News

MWTC E-News

June 13, 2007

1. Schedule One-On-One Meetings with Canadian Trade Commissioners after MWTC’s Luncheon June 25 (RSVP by June 18)

2. Does your Montana startup idea qualify for a $10,000 Advertising Grant? (compliments of http://www.matr.net)

3. SBA now is focusing on rural America (compliments of http://www.matr.net)

4. The Role of Market Research in Technology Development and Commercialization (Seminar June 27, 2007 in Bozeman)

5. Commerce Department Enlists Consumers in the Fight against Fakes (compliments of ITA Newsletter)

6. Increasing U.S.–Mexico Competitiveness: The Way Forward (compliments of ITA Newsletter)

7. U.S. Commercial Service Focuses on China’s Second-Tier Cities (compliments of ITA Newsletter)

8. Market Research: Getting Paid by Your Latin-American Buyer

9. Excerpts: Western United States Agricultural Trade Association (WUSATA) Spring 2007 Newsletter

1. Schedule a One-On-One Meeting with Canadian Trade Commissioners after MWTC’s Luncheon June

MWTC’S INTERNATIONAL BUSINESS LUNCHEON:

INCREASING CROSS BORDER TRADE AND INVESTMENT BETWEEN MONTANA AND CANADA

Montana State Flag

June 25, 2007
11:30am to 1:00pm: Lunch Presentations by Canadian Trade Commissioners and Honorary Consul Shirley Ball

1:15pm to 3:45pm: One-on-one meetings with Trade Commissioners (limited spots so confirm ASAP)
Location: Gallagher Business Building, The University of Montana (Missoula), Room L09

Cost: FREE for MWTC members
$10.00 for Non-members

RSVP by June 18, 12007

Canada is Montana’s most important trading partner with more products shipped to our neighbor to the north than to all other foreign markets combined. Information and communication technologies, energy and environment, defense/ aerospace/ space, agriculture, and life sciences are among the principal trade relationships. In 2005, Montana’s exports to Canada were valued at $354 million, and trade with Canada supported 16,000 Montana jobs.

Please join Canada’s Senior Trade Commissioner, Monica Heron, Honorary Consul of Montana, Shirley Ball, and the international trade staff of the Canadian Consulate General-Denver for a presentation on how your company can partner and do business with Canada. Trade Commissioners will cover the following key priority sectors (a full bio on each specialist is included at the bottom of this email):

Agricultural Advocacy and Agricultural Specialist – Kim O’Neil

Bioscience – Stephen Davis

Information Communication Technology and Building Products – David Smith

Energy, Mining, and Environment – Stan Pence

Aerospace and Defense /Space – Philippe Taillon

Please contact Megan Harrington ([email protected]/406.243.5850) to confirm your participation and arrange a 30-minute one-on-one meeting. Individual meeting times are limited, so please confirm your time slot ASAP.

Trade Commissioners

1.) Shirley A. Ball, Honorary Consul of the State of Montana

The daughter of Elmer and Bernice Nybakken, Shirley was born and raised in Valley County in northeast Montana on a farm that was homesteaded in 1916 by her paternal grandmother. Her maternal grandparents were also homesteaders who came to Montana from Canada, where her Mother was born. A life long farmer, Shirley and her late husband, Merlin, raised spring wheat, barley, cattle and hay together in their farm in the Nashua area for over 45 years. The land is currently leased out.
Shirley is interested in community and state issues and has served on a number of committees, including economic development groups, energy groups, credit union, and as an officer in WIFE (Women Involved in Farm Economics) a national farm organization. As a WIFE member, she was an invited speaker at a Saskatchewan Women’s Agriculture Network convention on trade issues in the late 1980’s.
During the oil embargoes in the 70’s Shirley became interested in ethanol production as an additional market for grain. Shirley has remained interested in ethanol fuel and the DDG and has worked in many capacities to promote the products. In 1987 she was appointed to a USDA panel to “Study the Cost Effectiveness of Ethanol” and she served on the Montana Renewable Energy Advisory Council for four years. Since 1991 she has been the Executive Director and President of EPAC (Ethanol Producers And Consumers ) a national non profit membership organization that educates about ethanol.
Shirley was an elected member of the county committee for Farm Service Agency before being appointed in 1992 to the state committee, where she served for eight years. She served a three year term on the advisory council for Small Business, Labor and Agriculture with the Regional Federal Reserve Bank in Minneapolis. She is currently a member of the Valley County Planning committee and the Nashua Lions Club.
Shirley has three children, and seven grandchildren.

