Tractus Executive Director Presents Case Studies on Successfully Attracting Investment into North America from Asia at the 2017 Annual Site Selectors Guild Conference
Attracting investment from Asia requires an unconventional approach that uses export opportunities as a way of identifying investment targets.
Tucson, Arizona USA 26 March 2017 – Tractus Asia Limited’s Executive Director and member of the Site Selectors Guild, Dennis Meseroll, participated in a panel discussion on International Investor Perspectives on opportunities for investment in North America, at the Site Selectors Guild’s annual conference in Tucson, Arizona, USA.
In 2016, inbound investment into the US continued its rapid growth reaching US$100 billion for the first time. While strict capital controls imposed by the Chinese government in late 2016 will impact investments in 2017, the government has stated its intention to ease these controls in the fourth quarter of 2017 or early 2018. Mr. Meseroll noted that, “Chinese outbound investment in the current 5-year plan (2016-2020) is focused on upgrading China’s industrial infrastructure to improve productivity and efficiency to offset rising costs and improve the environment and healthcare services for the benefit of the ordinary Chinese citizen”. Investments are being directed into biopharmaceuticals, advanced materials, aviation & aerospace, automation & robotics, medical devices and food safety and traceability. While outbound FDI from China has expanded at a rapid pace, over 95% of it continues to be M&A versus Greenfield investments; not unusual given the minimal experience most Chinese companies have in international investments and their eagerness to invest and quickly gain a foothold in the market.
Identifying investment opportunities compatible with a region’s investment attraction focus, requires an unconventional approach that links opportunities for exporting to China (and Asia) with sectors, subsectors and market segments requiring capital or Greenfield investments. Mr. Meseroll described a case study from the state of Maine, which Tractus represents in China, as an excellent example of this unconventional approach. The state of Maine invited Chinese buyers of lobsters attending the Boston Seafood Show to visit Maine to meet directly with lobstermen and processors with experience in exporting. They discovered that while there was sufficient lobsters for export, there was insufficient flash freezing capacity to process the lobster such that it could be more easily shipped by sea in larger quantities, than by more expensive air freight used for live lobsters.
Chinese buyers expressed interest in investing in expansions of the existing flash freezing cold chain capabilities already in place and discussions are continuing between these buyers and the lobster processing companies. “. . . the state of Maine was smart in bringing potential buyers of lobsters (and other seafood) to visit the state so they could meet with suppliers of export product, but also understand what investment opportunities there might be in the export product value chain”, noted Meseroll.
Other panelists addressed opportunities for attracting research and development (R&D) investments from Europe as well as their experiences promoting investment into North America from the world’s regions.
Tractus Asia Limited (www.tractus-asia.com) is an Asia-based foreign direct investment strategy and execution advisory firm with offices in Shanghai, China; Chennai, India; Jakarta, Indonesia; Yangon, Myanmar; Singapore; Bangkok, Thailand and Ho Chi Minh City, Vietnam. Tractus advises and assists corporations develop effective market entry strategies and assists them throughout the execution process, including site selection, real estate transactions and investment incentives negotiations to corporate establishment and start-up management. For global economic development organizations, Tractus provides export promotion and investment attraction representation services throughout Asia.
The Site Selectors Guild (www.siteselectorsguild.com) is the only association of the world’s foremost professional site selection consultants. Guild members provide location strategy to corporations across the globe and for every industry, sector, and function. Founded in 2010, the Site Selectors Guild is dedicated to advancing the profession of international corporate site selection by promoting integrity, objectivity, and professional development. Members are peer-nominated, vetted, and must demonstrate a significant amount of location advisory experience. Guild Membership is the highest standard in the site selection industry.