A few weeks ago, I was fortunate enough to accompany a group of travelers from First Farmers Bank and Trust (FFBT) to the country of China. The trip was described as a collateral visit to observe some swine production facilities being built in China and I thought the trip was a worthy investment to make out of my own pocket. The potential business prospects are the result of years of hard work by Dr. Mike Lemmon and his family from Albion, Ind. His business has developed relationships in China and they have been selling swine breeding stock to the Chinese. Now, Dr. Lemmon is building modern facilities in China to produce pork for consumption for the Chinese marketplace. As a point of information, China has a swine sow herd of 60 million sows. By comparison, the U.S. has 6 million sows in its herd. China needs to feed 1.4 billion people, while the U.S. feeds 330 million people and then exports the surplus to other countries. The Lemmon family's theory is that there is room for profit in China with such a large market for pork. The demand for pork in China is high and they use it as a protein source in a variety of dishes. If you have visited the country, you may be familiar with the variety of delicious pork dishes. A common question on people's mind when they think of capitalism in China is how does it work in a communist government system? How do capitalists safely make a profit in a communist country? There is an inherent risk in doing business there. No question about it. But the Lemmons feel that turning a profit in China helps to reduce our country's imbalance in the national economic situation. More simply put, if we are to compete with this economic giant, we have to play on their turf. Yes, there is substantial risk, but vision is required. Mike Lemmon and FFBT have accepted the fact that risk is necessary in order to advance this project. Time will tell, but the parties involved are innovative and attempting to move forward. In addition to the business aspects of the trip, I found it fascinating to learn about other parts of Chinese culture. The Chinese society has to abide by some very strict rules. For instance, the government enforces a one child per family rule. For several years, their society has favored male children over females. More recently the trend has been to the female side. Why? The most obvious answer is that after a generation or two, there is a disproportionate number of males and not enough females to match. The problem is easy to analyze. There needs to be an equal number of males and females in order to sustain the population. My next observation was the capitalism within China. If you think that the Chinese don't own businesses or property, you would be mistaken. The communist government allows its citizens to own and operate their own enterprises. They might be shopkeepers, farmers or businessmen, but they control their own destiny. It is one of the things about China that I never really expected. Free enterprise, no way! There is much more to tell about our trip. We visited several very interesting cities and traveled across the country by many different modes transportation. I will continue to tell you more about our experiences in China in my next few reports.
-30- State Rep. Bill Friend |