2.) Monica Heron, Consul and Senior Trade Commissioner

Monica Heron is currently with the Consulate General of Canada in Denver as Consul and Senior Trade Commmissioner. Her last posting was in Bogota, Colombia where she was Counsellor (Commercial) for three years .

Monica has served in Ottawa in the Western Europe Trade and Investment Development Division, in the Trade Commissioner Service Strategic Planning Division, and as Deputy Director of the Central Europe Division. Her postings have taken her to Berne, Switzerland as First Secretary (Commercial) and Consul; Harare, Zimbabwe as Counsellor (Commercial); Abidjan, Ivory Coast as Counsellor (Commercial) as well as the African Development Bank Liaison Officer; Dublin, Ireland as Counsellor (Commercial) and Hong Kong, China as Counsellor (Commercial). Monica was born in Toronto, Ontario and graduated from Carleton University in Ottawa , Ontario with a BA.

3.) Kim O’Neil, -Agricultural Advocacy and Agricultural Specialist

Kim O’ Neil is Consul, Agriculture Specialist at the Consulate General of Canada in Denver since August 2006. Kim was previously posted to Mexico City from 1999-2004 as Agriculture Counsellor. On return from Mexico she was Special Advisor on Canada –U.S. Advocacy in Agriculture & Agri-Food Canada International Trade Policy Division. Prior to her time in Mexico, she worked in Ottawa in the Mexico Division of the Department of Foreign Affairs and International Trade and as Mexico Desk Officer in Agriculture and Agri-Food Canada. She was Legislative and Special Assistant to the Minister of Agriculture and Executive Assistant to various Members of Parliament in the House of Commons for seventeen years.

Other Languagues:

Spanish

French

4.) Stephen Davis, Trade Commissioner-Bioscience

Stephen joined the consulate in March of 2005. Prior to that time he held international trade positions in several Colorado companies including Current, Inc., one of Colorado’s top 5 largest importers measured by volume of goods, Gerry Baby Products, and NatureSmart, a nutraceutical manufacturer owned by Wholefoods Markets. These positions afforded Stephen the opportunity to travel extensively throughout Asia and to specialize in managing trade relations with manufacturers of raw materials and finished goods from all over the world.

Stephen received a Bachelors of Science in Religion and Philosophy from Texas Wesleyan College, in Fort Worth, Texas and a Masters of Science in International Business from the University of Colorado, in Denver, Colorado.

His language skills include earning a certification in Chinese language studies from the University of Denver, a level two certification in American Sign Language from the Pikes Peak Center on Deafness and speaking Khmer (Cambodian) at a basic conversational level.

Stephen has lived in Colorado for the past 23 years with the exception of 16 months spent living in rural Cambodia, while volunteering with the International Human Rights Law Group and 3 months living at the Ichihara Elephant Kingdom in Ichihara, Japan.

5.) David Smith, Trade Commissioner-Information Communication Technology and Building Products

David Smith is the Business Development Officer responsible for the Information Technology/Communication industry sectors for the Consulate General of Canada located in Denver. David is responsible for Canada-U.S. trade/commerce relations in the states of Colorado, Utah, Montana, and Wyoming.

Prior to joining the Canadian Consulate, David worked for PeopleSoft implementing business software solutions for both U.S. and Canadian clients. David has also trained more than 300 end users in the financial and distribution software modules. Prior to his experience at PeopleSoft, he worked for Georgia-Pacific as a lumber buyer for softwood lumber products from Canada.

David received his Masters of Business Administration in International Business from the University of Colorado, and received a Bachelor of Science degree in Marketing from Brigham Young University. David is also bilingual in French and English after having spent two years living in Belgium and France.

6.) Stan Pence, Trade Commissioner-Energy, Mining, and Environment

Stan Pence is the Trade Commissioner responsible for the Energy, Mining and Environmental industry sectors for the Consulate General of Canada located in Denver. Stan is responsible for Canada-U.S. trade/commerce relations in the states of Colorado, Utah, Montana, and Wyoming. His primary focus in on the extractive industries, concentrating on developing commercial links between Canadian and US businesses along the “Rocky Mountain Corridor” from the Artic to New Mexico.

