Otter's trip to Cuba failed to bring home the bacon
The contrast with successful trade missions to China shows the
difficulty of doing business with the communist island nation
Joe Jaszewski / Idaho Statesman
Frozen pig carc***** are pushed from the carcass cooler into the ****k
fabrication room at Falls Brand Independent Meats in Twin Falls. The
carc***** are cut into primal cuts and either boned or packaged as a
whole muscle cut. The company participated in Gov. Butch Otter's trade
missions to both Cuba and China, but only the China trip has resulted in
sales for the company.
Otter heads to Mexico today
Gov. Butch Otter leaves Saturday for a four-day trade delegation to
Mexico. The governor and first lady Lori Otter will be joined by Idaho
business leaders.
It is Otter's third trade mission and first to Mexico as governor. He
has also led trade missions to China and Cuba.
Otter led three missions to Mexico as lieutenant governor in the 1990s.
The trip is expected to cost taxpayers $18,759, with business leaders
paying their own way.
BY HEATH DRUZIN - hdruzin@[EMAIL PROTECTED]
Date: 04/19/08
TWIN FALLS - In the year since Gov. Butch Otter went on a trade mission
to Cuba, the only new ex****ts the state has sent to the island nation
are a handful of signed baseballs, Boise Hawks jerseys, and cowboy books
the governor brought as gifts for his hosts.
Hopes that the trip would provide a new market for Idaho produce and
meat have gone unrealized.
The taxpayer bill for Otter's fourth visit to Cuba as an elected
official was nearly $14,000.
As Otter embarks Saturday on a new trade mission to Mexico, money Idaho
has received from new Cuba trade has totaled $0, raising questions about
the efficacy and motives behind the trip.
"The results have been far less than we had hoped for, for various
reasons," said Department of Agriculture spokeswoman Laura Johnson.
That's in stark contrast to the results of Otter's other gubernatorial
trade mission, a trip to China last fall that has already yielded more
than $2 million in sales, with more in the works.
The experience of a Twin Falls meat producer illustrates the contrast.
Falls Brand Independent Meats does a brisk business with China, a nation
of more than 1 billion people with a thriving business sector.
All the company has to show for its efforts to trade with Cuba, an
island nation of just 11 million where the government has a vise grip on
trade, are frustration and 50 tons of unsold meat.
'WE'VE MOVED ON'
Otter traveled to Cuba with a delegation of Idaho business leaders last
April, saying he was trying to open new markets.
"He's going down there to sell groceries. It isn't to be adventurous,"
Otter spokesman Jon Hanian said at the time. "It's an op****tunity to
make some sales."
Government officials are now backing off such assertions, with one
Commerce Department spokeswoman calling the Cuba trip a
"relation****p-building mission."
"These kinds of business relation****ps take time in the best of
cir***stances," Hanian said.
A much-touted contract that came out of the Cuba mission was for 100,000
pounds of ****k legs from Falls Brand Independent Meats.
Between the red tape put up by Cuba's government and the rising fuel
costs for getting ****k to the Gulf of Mexico, Falls Brand CEO Pat
Florence said he's not counting on cracking the Cuban market any time
soon.
The Cuban government never followed through on its plan to buy
Florence's meat, which would have netted the company $100,000.
"We've moved on," Florence said.
A TALE OF TWO MISSIONS
Otter's trip to China yielded much more immediate results.
That trade mission was directly responsible for more than $2 million in
new contracts, according to the Department of Commerce, and the fruits
of the trip were on display Wednesday as ****k legs rolled down conveyor
belts at Falls Brand's frigid, labyrinthine processing plant.
Andrew Lee, a Hong Kong restaurateur who met a Falls Brand official on
the China mission, was touring the plant for a prospective deal that
would add to the $9 million to $11 million worth of ****k Falls Brand
already ****ps to Asia.
While China, like Cuba, has an authoritarian communist regime, trading
is easier because in China, companies sign deals. In Cuba, the
government is the trading partner, Florence said.
"It's a lot more tricky (in Cuba)," he said. "It's a lot more
politically motivated."
TOUGH SELL
Several local business experts questioned the efficacy of a trade
mission to Cuba, especially in the short term.
Trade missions can open doors for businesses and help facilitate sales,
said Jason Schweizer, director of the Business and Accounting Department
at the College of Idaho. But even an open Cuba, with only 11 million
people, is a curious choice for a state business trip, he said.
"Unfortunately, yes, you get trade missions that are done more for
political reasons than for business reasons," Schweizer said.
A large country, like Brazil, would make more business sense for a trade
mission than a small island nation that will never be a big agricultural
market, Schweizer said.
"It's hard for me to see what economic value it has," he said.
When Cuba opens up, there could be money to be made on the island, but
right now it is an extremely limited market, and any trade mission there
should have modest expectations, said Ron Galloway, dean of the
Northwest Nazarene University School of Business.
"If I'm participating in a Cuban mission, am I really going to get a
return now or am I just trying to see how they do business, or say, 'I
went to Cuba'? " he said.
Taking the long view, Boise State University international business
lecturer Meredith Taylor said the relation****ps built now in Cuba could
pay dividends down the road.
"Trade is going to globalize, the country is going to free up," she
said. "The return is going to be substantial."
ONE ORDER OF FRIES
Otter has long been a vocal critic of the U.S. trade embargo and made
three visits to the country when he was a congressman. All were
privately funded.
"He believes the best way to effect change there is to engage in
commerce," Hanian said.
In the five years since Otter's first visit to Cuba, Idaho has sold one
****pment of frozen french fries, for about $22,000, according to the
Department of Agriculture. That is despite an agreement to buy $10
million worth of Idaho agricultural products, signed by Cuba during a
2004 visit by Otter and Sen. Larry Craig, R-Idaho.
Idaho is trying to get visas for members of the Cuban government who
want to inspect some agricultural operations this summer to explore
trade options, Hanian said. The same Cuban officials tried to visit last
summer but could not get visas in time.
Despite the difficulties, Otter still sees Cuba as an im****tant future
market for Idaho.
"He is optimistic it's going to pay off down the road," Hanian said.
Heath Druzin: 373-6617
http://www.idahostatesman.com/business/story/356426.html
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