Kentucky governor sets an example for rest of US to follow in trade with China

From Iowa farms to Capitol Hill, the anxiety over a looming trade war between China and the United States continues unabated, as the Office of the US Trade Representative started a six-day hearing on Monday on a new round of proposed tariffs on Chinese goods.

What can US states do to reduce the uncertainties and differences between the world's two largest economies?

Kentucky Governor Matt Bevin seems to have an answer: Do whatever is possible within his gubernatorial powers to strengthen ties with China, that is, by encouraging investment.

Bevin, a Republican, also said he would adopt a seemingly detached approach to the trade conflict between China and the US, by using the knowledge he accumulated from his East Asian studies in college. That means he will help people to see what a healthy US-China trade relationship can offer.

"I would encourage all of us, West, East and otherwise, to understand it's important to be patient to work slowly to realize that we need each other," he said. "America and China are stronger as trading partners… We need each other and want this to work well."

Bevin invited Chinese Ambassador to the US Cui Tiankai to visit Kentucky last week for talks, which seem to have yielded tangible results.

At the post-talks news conference, Bevin said the tariffs are set on a level that he doesn't have direct influence on as a governor. So, he said, he cannot spend time worrying about what might happen. "What I know is I can control from the bottom up, who comes, whom we talk to, and what kind of personal… and business relationships we are establishing to ensure that no matter what happens at this level, we will continue to become stronger and closer, nation to nation and people to people," Bevin said.

Bevin cited Kentucky's advantages to Chinese journalists: energy costs and logistics convenience, as well as Kentucky's massive investment in workers' training programs, as he wants to see more Chinese companies investing in his state to create jobs in addition to the nearly 9,000 they have already created.

Cui assured him that Chinese businesses have a strong interest in the US in general, and in Kentucky in particular.

Two days after his meeting with Cui, Bevin announced that Global Win Wickliffe LLC, a Chinese-owned paper products manufacturer, will reopen the former Verso Corp mill in west Kentucky's Ballard County, with a $150 million investment which is expected to create 500 full-time jobs.

To encourage investment and job growth in the community, the Kentucky Economic Development Finance Authority said on Thursday that it has given the company preliminarily approval to get up to $25 million in tax incentives through the Kentucky Business Investment Program.

Bevin said he would like to see 200 Chinese companies employing Kentucky residents in the next two decades and emphasized that Kentucky's exports to China have a rosy future, not least because China is already Kentucky's fourth-largest trade destination.

Cui added: "Abraham Lincoln, a native Kentuckian, stands for a government of the people, by the people, and for the people. We in China now stress people-centric development. (Fulfilling) people's aspiration for a better life is our goal…."

For Kentucky, the rising number of China's middle income group, equal to almost the entire US population, means a huge market, according to Bevin. He said he would lead a delegation to attend the 2018 China International Import Expo in Shanghai in November. "It (the Shanghai expo) should excite those of us in the United States, and specifically in Kentucky, that make products, that make goods and services that the world can consume," he said.

Perhaps now, with a looming trade war, business communities need to adopt Bevin's pragmatic approach to US-China trade relations. And Bevin's contention that China and the US "need each other" and the fact that he wants "this to work well" should inspire the rest of the world to follow in his footsteps.

The author is deputy editor-in-chief of China Daily USA.