Prior to joining the Canadian government, Stan worked for Xcel Energy in Denver for the company’s corporate finance and energy trading divisions. He has a trading background having spent a decade in New York working for a number of Wall Street firms in fixed-income sales.

Stan received his Masters of Business Administration in Finance from Boston University, and received a Bachelor of Science degree in Economics and French from the University of California at Berkeley. He also attended the Ecole des Hautes Etudes Commerciales in Paris, a leading French business school and is bilingual in French and English.

7.) Philippe Taillon, Vice Consul and Trade Commissioner-Aerospace and Defence

Philippe Taillon is Vice Consul and Trade Commissioner responsible for the investment program and the aerospace and defence sectors for the Consulate General of Canada in Denver since August 2006. Philippe, along with his colleagues at the Consulate, is responsible for Canada – U.S. trade/commerce relations in the states of Colorado, Utah, Montana and Wyoming.

Prior to joining the Consulate, Philippe was an advisor at Canada Economic Development for the Quebec region since 2002. He graduated in 2001 with a Bachelor’s Degree in Business Administration.
2. Does your Montana startup idea qualify for a $10,000 Advertising Grant? (matr.net)

June 4, 2007

You could qualify for a $10,000 Advertising Grant Do you have an idea for a new business that won’t go away? Do you see yourself building a new and different life? Maybe all you need is someone to give you a hand. Maybe all you need is someone who believes you can do it. Maybe all you need is a mentor. That’s what the Bresnan Business Incubator is all about. Our company believes in the power of entrepreneurship. We know what it means to start small and move forward. We know the important contributions even the smallest of businesses can make to the life of a community. We know because we started that way ourselves. Now we’d like to help you do the same.

Working in partnership with Montana’s regional economic development organizations and your community’s Small Business Development Center, Bresnan will provide grants and other financial incentives to help you turn that idea into a business. With our proven skills in communications, advertising and marketing, we will help you promote your fledgling business and provide a boost during its crucial early stage. We will share our knowledge and experience and add a big dose of encouragement along the way. Let the Bresnan Business Incubator transform your idea into a success story. With the State of Montana and Bresnan behind you, you’ll be off to a flying start.

Full Information: http://www.bresnanbusinessincubator.com/

3. SBA now is focusing on rural America (compliments of http://www.matr.net)

By Brice Wallace
Deseret Morning News

LOGAN — Only 10 months into the job, the leader of the U.S. Small Business Administration is having the agency concentrate on pushing its programs into communities with high unemployment and poverty rates, many of them in rural areas.
"I believe that driving successful and sustainable business formation into those underserved markets can change the game for millions of Americans by bringing jobs, by bringing economic activity and investment to areas of our country where they have often been in short supply," Steven C. Preston, administrator of the SBA, told a group at the Rural Business Conference in Logan Thursday.
"We want to play a greater role in harnessing that power of entrepreneurial capitalism to transform those rural communities in America by creating proactive partnerships at all levels of government, as well as the private sector."
But Preston acknowledged that because of the diversity of rural communities, "there is no single recipe to get after the issue."
Still, the SBA is expanding its presence in rural America by lending capital in areas typically avoided by traditional venture capital companies. He noted that the number of SBA loans to rural small businesses tripled during the past four years.
"Now, much of that has been due to the expansion of the larger banks, so now we’re working very hard to figure out how to reach out to community banks that are so committed to the areas they serve," he said.
The SBA’s rural outreach also has featured new goals for every district office to drive capital into high-unemployment and high-poverty areas. "All of our rural markets will have strategic outreach programs specifically for lending," he said.
The agency has increased offices’ travel budgets, added 19 "alternative work sites" to 83 district and branch offices and has started offering training online.
Preston said foreign markets are "more open than ever before," with small businesses taking advantage. They also have been helped by the Internet.
"One of the things that is most encouraging is, in so many ways, the playing field is leveling for rural America," he said. "The proliferation of the Internet has simplified the ability to communicate, to market, to find buyers to online clearinghouses and to transact. And it’s cheap. Every business looks like a big business online."
The country’s economic success is driven by small-business owners, he said.
"Entrepreneurialism is in our national DNA. It’s an underpinning of our country’s greatness, and the spirit of entrepreneurialism and small-business ownership is essential as a country. Small business drives innovation that keeps us competitive, it provides opportunity for many Americans who might not find it elsewhere, and it enables transformation in communities in our country that need economic revitalization, many of which are the rural communities in our country."
The SBA has helped by extending or guaranteeing more than $80 billion of capital with small businesses and homeowners. Last year, more than 100,000 small businesses received capital through the SBA, whose lending programs have doubled since 2001. The agency provided training and counseling services to 1.5 million people last year, and its Web site had 26 million hits.
But Preston spoke of more than just statistics. He talked about the power to change communities.
"As you think about where to locate, where to hire, where to invest, always think about the impact you’re having on your communities, because small businesses are the ones that are the first movers and the most energetic movers when we see community transformation in our country."
He recalled seeing a small grocery store being cleaned and preparing to open in a vast, devastated area of New Orleans.
"These guys are the first movers. They’re providing essential services to people who are going to move into this place. They’re the ones sticking out their chins, taking the risks, putting everything they had at stake because they believe in it. It’s who they are, and it is one step in enabling the transformation in that community," he said.
"But I think that one little picture is what we see across our country when we see communities transforming."
4. The Role of Market Research in Technology Development and Commercialization (Seminar June 27, 2007 in Bozeman)
9:30 to 11:30 a.m.
Bozeman, MT
Western Transportation Institute Conference Room A
2310 University Way

