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Show China Could Present Major Market Sfibttiw fake jjjalt For Many Exporters From Utah Sunday, December By Robert H. Woody Tribune Business Editor No longer 'Communist China." Nor 'Red China " Those emotion-ladeterms have given way to the formal identity The People's 28, 197.5 n Section II Pate!! Republic of or the PRC" for short. With the Shanghai communique of Feb. 28, 1972. concluding former President Richard M. Nixon's visit, the China Economic Outlook Confusing to Most Observers By Thomas E. Mullaiiey York Times W riter continued m the months, should generate enough business contidence to step up inventory building and eventually aid capital spending. Some Sales l.itts .New NEW YORK Only a lew more s to go belore the litt-o- tt into 1976 j(id still counting. There's not much time lelt to change the quality ot an old ar that has been so dramatic in many y lespects. but there is still opportunity dr government leaders, businessmen, labor leaders and the di are the turttmr gains in personal income (up almost percent, or 811 billion in Novembers the nation's urging export volume that points lowa.d a tiade surplus ot some 812 billion this year alter a $2.3 billion ueiicit m 1971, and the steadily improving status of the dollar in relation to most other loreign currencies. Also encouraging 1 jnerican consumer to dratt some worthwhile resolutions to make things a whole lot better in the new better ar. the waning days ot 1975, the political and economic news has been rjther puzzling and quite disturbing in sme aspects. While hardly suggestive t any major change in the generally lavorah-business prospects tor 1976, tle tenor ol many recent developments has been enough to raise Iresh doubts about a more harmonious year ahead. So, instead ol approaching the new year with high hopes and confidence in the domestic economy and the expected upturn in other Western lands, many Americans will greet 1976 wlth a dash ol apprehension. ) Reasons for Confusion t W ashmgton has been responsible lor much ol the last confusion and uncers on so many tainty. with its linancial aid to crucial issues New York City , the tax ajid energy bills, the unconeluded late n legislation to help the distressed eastern railroads, the construetion-IMcketmbill, attitude toward the obiectnes ol the Third Wrld and the debate over the United Slates position oil the revolution in Angola. In the economic area, there has also leii a eery mixed trend in the latest data, with some continuing pockets ol sjrength oltset by lingering potholes of weakness. The most cheerlul news has been the p pnsingly strong pace ol retail sales across the country th;s month. Een New York City's stores, which had been lagging behind the national trend all year, chalked up big sales gains during the Christmas season. Elsewhere, more impressive increases were achieved, indicating record retail sales this year, m ui alter allowing tor inilatiun J In The good economic news, however, is counterbalanced by enough adverse developments to warrant a good meas-ui- e : ol caution and concern. Industrial production has begun to taper off alter a strong rise iollowmg the end ol the recession last spring; unemployment remains abound the 8 percent level and shows no tendency to move much inllation remains stubbornly above 8 percent; state and local spending and services are being reduced sharply in many areas iollov.mg the New York bscal trauma: the slock market is not showing the spirited gains it might be expected to generate as a lejdine economic indicator, and the decline in interest rates seems to have stopped at a lairly elevated level, and may have begun a new rise still-risin- g low-er- thp-iiop- near-bankru- particularly Confusing g The mllalion picture is particularly contusing. In November, the Consumer Price Index continued to rise, at the unsatisfactorily high annual rate ot 8.5 percent, despite some recent encouragin the food and ing improvement commodity sectors. The villain in the recent upturn was in services, which moved up strongly on increases in insurance lees mortgage rates, and the costs ol utilities. Although state and local taxes are headed higher, as well as fire and casualty insurance rates, there is hope lor some moderation in the inllation in other serpicture early next r vices. in luels with enactment ot new energy legislation and m the tood and commodity areas. But tne latter is not at all certain m view ol some recent higher-pric- e announcements tor chemicals. autoa and other products, as well as the Government's report that the winter wheat crop is expected to decline about 9 percent liom last year's record yield because ol bad weather conditions. yc-a- While seasonal adjustment tempers some ol the excitement the huge dollar sales ol this month, the important