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Governor undeterred by trade war as he prepares to travel to China

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Governor undeterred by trade war as he prepares to travel to China

Photo by Bryan Wells

Gov. Eric Holcomb is headed to China Sunday for a two-week-long Asian trade mission, convinced he can successfully boost business relationships despite the Trump administration’s ongoing trade war with that nation.

“It’s the perfect time to be making the trip,” Holcomb said Thursday.

This trip, which also includes stops in India, is the eighth trade mission Holcomb has led on behalf of Indiana since he was elected in 2016. The purpose of these trips, which are paid for by private funds to the Indiana Economic Development Corporation, is to strengthen the business and government relations between Indiana and other nations.

Holcomb, whose first mission came in 2017 to Hungary and France, just returned on Sept. 11 from South Korea and Japan. However, this upcoming trip will be the first that Holcomb has taken into a country where President Donald Trump has been embroiled in a trade war.

This war, in which the ammunition is products and tariffs rather than bullets, has lasted for quite some time as both Trump and Chinese President Xi Jinping have been playing a game of king of the hill with each other. Tariffs have exceeded 30%, which The New York Times reports is the highest they have been since the 1960s. Among the casualties of the conflict: farmers in Indiana and elsewhere who have seen their crop sales to China evaporate and their income drop, with many looking for or taking federal bailouts to make ends meet.

Bob White, director of national government relations for the Indiana Farm Bureau, has seen the struggle of Indiana farmers and is hoping Holcomb can work with Chinese state-owned companies to boost sales of their crops.

“In the past 18 months, what has happened when China and the United State get back together at the trade table, somebody makes a commitment and yet, what we have seen in the past is that China has reneged on the commitment.”

This is hurting Hoosier farmers because it is dropping soy bean prices down by $2 per bushel and even pork prices down by a significant amount, he said.

Holcomb said he is confident the trip will be a success for both Indiana and its “sister” state Hangzhou, which is roughly 821 miles away from the Chinese capital of Beijing and 109 miles from the nation’s second most populous city, Shanghai.

“We will make progress, even with the backdrop of the negotiations occurring right now,” he said.

Holcomb said he wants to develop more business-to-business relationships between the two areas, with the hope to bring commerce to Indiana and to send back agricultural products to the countries he visits. The governors also said he is looking to expand government relations, not just with Hangzhou but also with India when he travels there after his stop in China. Among his stops will be meetings with two Indiana-headquartered companies that have operations in China: pharmaceutical giant Eli Lilly and Company and medical device company Zimmer Biomet.

Not everybody shares the governor’s optimism about the trip’s likelihood of success.

“I think it’s impossible,” Rep. Ed DeLaney, an Indianapolis Democrat, said. “The opportunity to create new business or new connections is at, in my view, an all-time low. So if he’s going to China, I don’t find that particularly useful.”

Holcomb, DeLaney said, “ought to come back here and spend his time telling his friends in Washington that trade wars aren’t good and that they hurt two things in particular. They hurt industry and they hurt ag.”

But Kevin Brinegar, president and CEO of the Indiana Chamber of Commerce, said it was “absolutely” a positive for the governor to make this trip, noting that Indiana is a “significant exporter” to China with more than a billion dollars’ worth of manufactured and agricultural products.

Despite the “dueling tariffs” between the U.S. and China, he said, “it’s good that the governor is going there to look at opening up additional potential markets and also additional investments into Indiana companies from those two countries.”

Brinegar noted Indiana is one of the leading states in the nation in recent years to acquire direct foreign investments.

“A big part of how you do that is go visit these people on their turf,” he said.

That leads to more investments, Brinegar said, and those lead to jobs.

The governor and his party, including Indiana Secretary of Commerce Jim Schellinger, will leave the state on Sunday and return on Oct. 5. It won’t be all business. Holcomb plans to conclude the trip by joining the Indiana Pacers in Mumbai for the NBA’s inaugural games in India on Oct. 4 and 5.

Brandon Barger is a reporter for TheStatehouseFile.com, a news website powered by Franklin College journalists.

TheStatehouseFile.com is a news website powered by Franklin College journalism students.

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