Markets for a new technology emerge when the technology’s unique features, capabilities, and benefits are deemed to be superior to those of existing technologies. Failing to understand and be able to present the technology in terms of its specific features, capabilities, and benefits usually means a much longer and more difficult road to commercialization. This seminar examines the importance of seeing a technology as a product to be sold and explains how staged market research should be performed, parallel to the development of the technology itself, to ensure the market’s needs are always at the forefront. When performed well, effective market research will substantially improve the chance of successful commercialization, because it focuses on the technology as a response to a need. Attendees should expect to leave with a better understanding of how market research can improve their commercialization prospects, as well as the tools and capability to perform much of the research themselves.

Cost: $55

Registration: https://app.mt.gov/cgi-bin/confreg/register/index.cgi?CONFERENCE_ID=1021

Linda Brander
Montana Technology Innovation Partnership
301 South Park
POB 200505
Helena, MT 59620-0505
Phone: (406) 841-2749
Fax: (406) 841-2728
http://www.mtip.mt.gov

5. Commerce Department Enlists Consumers in the Fight against Fakes (compliments of ITA Newsletter)

A consumer awareness campaign launched in April asks the public to think twice about the consequences of counterfeiting and piracy, and it provides steps to keep fakes off the shelves and out of our homes and businesses.

by Amanda D. Wilson

A campaign to increase consumer awareness of the damage that fake products and violations of intellectual property rights (IPR) can cause U.S. consumers and the economy in general was launched on April 11, 2007, at an event held at the U.S. Department of Commerce in Washington, D.C.

David Bohigian, assistant secretary for market access and compliance in the International Trade Administration, joined a group of six government officials and private-sector representatives to deliver the message that consumers have a role in the fight against counterfeiting and piracy. The organizations that were represented include France’s National Institute for Intellectual Property, the U.S. Department of Commerce, the U.S. Consumer Product Safety Commission (CPSC), and the U.S. Chamber of Commerce. Among the speakers were Jon Dudas, director of the U.S. Patent and Trademark Office, and Jean-David Levitte, ambassador of France to the United States. A panel of distinguished speakers described the risks posed to consumer safety and the U.S. economy.

Piracy Not a Victimless Crime

According to industry reports, counterfeiting and piracy cost the U.S. economy between $200 billion and $250 billion per year, and they are responsible for the loss of 750,000 American jobs. Every product in every industry is vulnerable, from everyday household items (such as DVDs, CDs, sunscreen, and prescription drugs) to mechanical goods (such as batteries, car parts, and electrical equipment). Since the early 1990s, trade in counterfeits has grown at eight times the rate of legitimate trade. Counterfeit-related seizures by the U.S. Customs and Border Protection rose 80 percent from 2005 to 2006 alone.

Once viewed as a victimless crime, the sale of these defective and dangerous goods is now recognized in the international trade community as having far-reaching consequences for lives and for the economy. Both the U.S. government and private industry have stepped up the protection and enforcement of IPR by streamlining the supply chain, educating businesses about their rights, and putting increased pressure on governments that turn a blind eye to this illicit trade. Experts recognize, however, that as long as there is demand for fake products, organized counterfeiters and pirates will find a way to supply them.

