CA Governor Visits China for Trade Mission
Asia Society Study Cited
California has a reputation for being forward thinking, in business as well as food, architecture, and lifestyle. The Bay Area, especially Silicon Valley, is known for being at the forefront of innovation in fields including computer science, biotech, and sustainability. As China works to build its own high-tech presence, it is only natural that it turns its attention, and investment dollars, to the Valley.
The 2012 Asia Society report, Chinese Direct Investment in California is once again in the news. Governor Jerry Brown visited China last week in hopes of strengthening economic ties, and the Asia Society report was front and center.
Governor Brown and China's Ministry of Commerce apparently read the report carefully, both citing our estimate that California could bring in between $20 and $60 billion in new Chinese inflows by 2020.
Earlier this week, Brown announced a Chinese-backed $1.5 billion deal to transform Oakland’s waterfront. He was ebullient in Wednesday’s S.F. Chronicle, saying, "This massive influx of Chinese investment will put thousands of Californians to work and dramatically improve Oakland's waterfront."
Brown’s sentiments also served to underscore the challenges that Chinese investments can face. Such was the case on Friday, when a $1.7 billion Chinese investment deal to construct homes on Treasure Island collapsed. China may have the potential to help revitalize California’s economy, but doing so will not be easy and will require concerted effort and revamped engagement.
Meanwhile, ASNC’s Executive Director N. Bruce Pickering spoke to the Huffington Post about Governor Brown's trip to China. He criticized California, saying that compared to other states, California has made little effort to create a welcoming atmosphere for Chinese investors. Californians may be known for their innovative spirit and cutting-edge technologies, but those are not always enough to woo Chinese investors. The state can be arrogant about its strengths, and needs to do a better job connecting with the outside world.
Also in an S.F. Chronicle op-ed on April 10th, Pickering noted, "Chinese investments in California could mean creation of new jobs, many high paying and requiring advanced degrees," a sentiment Brown reiterated. Pickering believes California has the most to gain from Chinese investment and is well placed to capitalize on Chinese interest.
Click here for another story on Governor Brown’s visit in last week’s Economist.