Miami, long a gateway to Latin America, is hoping to parlay that access into a cozier business relationship with the Far East. In particular, business leaders here have China in their sights.
That was the predominant buzz at this June’s annual Greater Miami Chamber of Commerce goals conference, where the prospects were laid out for more trade and investment with China, Taiwan and Japan. But while there are hopeful signs that the local economy is rebounding and infrastructure projects are underway to help Miami compete for Asian business and investment, most here agree that there is a long way to go before a new “silk road” is created.
“The opportunity for Miami will mostly be to play the role of an aggregator for Latin American businesses that want to do business in China,” says Ray Ruga, principal at the marketing firm CVOX Group LLC, which focuses on helping Latin American and Miami-based companies promote their businesses in China. “That role isn’t assured yet because Miami’s relationship with China is still new.”
To put this in perspective: Trade between China and Miami-Dade County is estimated to have been $3.9 billion in 2009, according to research by WorldCity comparable to the level of trade the region did with the Dominican Republic, a country whose economy is roughly 100 times smaller but is only 900 miles away from Miami.
But China trade will get a boost once dredging is completed that will allow larger ships, carrying roughly five times the cargo of current vessels, to dock at the Port of Miami. That move and construction of new gates now underway at the Panama Canal will make it more cost-effective for Chinese businesses to use Miami as a distribution hub for goods and materials.
“China has been here for years, kicking the tires,” says Frank R. Nero, president and CEO of the Beacon Council, Miami-Dade’s economic development organization.
But, only recently, there have been concrete moves to invest in the area including the June signing of an agreement to open a logistics center in the city of Opa-locka, which will serve as a “linkage to Chinese manufacturers in Latin America.” Nero added that the center is expected to house 50 companies and create 3,000 jobs, and that an estimated 500 Chinese nationals will relocate to Miami because of the facility.
The influx of Chinese immigrants into the Miami area is of particular interest to those in the real estate industry, which was hard hit during the recession.
“They’re here and they’re buying, but nobody knows how to connect with them,” said a frustrated Teresa King Kinney, CEO of the Realtor Association of Greater Miami and the Beaches, during one of the chamber’s planning sessions.
According to Kinney and others at the session, language barriers and an overall unfamiliarity with the landscape of Chinese business interests are making it difficult for Miami business to leverage the growing interest that China and other Asian countries have in investing and doing business here.
“What Miami lacks is leadership, particularly among elected officials,” says CVOX’s Ruga, adding that local governments need to step up or risk losing the opportunity to other cities competing for Chinese investment. “Latin America feels so comfortable doing business with South Florida that this could be a one-stop shop for Chinese businesses.”
William Plasencia is a longtime business journalist and president of WPA Works, a communications and media consulting company based in Miami. Reach him at www.wpaworks.com.