A Chinese fiber manufacturer is opening a plant in South Carolina, an investment that counters President-elect Donald Trump’s campaign criticism of Beijing for allegedly stealing American jobs.
South Carolina Gov. Nikki Haley, nominated by Trump to be the U.S. ambassador to the United Nations, hailed the decision by Labon, a Shanghai-based company, to spend $3.1 million refurbishing a factory in Orangeburg, South Carolina.
“It’s special any time a company decides to invest in one of our rural counties because it drastically improves the lives of those in the area,” Haley said.
Hongxin Chen, general manager of Labon, said his firm is excited to be launching its first operation in the United States.
“Between the skilled workforce and friendly business climate, this decision was easy for us,” he said. “This development will allow us not only to accommodate our continued business growth, but to better serve our customers as well.”
The move by Labon is a rare counter to the outflow of textile jobs from the South in recent decades. It also offers a counter-narrative to Trump’s frequent lament that China is luring American firms with cheap labor and financial incentives.
Labon’s investment continues a trend that has seen China invest almost $100 billion in the United States since 2000, buying or supporting 1,900 companies in deals that have save or created almost 100,000 jobs.
The 15,700-square-foot plant in Orangeburg is expected to employ 23 people when it opens next month. In a sign of how the internet is breaking down boundaries and shrinking distances, Labon is accepting applications at an email address, firstname.lastname@example.org.
With a population of just under 14,000, Orangeburg is the capital of the South Carolina county by the same name. It is 75 miles northwest of Charleston, a larger and more cosmopolitan ocean city that’s a major tourist draw.
One of the possible pitfalls for Labon is a potential review by a secretive multi-agency federal panel called the Committee on Foreign Investment in the United States. It’s comprised of senior representatives from the Pentagon, the Commerce Department, the State Department, the Treasury Department, the Justice Department and other top agencies.
CFIUS, as the committee is known, vets dozens of purchases of and investments in American companies by foreign firms for conceivable national security risks ranging from access to sensitive technology or information to proximity to critical infrastructure.
Among other Chinese deals, CFIUS early last year approved the sale of New York’s fabled Waldorf Astoria hotel, which serves as the home-away-from-home for visiting presidents and other dignitaries, to the Anbang Insurance Group in Beijing, one of China’s biggest insurance firms.
Ironically, the hotel contains the residence of the United States’ chief UN envoy, so Haley will live there when the international assembly is in session if the Senate confirms her nomination.
While CFIUS normally doesn’t investigate foreign “greenfields” investments where the purchaser is building from scratch instead of buying an existing company, the Labon factory’s proximity to major military facilities could draw scrutiny.
Joint Base Charleston, 67 miles east of the new factory, is a sprawling, almost 21,000-acre complex run by the U.S. Air Force but also including Army, Navy, Marines and Coast Guard facilities. It is home to the 628th Air Base Wing and other units that provide critical airlift of troops, military equipment and medical supplies around the globe.
The base also subleases 231 acres to a broad range of key federal agencies, among them the State Department, the Homeland Security Department, Customs and Border Protection, the Food and Drug Administration, and the National Oceanic and Atmospheric Administration.
Just to the east of Joint Base Charleston, 60 miles from Orangeburg in Goose Creek, South Carolina, is a still-more sensitive military facility. The Naval Nuclear Power Training Command produces the commanders and captains who helm the nation’s fleet of nuclear-powered and ballistic-missile submarines.
Labon specializes in the research, development and manufacture of technical fibers and textiles for use in sealants, hand-protectors, flame retardants and other products.
Haley has built a national reputation for helping bring companies to South Carolina, partly through tax breaks that some have criticized as a form of corporate welfare.
At a White House ceremony in January 2012, President Barack Obama praised business leaders from South Carolina and other states for keeping jobs in the country.
“You heard of outsourcing,” Obama said then. “Well, these companies are in-sourcing. These companies are choosing to invest in the one country with the most productive workers, the best universities, and the most creative and innovative entrepreneurs in the world.”
Republican Sen. Lindsey Graham of South Carolina has been among the most outspoken critics of China for devaluing its currency, which he and others say helps it draw jobs from the United States.
Led by Graham, fellow Republican Jeff Sessions of Alabama, Trump’s nominee to be attorney general, and Democratic Sen. Charles Schumer of New York, the Senate in 2011 passed a bill imposing trade sanctions on China. The House had approved a similar measure a year earlier, but that was in a different session of Congress, so no legislation ever reached Obama’s desk.