China could invest $2 trillion worldwide over the next decade, according to a study, and the city of Toledo -- already with a $2.15 million head start -- is sending strong signals that it wants more.
On Wednesday, Mayor Mike Bell and his top economic development official were introduced to another delegation of Chinese investors. They were brought into the mayor's 22nd-floor suite downtown by Perrysburg real estate broker Scott Prephan, who already has connected the city with two investors from Shenzhen, China, named Yuan Xiaohona and Wu Kin Hung, who bought the Docks restaurant complex for $2.15 million.
Also this week, Ohio Gov. John Kasich, while speaking about his administration's economic development initiatives in Perrysburg at a luncheon meeting of the Northwest Ohio Regional Economic Development Association, disclosed an effort by Chinese investors to develop a pharmaceutical business in the Toledo area.
The study, commissioned by the Asia Society in New York and the Woodrow Wilson Center for International Scholars in Washington, opens with: "The coming decade will bring an unprecedented boom in Chinese capital seeking investment opportunities abroad, and will require Americans to respond to those flows."
The study goes on to state that "surging Chinese investment has triggered anxieties as well as excitement among Americans." It warns that the United States could miss out on its share of Chinese investment worldwide because of politics; a growing perception that Chinese investments are not welcome in this country, and because of the rivalry between the two nations.
Some of those anxieties, as well as excitement, were visible after Mayor Bell returned from his 11-day trade mission to China last year and announced Ms. Yuan and Mr. Wu had formed the company Dashing Pacific Group to buy The Docks.
The two investors subsequently offered $3.8 million for the city-owned Marina District, but later withdrew the offer; the deal appears to be on hold.
The firm withdrew the purchase offer for a 69-acre parcel in the east- side waterfront property after some on City Council tried to require the use of union contractors in future site development.
But Tom Crothers, the city's deputy mayor of external relations, made it clear Thursday that the city of Toledo is "open for business" with respect to direct foreign investment.
"Sure, there are folks out in the community who are not as open to change perhaps, welcoming folks from other nations, but by and large, we are," Mr. Crothers said. "If there are areas of our country where Chinese or any other investment may not be welcome, it is welcome here in city of Toledo and northwest Ohio … so we will gladly accept investments from other countries."
Money from China flowing into the United States could snowball, the study predicts.
The People's Republic of China's overseas direct investments were $59 billion in 2010 but could increase to $100 billion to $200 billion a year, the Asia Society study said.
"We recognize this as a tremendous opportunity because our dollar is weak at the moment in comparison to other currencies, so it is an opportunity for investors from other countries," Mr. Crothers said. "The USA is fertile for foreign direct investment and we are seeing that as we will welcome numbers of groups from a number of countries."
Councilman Rob Ludeman, a Republican who opposed the union labor requirement suggestion for Dashing Pacific, said the nationality of investors or where the money comes from shouldn't affect a deal.
"I have had a few people not necessarily prejudicially, say to use caution because of the political makeup of China," Mr. Ludeman said. "For the most part, folks I talk to who are business people say if the city of Toledo can market their properties and get a fair price, it should."
But anti-China rhetoric remains in Washington and in Toledo.
U.S. Rep. Marcy Kaptur (D., Toledo) was among those urging Mr. Bell to use caution when dealing with Chinese investors.
She and Toledo Councilman Lindsay Webb said publicly that they suspected the funding used to buy The Docks could have some degree of Chinese state-sponsored investment.
Ms. Yuan, in a March 25th interview with The Blade while she was in the city, said the money used to purchase The Docks came from totally private sources.
That concern has been proved in other places since many Chinese companies are owned partly or entirely by the Chinese government.
Other worries include China buying American manufacturing companies, shutting down the U.S. factories, and moving production to China, where it is generally cheaper to produce goods.
After Dashing Pacific Group withdrew its offer, the Toledo Regional Chamber of Commerce issued a statement urging council to approve the sale agreement.
Chamber President Mark V'Soske said the foreign direct investment discussed in the Asia Society Study is extremely valuable for Toledo.
"We can be really picky and choosy for a lot of the wrong reasons and continue to suffer high unemployment and more economic decline," Mr. V'Soske said. "Or we can be smart and more forward with some opportunities to give people some jobs … and I don't believe the Chinese thing is the end all to be all -- the final solution. It is not. It's a part."
Contact Ignazio Messina at: firstname.lastname@example.org or 419-724-6171.