U.S. Government Teams Up to Protect Consumer Safety

Thomas Hill Moore, commissioner of the CPSC and a participant in the April panel, addressed the risk posed to consumers by counterfeit and pirated goods. “Counterfeit products are sold at discounted prices, but for consumers looking to save a couple dollars, that discount could be a disaster,” Moore explained. “These products may falsely bear the brand of a reputable company or the label of a respected testing laboratory, or both.”

Moore highlighted the first collaboration on counterfeiting between the CPSC and U.S. intellectual property agencies. He noted that in recent years, the CPSC has recalled more than 1 million counterfeit products.

The CPSC also routinely works with U.S. Customs and Border Protection to identify and stop the import of unsafe products at U.S. ports. CPSC officials report that half of the unsafe products that the commission recalls originate from China. In an effort to improve the safety of products being exported to the United States from China, the CPSC in April 2004 signed a memorandum of understanding with its Chinese counterpart, the General Administration for Quality Supervision Inspection and Quarantine. On May 21–22, 2007, Nancy A. Nord, acting chairman of the CPSC, traveled to Beijing to participate in bilateral talks that are a part of the agency’s continuing efforts in this area.

The International Trade Administration is working closely with the CPSC to ensure that the consumers and businesses that fall victim to trade in counterfeit goods can benefit from shared information about dangerous products entering the market.

STOP! Activities Detailed

Chris Israel, national intellectual property enforcement coordinator, and Caroline Joiner, executive director of the U.S. Chamber of Commerce’s Global Anti-Counterfeiting and Piracy Initiative, represented government and industry experiences with the Bush administration’s Strategy Targeting Organized Piracy (STOP!). They illustrated to the April 11 event’s audience a side of counterfeiting that consumers often overlook.

Israel gave examples of counterfeiters and pirates who deal in seemingly innocuous products but are found to have links to drug trafficking, arms trafficking, illegal immigration, and terrorism. “Counterfeiting networks can be seen as a mass production industry,” said Israel. “Factories in developing regions are using leading-edge technology to manufacture fake products.”

Joiner presented staggering figures of the blow dealt by counterfeiting and piracy to the U.S. economy. The U.S. auto industry has lost $3 billion to fake auto parts; U.S. pharmaceutical companies face losses of $32 billion a year; and the appearance of pirated DVDs before movies have even reached theaters results in more than $800 million in lost tax revenue. Each of those dollar figures has corresponding consequences for the country’s ability to maintain or create new jobs. Small businesses face perhaps the toughest challenge, because one counterfeiter can be devastating to a company trying to grow or just maintain an established clientele.

French Efforts Exhibited

The program also showcased the Department of Commerce’s partnership with France’s National Intellectual Property Institute, which provided an exhibit of the consumer awareness campaign it recently launched in France, “Counterfeiting, No Thanks.”

Amanda D. Wilson is an international trade specialist in the Department of Commerce’s Office of Intellectual Property Rights.

6. Increasing U.S.–Mexico Competitiveness: The Way Forward (compliments of ITA Newsletter)

A visit to Mexico by Franklin L. Lavin, under secretary of commerce for international trade, highlighted important issues that will enhance the relationship between the United States and its second-largest export market.

by David Levey

As the trading relationship between Mexico and the United States approaches a rate of $1 billion per day, the economic connection between the two countries continues to grow richer and more complex. In recognition of this relationship, and to catalyze further growth, Franklin L. Lavin, under secretary of commerce for international trade, visited Mexico on May 7–10, 2007, to meet with business leaders and government trade officials.

In 2006, the United States was Mexico’s largest trading partner. For the United States, trade with Mexico is larger than trade with all of South America, Central America, and the Caribbean combined (with enough left over to also include all trade with India). Put another way, U.S. trade with Mexico today is as large as our trade with the entire world 30 years ago.

Growth and Competition

Although there is much to celebrate in the trade and economic progress between the two countries that has been made in recent years, Lavin remarked during his visit that competition from other regions of the world continues unabated. Neither Mexico nor the United States can be satisfied with what they have accomplished so far.

