Cutler: To survive, Maine must market itself to China, the world

HERMON, Maine — Maine businessman and former gubernatorial candidate Eliot Cutler stressed the importance of exporting Maine’s products to China and other countries at the Bangor Region Chamber of Commerce’s annual breakfast on Tuesday morning.

For thousands of years, China accounted for 22 percent to 34 percent of the world’s economic output. That ended about 150 years ago, when the nation sealed itself away from the rest of the world.

With that decision, China missed out on the Industrial Revolution and saw its share of global GDP eventually drop to 4.5 percent in 1950. But in the last decade and a half, China has come roaring back. The growth of the Chinese economy and its impact on the world is huge and growing, according Eliot Cutler, who has lived and worked in China and has created several companies to explore economic ties between Maine and China.

Speaking before a capacity crowd of about 300 people at Morgan Hill Event Center in Hermon, Cutler noted projections that the Chinese economy in 2040 will be three times larger than that of the United States. China’s five-year plan calls for the standard minimum wage to increase by 13 percent, and for disposable income among urban residents to grow by 7 percent annually.

Cutler said that China’s growth demands Maine’s attention as an export market, as a source of business investment and as a supplier of tourists who want to visit the state for its natural beauty.

“Maine’s economic future requires a strategic agenda that responds to this new world order, that recognizes the importance to Maine of these new markets in China, and that builds a relationship with China that will create opportunity and economic growth here in Maine,” Cutler said.

Cutler said it’s important to invite Chinese officials to Maine so they can see what makes the state unique. In 2010, he brought two prominent Chinese businessmen to Maine, where they lobstered on Penobscot Bay, visited the blueberry barrens and ate at Crocker House at Hancock Point.

The two men were amazed at the clarity of the water in Frenchman Bay, said Cutler, and took off their shoes, rolled up their pants and waded in, enjoying the scenic setting and natural beauty.

That, he said, demonstrated how to best sell Maine’s brand — by bringing people here and showing them the beauty, the people, the environment.

“One of the advantages of bringing the Chinese to Maine is the opportunity it provides to show in ways that words and pictures can’t just what makes Maine unique,” he said.

Maine, said Cutler, needs to develop that worldwide brand and sell it globally, aiming in particular at China.

“We need to develop and spin out across the world a Maine brand that embraces our state, the experience of visiting and living here and the extraordinary qualities of our work force and the products they produce,” Cutler suggested.

But to get there, said Cutler, the state needs to plan out 20 to 30 years. Cutler said there’s only one school in the University of Maine system that teaches Chinese — the University of Maine at Farmington — and suggested there’s a huge need to teach both Chinese language and culture in Maine, so ties can be forged between that growing economy and the state.

Ziaorong Horton, a real estate agent with Realty of Maine, said Cutler’s thoughts on growing Maine’s economy through reaching out to China made sense. Horton grew up in the coal mining town of Taiyuan and lived in the Chinese cultural center of Hangzhou before moving to New York in 1999, then to Maine in 2003.

In 2003, she said, she had hoped to market Maine real estate to the Chinese market. But at the time, the Chinese couldn’t afford Maine property. Today, she said, the currency has appreciated. She returned to China in September to find potential clients and found that “everybody’s ready — just in five years.”

A former classmate in Hanzhou joked that he could sell a bathroom in that city for what a home costs in Maine, she said.

Just the population base of 1.3 billion people represents an attractive market for Maine, she suggested. And with growing disposable income (the amount of Chinese millionaires was estimated at 1.11 million, according to a 2011 Bloomberg story), Maine could easily become a tourism destination for that market, she said.

“Maine has the wonderful nature that crowded China doesn’t have anymore,” said Horton. “That’s a lifestyle China is looking for.”

Cutler said he and three partners, Tony Kieffer, Suzanne Fox and Justin Schair, have started MaineAsia, a firm that seeks to attract Chinese investment to Maine and grow exports from the state to China. MaineAsia is exploring the market for Maine’s wild blueberries and is working with Sabre Yachts on exporting the company’s vessels to China.

The firm also is looking at advanced solar technology being made in China that may benefit Maine. Kieffer, a Maine native, worked in China for U.S. business analytics firm FICO at the same time that Cutler was in the country. Fox is president of Fox Intercultural Consulting Services, with offices in Beijing and Portland. And Schair worked on Cutler’s gubernatorial campaign.

Another Cutler business, Maine Seafood Ventures, has been working with the China National Cereals, Oils and Foodstuffs Corp., commonly called COFCO, the largest food company in China. Seafood Ventures has become the preferred vendor for frozen lobster to COFCO, and last year exported tens of thousands of pounds of lobster to China, according to Cutler.

“All in all there’s a remarkably close fit in what China needs and what Maine can provide,” Cutler said.

Dan Tremble, the incoming chairman of the Bangor Chamber, said he thought the idea of bringing Chinese here, rather than sending delegations there, made sense.

“If we can get people to come here, it’s a lot easier to sell what we have,” he said.