thing noted by some analysts is the oer laid that December and the third quarter continued to show retail sales growth in a real sense. While sales ot other durables have continued to lag badly, the stellar and auto pbrlormance of retail sales, plus the continuing rise in itjiusing actn ity indicate an underlying strength ot consumer contidence that, it While some Uassandras (loiiMiiner Price Index l)i, iSlijilitU in Japan last-minu- TOKYO (AIM Japan's consumer 0 7 percent m declined index fjrice November, from a month ago hut was i)p 8.1 percent from a year earlier, the prime minister's ofliee reported What is needed is some patience in Washington, more political stability and economic recovery abroad, and a determined el tort to get to heart ot the unemployment, inllation and other problems that beset the nation The decline lrom October was attn-IJuteto cheaper lood prices m the month, the report said. d h i are already bemoaning the economys chances loV sustaining its advance lrom its worst recession in three decades, it is really premature to concede Us demise. There still seems lo be enough momentum to carry the advance thiough many additional months, spasmodically il not strongly. And the approval ol a bill to extend the 1975 tax cuts into next year should provide a favorable background. . j post-Christu- (Copy right i with up- tential market for products. major commodities and By 1971. the U S and China were much of it in trading nearly $1 billion agricultural products from the U.S. Total to Decrease Because the Chinese are not buying much agricultural produce this year, the total is expected to he only about trade the trade balance Currently V , ,v e 8450 million in is in (avor of the U S.. says William Clarke, director of PRC affairs in the Stale Bureau of East-WeDepartment's Trade. The U.S. will buy about $'.50 million in Chinese exports this year. China will buy $300 million in US goods Next year, he says, imports exports will probably balance out The trailing is a trickle now there's plenty of potential for growth. Utah Potential? How does Utah stand as a potential exporter to China Utah exported nearly $130 million in goods in 1974. according to the Department of Commerce. As far as potential export to China is concerned. Utah does produce commodities likely to be sought by the Chinese. These include what. nitrogenous leHtlizers, computers and calculating machines, telecommunication equipment. proi ess control instrumentation ; pumps, centrifuges and filtering equipment. mining and construction machinery, agricultural machinery, and airport ground support equipment Few Visit China Few Utahns have visited the PRC You can count them on one hand. Arthur C. Deck, executive editor ol The Sait Lake Tribune, was with a delegation of the American Society of Newspaper Editors, who toured China and talked with its leaders in the fall of 1972. Dr. Kenneth B. Castleton. former dean of the University of Utahs College of Medicine, and Dr. Clifford Snyder, Salt Lake City, were with an American medical group who visited in May of 1973. Utah Gov. Calvin L. Rampton and his were among a group of local government leaders invited by the Chinese to visit in May. 1971. No Casual Visits The visits bv a handful of Utahns underscores one central fact. No American casually visits China. A visit is by invitation and for specilie purpose A major hangup of the Chinese, says Gov. Rampton. is the United States' continued recognition of the Nationalist China government on Taiwan. You can talk about trade with your PRC host, and he will always turn to the Taiw an issue. However, it is a hangup, the governor says, that the PRC would probably get around if they perceived a Irude deal that suits their purpose. Deal Directly In selling to much of the world. American manufacturers deal directly with buying companies or through agents in those countries. It has sometimes been a business involving distasteful "commissions to agents to make sure a product somehow represents itself advantageously over tlia of the French or German competitor. wife Worker tends cabbage in field near the Peoples Republic of China. Pckng Utah-produce- Dealing with the Chinese is another matter Trading is a -- tale monopoly and is done through eight corporalions. each covering a category ol street e.g . chemicals, hht indusproducts trial. metals and minerals, etc The corporations make tin decisions about w hat to buy, from whom to buy not an agent, not a chief engineer, noi a corporate executive committee Not Unlike Soviets It is not unlike dealing with the Soviet Union or certain eastern European Mr Clarke, just three countries weeks rt, ...led from a visit to Peking One thing: You do not have to be big to deal vv ith PRC foreign trade corporations. XYZ Company of Utah may well have a better chance than General