Speaking at the American Chamber of Commerce in Mexico City on May 8, 2007, Lavin noted, “Mexico’s middle class has grown significantly since the North American Free Trade Agreement [NAFTA] was put into force, with nearly 10 million households—40 percent of the population—part of the middle class today. More Mexicans own their own homes today than ever before, a sign that a vibrant domestic consumer market for imported goods is being created. Indeed, Mexico today is the second-largest export market for the U.S.“

This growth is due, in large part, to a dramatically improved business environment in Mexico. In a recent report, Doing Business 2007: How to Reform, the World Bank ranks Mexico as one of the world’s top three economic reformers among the 175 countries it measured. According to the report, Mexico jumped more than 20 rankings, and it now ranks favorably with economies such as Spain and Taiwan. This change is quite an improvement from 20, 10, or even 5 years ago.

Factory Visit Highlights Challenges

According to the World Bank, one of the regions that is most open for business is the central Mexican state of Querétaro, which is located about 120 miles north of Mexico City. Lavin visited the city of Querétaro on May 9, 2007, touring a state-of-the-art glass making facility for Guardian Industries. In a speech to Querétaro’s business leaders, Lavin remarked that the United States has to improve border crossings, to update trucking rules, to enact immigration reform, and to extend the benefits of free trade to other nations in the Western Hemisphere. Passage of the pending free trade agreements already negotiated with Colombia, Panama, and Peru is also an important priority for the Bush administration.

Trade Barriers and Rule of Law

During his time in Mexico, Lavin raised a number of issues with his Mexican hosts. In his remarks in Querétaro, he pointed out that “one barrier to trade that remains [is] redundant testing and certification procedures. For example, Mexico has not yet authorized foreign testing bodies in keeping with NAFTA obligations. . . . This results in unnecessary retesting and recertifying of electrical products.”

Another challenge is the need to increase the effectiveness of the rule of law. Lavin remarked, “I have heard from a number of companies [that] want reassurances that commercial disputes will be addressed through civil proceedings. They want to know they will not be subjected to criminal charges if their company has a civil dispute with a Mexican entity.”

Intellectual Property and Market Liberalization

A related legal issue is the protection of intellectual property rights (IPR). “Strong IPR protection will help spur investment in high technology in Mexico and will give Mexicans an incentive to innovate,” noted Lavin during his visit. “President Felipe Calderón has taken a number of important, positive actions regarding a wide variety of rule of law issues, but these initiatives need to now be implemented.”

Mexico can take other steps that would improve the lives of its citizens, such as liberalization in the telecommunications and broadcasting sectors. A competitive broadcasting sector, for example, would provide more content choices for Mexican consumers and would spur innovation. Competition in cell phone service, which is currently a monopoly, would encourage innovation and lower prices. Mexicans now pay some of the highest rates in the world for fixed-line telephone service, and the rates for international and cellular service are about six times the U.S. average.

None of these policy and market issues detract from Mexico’s impressive economic achievements or from the great strides that the United States and Mexico have taken together. “There is cause for optimism—both because of how far the two countries have come in such a short period of time and because of the commitment shown by the leadership of both countries to advancing our relationship as partners, neighbors, and friends,” said Lavin.

David Levey is a writer in the International Trade Administration’s Office of Public Affairs.

7. U.S. Commercial Service Focuses on China’s Second-Tier Cities (compliments of ITA Newsletter)

Fourteen of China’s second-tier cities account for 8 percent of China’s population but 53 percent of its total imports, which is why the untapped markets of China’s emerging cities provide some of the most exciting and lucrative opportunities for U.S. exporters.

by Nicholas Monsees

To help U.S. exporters reach China’s emerging markets, the U.S. and Foreign Commercial Service (USFCS) has expanded the scope of its operations to include several of China’s fastest-growing second-tier cities. USFCS now offers its services in 14 key regional hubs and emerging markets across China through its American Trading Center (ATC) program. With access to a broad cross-section of contacts, including potential agents and distributors, major end-users, and key government officials, the new initiative by USFCS has been helping U.S. companies meet the right people at the right levels to expand their businesses.

China’s Real Economic Engine

China’s unprecedented growth and the opportunities it presents are no longer a secret in the business world. Although megacities, such as Beijing and Shanghai, have long captured much of the spotlight, it is behind the scenes, in second-tier cities, where one can witness the real source of China’s economic growth. Contrary to expectations, the majority of China’s imports are not ending up in Beijing, Guangzhou, or Shanghai. Rather, a select group of 14 second-tier cities—Chongqing, Dalian, Hangzhou, Harbin, Kunming, Nanjing, Ningbo, Qingdao, Shenzhen, Tianjin, Wuhan, Xiamen, Xian, and Zhuhai—account for an astonishing 53 percent of China’s total imports, almost double the amount of the three Chinese megacities combined.

