the total importance of funding,” the mayor said. “You’re limited by your resources as to what you can do. ... This is the perfect example, you have to spend some money to make some money.”

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