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Sunday, 28 April 2013 22:00

Trade trips deepen ties between West Michigan, Netherlands

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It comes as no surprise that West Michigan shares a substantial cultural heritage with the Netherlands, but the two regions also have significant business and agricultural ties.

Growing those business connections was the focus of a Dutch investment mission involving a delegation of Michigan political and business leaders led by Lt. Gov. Brian Calley in April.

Jeb Burns, president of the West Michigan Global Initiative, one of the groups behind the diplomatic and business trip, said the trade mission was another chapter in a relationship that goes back years.

The goal, he said, “was to (enhance) the Dutch/United States relationship.”

“We hope to bring investors and business people (from the Netherlands) to West Michigan to show this is a place to invest dollars,” said Burns, the chief investment officer for the Michigan Employee Retirement Service.

The April 13-19 visit included several companies and a contingent of political figures including Speaker of the House Jase Bolger (R-Marshall), state Sen. Arlan Meekhof (R-West Olive), and Jamie Clover Adams, director of the Michigan Department of Agriculture and Rural Development.

According to data compiled by the Brookings Institution and provided to MiBiz by West Michigan economic development group The Right Place Inc., real exports from the Grand Rapids metropolitan area to the Netherlands accounted for $118.9 million in 2010. That puts the European country number nine on the list of where West Michigan sends its products.

“It’s a quiet but important relationship,” Burns said.

Martin Olde Monnikhof, the agricultural counselor for the Netherlands to the United States, believes that number should be much higher. He told MiBiz he’d like to see the overall reciprocal trade relationship between West Michigan and his native country become even stronger.

“I was a little surprised that there was not a lot more trade between Michigan and the Netherlands because we are very close in a lot of fields,” he said. “I think there’s space to increase trade and investments.”

The Michigan trade mission to the Netherlands reciprocated Olde Monnikhof’s visit to West Michigan last fall, when he toured several farms and food processors and spent time at Michigan State University in East Lansing, as previously reported in MiBiz.

For examples of where the trade relationship might deepen, Olde Monnikhof said he was “amazed” that soybean producer Zeeland Farm Services does not have an export base for its specialty soybean products in Europe.

While the company exports soybeans to Japan for the production of soy sauce, executives at Zeeland Farm Services said the challenge with exporting to Europe is centered on logistics.

“We don’t have a good competitive ship loading terminal at a Michigan port,” said Cliff Meeuwsen, president of ZFS.

Despite the challenges, executives at the company said that they continue to explore business opportunities to export more to Europe and elsewhere.

“We’ve had a difficult time providing competitively priced non-GMO soybeans or soybean meal to the EU because most are brought in from Eastern Europe or from South America via bulk vessel,” Darwin Radar, the international sales and marketing manager for Zeeland Farm Services, said in an email. “Containerized freight from north central U.S. is more competitive to Asia than to Europe, which also adds to the barriers of establishing long-term business in the EU.”

While the cultural similarities between West Michigan and the Netherlands are obvious — according to Olde Monnikhof, there are approximately 480,000 people of Dutch heritage living in the West Michigan region — the two areas also have a great deal of agricultural industry in common.

Although both regions are known for dairy production, for example, the Dutch farmers typically work on a much smaller scale than their counterparts in West Michigan. Olde Monnikhof said that many Dutch farms, while producing similar agricultural products, are situated on much smaller pieces of land, but have learned to maximize their profitability even at that scale. He explained that a Dutch dairy farm might only have 100 cows, which would be small by comparison to a West Michigan industrial dairy farm.

The two regions might work together to understand each other’s agricultural best practices, he said.

As the relationship deepens between Dutch and West Michigan business and political leaders, some believe that these trade trips could have positive long-term economic results. In some cases, those mutual benefits may already be coming to fruition.

A visit to West Michigan last September by a Dutch delegation that included former Prime Minister Jan Peter Balkenende led to “significant investments” in local companies, said a source with knowledge of the deals, who noted that the relationships were still in the early stages of development.

“(The relationship between the two areas) just makes good international business sense,” said Tim Mroz, vice president of marketing and communications at The Right Place Inc., another group that helped facilitate the trips. “The more globally diverse West Michigan can be, the stronger it will be in the long term.”

Long term potential aside, Burns of the West Michigan Global Initiative is confident the two regions have embarked on a meaningful relationship-building dialogue.

“The main goal is that (the West Michigan Global Initiative is) a facilitator of networks, building for future business growth,” Burns said. “Twelve or 24 months from now, we are hoping for contracts.”

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