Local entrepreneurs in those emerging cities are not the only ones reaping the benefits. Those cities have become importing havens, and they present lucrative opportunities, especially for U.S. companies. Perhaps the critical question for U.S. firms is not whether there is a second-tier city market, but which city is best for a particular industry or product.

On-the-Ground Assistance

One of the ways that the USFCS is helping U.S. companies meet potential buyers from emerging markets is by assisting them in promoting their products at trade shows in China. The USFCS offers preshow marketing assistance and briefings, as well as access to prime locations on the exposition floor as part of a “pavilion” of American companies. A spokesperson for Vweb, an exhibitor in the U.S. pavilion at the China Consumer Electronics Show (SINOCES) 2006 in Qingdao, describes how the USFCS helped introduce the company’s products into the Chinese market. “The connections, press coverage, and customer visits from SINOCES are producing good results for us, and our sales in China are growing very fast. We expect our sales in China will grow more than 100 percent next year.”

Information Technology Imports on the Rise

Success stories such as Vweb’s are not uncommon, especially for U.S. firms involved in China’s booming information technology (IT) sector. As China strives to diversify its manufacturing base and to move its way up the value chain, few industries show more potential for growth than IT. Much of this explosive growth is happening in the second-tier cities, with some even surpassing that of Beijing, Guangzhou, and Shanghai. One emerging city in particular, Shenzhen, has become a leading importer of IT goods.

Shenzhen: A Leader in IT Imports

Shenzhen, located in the southern Pearl River delta just across the border from Hong Kong’s New Territories, has been one of the fastest-growing cities in the world since its opening in the late 1970s. Once a small fishing village, Shenzhen is now the largest manufacturing base in the world and the hottest market for IT goods in China. Shenzhen’s growth in the sector is phenomenal, dwarfing that of Beijing, Guangzhou, and even Shanghai. The city now imports more integrated circuits and electrical components than any other city in China. Since 2000, Shenzhen’s annual imports of foreign electrical components and integrated circuits have grown by an astonishing 520 percent and 720 percent, respectively.

Sustained Growth Foreseen

Experts forecast that growth in the second-tier cities will remain strong in the coming years. What makes those emerging markets even more attractive for U.S. exporters is that they have a lower level of saturation and competition than their first-tier counterparts. Moreover, as the ranks of the middle class in those emerging markets continue to swell, so will the demand for foreign goods. The combination of those factors will continue to make second-tier cities one of the best opportunities for U.S. companies to expand their businesses in China.

Nicholas Monsees is an international trade assistant with the Department of Commerce’s U.S. and Foreign Commercial Service.
8. Market Research: Getting Paid by Your Latin-American Buyer

Mexico, Getting Paid by Your Latin-American Buyer

http://buyusainfo.net/docs/x_1197802.pdf

To the best of our knowledge, the information contained in the reports listed on this page is accurate as of the date published. However, The Department of Commerce does not take responsibility for actions readers may take based on the information contained herein. Readers should always conduct their own due diligence before entering into business ventures or other commercial arrangements. The Department of Commerce can assist companies in these endeavors.

9. Excerpts: Western United States Agricultural Trade Association (WUSATA) Spring 2007 Newsletter

Branded Seminars

WUSATA will be providing seminars on the Branded Program, along with application workshops and Export Readiness Training this next year. Be sure to mark your calendars to attend one of the following seminars or training sessions. Full information on the seminars, workshops, and training sessions will be posted to the Events Calendar on WUSATA’s website (www.wusata.org)

Upcoming Branded Seminars

June 12 Idaho Export Readiness Training

June 19 Nevada Export Readiness Training and Branded Program Seminar

June 20 Nevada Branded Program Seminar

July 16 Colorado Export Readiness Training

July 17 Colorado Branded Program Seminar

July 25 New Mexico Export Readiness Training

July 26 New Mexico Branded Program Seminar

August 15 Hawaii Branded Program Seminar

Important Dates

September 1, 2007 Pre-Qualification open for 2008 Online Branded Application

October 1, 2007 Deadline for 2008 Branded Application

December 31, 2007 2007 Program year ends

January 1, 2008 Program year begins

February 28, 2008 Final Claim and on-line survey due for the 2007 program year

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