Motors il it lias the product the Chinese want, says Mr. Clarke And the Chinese pay in hard cash dollars or Swiss francs How can a Utah businessman look n to marketing in China? He can write the State Department for a handbook on how to seek markets in China. Can Write Directly He can also write directly to the specific trading corporation that deals with his product If the Chinese are interested, they will extend an invitation for him to visit China "to discuss the matter further. says Mr. Clarke. Utah businessmen are now in and out of Europe on a fairly casual basis. Will they he commuting to China with and ease in a similar frequency decade? Not likely, says Gov. Rampton. The v isa accreditation requirements, etc. lor getting into China will probably be more like those tor getting into Russia or certain eastern European countries. Potential Market While China is not a priority as Utah looks to expanding its export base, it is nevertheless a substantial potential maiket. And if the Utah business community wants to put together a trade mission, the state would act as a catalyst." he says Utah business alreadv is looking at the PRC. Christensen. Inc., Salt Lake City, the world's largest manufacturer of diamond hits lor drilling, has had its Houston, Tex., and Australian plant managers in China to visit the trade shows and exhibitions, says Frank Christensen, chairman Diamond drill tuts are used extensively in petroleum drilling. The Chinese have a major exploration program under way. Among First Christensen was among the fir-- t to sell diamond drill hits to the Soviet Union "I don't see that it may be long chemical fertilizer could find market in China. Some Utah firms already are studying export. in d before we re tradini in China as we were in Russia " James Clark, president of the Eimco Machinery Division of Envirotech. Suit Lake C ity, says' We recognize they do need mining machinery to develop their resources. W'e also recognize some of the difficulties in selling to the Chinese." One of Enviroteeh's senior viee presidents has been to China on a trade mission. Inc The Dallas-base- d whose Montek Division is located in Salt Lake City, already has done business with the Chinese. Constructed Antenna It cur. i acted the dish antenna in Peking wnich was used for the satellite-relayebroadcast of Nixon's 1972 visit George J Thiergartner, vice president and general manager of Montek said the Utah plant has Division, products that eoultl go to China subject to the "political lead of the State Department and the lommerce Department Certain products and commodities are those with a military application on a restricted list, he explained Montek produces air navigation systems for military aircraft of the U S and friendly nations. Military, Civilian Marriage It also produces navigation aids for civilian flight. In a sense, there is, for the sake of optimum use of air space in the U.S.. a marriage of the military and civilian systems. It is known, however, that Russia and China need air space and traffic conttol systems. "We are very much interested in the market. says Mr. Thiergartner. com"W'e know our international petitors are already theie " Peter Behrens, president of Great Salt Lake Minerals & Chemicals Co , which produces fertilizer constituents from lake brines, says Utah is as close to the China agricultural market as any other area Canada is marketing muriate ol potash, or potassium chloride, in China now Can Be Harmful the potassium in potassium chloride is of nutrient benefit, he says In certain soils, the chloride can be harmful The Utah company produces potassium sulfate. Both the potassium and siiMate arc fertilizer ingredients. In the long-run- , he says China, will need particularly for potassium sulphate certain crops like tobacco. GSL has made no direct contact with the Chinese But it has been talking to traders. It had been marketing potash in South letnam betore the collapse. said. John L Margetts. chairman ot Dynapnc Inc , Salt Luke City, said he v ill Ik leaving for the Orient Jan. 6 meng his activities will be tnvestiga tarn of market possibilities m China. For many years, the firm sold its "Stokermatic" coal stoves in Japan for residential heating. Only . d 1 Could Be Used China, he said, produces a good quality of coal that could be used in the versatile Stokermatic Mr. Clarke notes that more and more Americans are going to the Canton W'e (the Trade Fair in China. Andconimi ree department) will help put together trade missions to the extent the Chinese accept them." A few weeks ago. the American Chamber of Commerce ol the Far East advocated quick American trade entry into Southeast Asia. What are the possibilities of contacts ' with Vietnam now under dominion ol the north, and conquered Cambodia? 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