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Although still a less internationally known city than West Coast powerhouses Los Angeles and San Francisco to the South and Seattle and Vancouver, Canada to the North, Portland, Oregon continued to build ties to Asia in 2002. First among the new links was Air China and Portland’s announcement that on Oct. 27 that Air China Cargo began nonstop service at Portland International Airport (PDX), connecting Oregon and Southwest Washington businesses directly to the People’s Republic of China. Air China Cargo began the new all-cargo air service using a Boeing 747 freighter, traveling every Sunday and Thursday on a route from Portland to Beijing, the airline’s hub.Air China Cargo’s Dr. Wing Kun Tam made the announcement during a news conference at the Classical Chinese Garden in Portland, the largest Suzhou-style Chinese garden outside of China and a cultural link between the two countries. Joining Dr. Tam were Oregon Governor John Kitzhaber, Portland Mayor Vera Katz, Port of Portland Commission President Jay Waldron, Port of Portland Executive Director Bill Wyatt, Nike Manufacturing Logistics Manager Dave Hill and regional business leaders. Dr. Tam presented Governor Kitzhaber and Mayor Katz with an Air China Cargo model aircraft to commemorate the new partnership.
Non-stop air cargo service from PDX to China will provide West Coast local shippers faster transit times, competitive pricing, reduced damage to cargo because of less handling, which also saves money. Nike, Tektronix, Intel, ESI, Epson and InFocus are some of the many local companies that are developing or already have a manufacturing or business presence in China and that plan to use the new service.
According to Dr. Tam, "Portland presented us with a unique opportunity to maximize our West Coast service,”. “The plane will load some cargo in Los Angeles, and then 'top off' at PDX. We are looking forward to offering the shippers and forwarders of the Pacific Northwest region enhanced cargo access to and from China. We’re confident this operation will be successful with the support of local businesses. Then we intend to expand to three flights per week in the future.”
"In a world where business success is measured in seconds, this speedy new cargo service will help regional businesses be competitive in the global marketplace," said outgoing Oregon Governor Kitzhaber. "China is Oregon's fastest growing top 10 air export market in Asia. A growing Chinese economy and the direct air link will promote more trade and friendship, which will benefit the United States, China and Oregon."
The non-stop air cargo service is a priority for Oregon and Southwest Washington that were economically booming but now stumbling as the area’s base of tech companies fell on hard time. The reason for the priority is because China enjoys robust economic growth, and that manufacturing that was previously located elsewhere in Asia is relocating there to take advantage of low priced labor and a growing consumer market. Moreover, China’s entrance into the World Trade Organization this past year is already creating additional opportunities for Pacific Northwest businesses.
In 2001, China was Oregon’s third-largest air export market with almost 2,000 metric tons. From 1996-2001, Oregon’s air cargo exports to China increased 200 percent.
“Now, with Air China Cargo, our ability to directly move products to Southeast Asian markets will create new economic opportunities for the Pacific Northwest,” said Mayor Katz. “I applaud the Port's International Air Service Committee for its dedication and for this great success in providing the citizens of Portland with direct access to new markets.”
Air China Cargo is the cargo arm of Air China, which also operates passenger service within China and around the world. Air China Cargo service is a significant coup for Oregon and Southwest Washington. Portland’s PDX International airport has been shopping around for international players to take the place of Delta Airlines which axed their service to Japan the year before. Although the service is Cargo only, additional news recently that Lufthansa, the major German airline would add a Frankfurt - Portland service and now this new Cargo service keeps Portland’s international.
In addition to the major successes the Port of Portland has achieved in bringing Lufthansa and Air China Cargo to Portland, on July 15, area importers and exporters were able to now use a new regularly-scheduled, direct ocean container service with Yantian, a growing port in mainland China near Hong Kong. The new southern China service takes effect with the introduction of the third of five newer, larger containerships that Tokyo-based “K” Line and its vessel-sharing partners are transitioning into their Portland-calling NOWCO A vessel service
For the United States as a whole, trade to and from Yantian has grown from $5.5 billion in 1998 to $15 billion in 2001, most of which is U.S. bound import cargo. Yantian now generates more import containers for the U.S. than any other foreign port, with the exception of Hong Kong and Tokyo. This is an important consideration for Portland, which has four times more loaded export containers going out than loaded import containers coming in. This is because receiving and unloading more import containers in Portland frees up the containers to be used by regional exporters. It also creates a better inbound-outbound cargo balance for ocean carriers, marginally lowers costs and thus helps the port serve this market.
“While U.S. exports to Yantian last year amounted to only $150 million of the $15 billion trade total, that was up from $48 million in 1998,” a major jump said Jeff Krug, the Port of Portland’s marine liner division marketing manager. “More than tripling export trade volume in three years suggests the growing level of interest in southern China for U.S.-produced goods.”
The 3,500-teu (twenty-foot equivalent unit) container capacity YM Tacoma- which has 30 percent more capacity than the ship it is replacing-follows the introduction of two similarly-sized ships since January. Over the coming weeks, “K” Line and its partners are slated to bring two more comparably-sized vessels into their NOWCO A rotation to complete the transition to larger ships.
“Transitioning to larger vessels having more container capacity, and adding new service with a fast-growing port in southern China shows the commitment “K” Line and its partners have for serving this market well,” said Bill Wyatt, the Port’s executive director. “At a time when our economy is still sputtering, this action may help stimulate more international trade, and jobs that trade creates, by providing regional shippers improved market access.”
With the above successes in 2002, the Port of Portland, the City and the State have much to be proud of. Despite these successes, Portland, however, remains a little known trade destination in most of Asia. Further, many Oregon companies remain less aware of international opportunities than their Seattle, San Francisco and Los Angeles competitors. If Portland is thus to build on its success in 2003, the Port, City, State and Federal government all need to continue to work with private business to continue to build international links.
About the Author: Christopher W. Runckel, a former senior US diplomat who served in many counties in Asia, is a graduate of the University of Oregon and Lewis and Clark Law School. He served as Deputy General Counsel of President Gerald Ford’s Presidential Clemency Board.Until April of 1999, Mr. Runckel was Minister-Counselor of the US Embassy in Beijing, China. Mr. Runckel lived and worked in Thailand for over six years. He was the first permanently assigned U.S. diplomat to return to Vietnam after the Vietnam War. In 1997, he was awarded the U.S. Department of States highest award for service, the Distinguished Honor Award, for his contribution to improving U.S.-Vietnam relations. Mr. Runckel is one of only two non-Ambassadors to receive this award in the 200-year history of the U.S. diplomatic service.
Copyright, 2003 © Runckel & Associates
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