Forging ties with China suits Locke
Seattle Times business reporter
STEVE RINGMAN / THE SEATTLE TIMES
STEVE RINGMAN / THE SEATTLE TIMES
DAVIS WRIGHT TREMAINE
DAVIS WRIGHT TREMAINE
While he was the country's first Chinese-American governor, Gary Locke traveled to China to open doors for Washington state. Less than two years after leaving office, he's become another kind of power broker, opening doors for big-name clients like Microsoft and Starbucks.
Locke has parlayed his experience and ancestry to an elevated perch at the apex of power in a country where politicians still have a heavy hand in business.
Witness his central role in helping to arrange Chinese President Hu Jintao's April visit to the U.S., a trip that included stops at Boeing and Microsoft. More recently, Locke sat down for a one-on-one meeting with Premier Wen Jiabao, whose stature in China is outranked only by Hu. The two met for more than an hour inside the walls of Zhongnanhai, the central government's leadership compound in Beijing.
In these and other situations, Locke is crafting an influential position in his post-government life, one that could produce a legacy of greater impact than his terms as governor.
"In many ways, what I'm doing now is an expansion of one of my many jobs as governor — to promote Washington," said Locke, a partner in the law firm Davis Wright Tremaine.
But China has been the biggest draw for the 56-year-old Locke personally, and success there has come easier than in Olympia. As he straddles a role between business and diplomacy, he hopes the trans-Pacific opportunities he uncovers will show China's growth doesn't harm Americans.
Locke's emerging role took shape in his visit with Wen in July. Locke used the opportunity to bring up issues important to his clients, such as intellectual property. He listened intently to Wen talk about China's development strategy, and then mentioned Microsoft, Starbucks, Weyerhaeuser and other local companies he thought could help.
During the six-day visit, Locke also met with three government ministers and China's top banking and securities regulators. He handed out $40 bottles of Chateau Ste. Michelle merlot; China's foreign minister gave Locke a book of poetry he'd written himself.
Locke said he made the trip to build upon ties cemented during Hu's visit. It was a handsome reward to Locke and his firm for helping bring Hu to Seattle and ensuring a smooth visit, despite protests over China's human-rights record and other concerns. Face time with a Chinese president or premier is rare.
"It speaks volumes," said Joseph Borich, president of the Washington State China Relations Council. Such meetings are reserved for people who are "extremely well-liked and/or very influential. I think it reflects well on Gary and the state of Washington and the appreciation the Chinese leadership feels."
It also reflects a desire by China's leaders to cultivate allies at a time when political relations between the United States and China have soured, observers said.
"There are few statesmen these days on either side when it comes to U.S.-China relations," said James McGregor, a Beijing-based consultant and author of the book "One Billion Customers: Lessons From the Front Lines of Doing Business in China." To fill the void, he said, "it would make sense for them to cultivate former Gov. Locke."
Or, as Locke himself recently told a gathering of the state China Relations Council: "Government ties have reached their limit. Neither country is willing to give the other an inch on major issues."
As a result, Chinese leaders are looking toward people like Locke to serve as a bridge to the U.S., where they hope to invest, said Norm Page, co-chair of Davis Wright Tremaine's China Practice Group, who accompanied Locke on the trip.
Break for a bank?
Such high-level schmoozing has payoffs. In July, Locke met with China's top banking regulator to discuss opening the industry to increased outside investment and competition.
One of Locke's clients, a large, multinational company, owns a banking subsidiary that wanted to open a bank in China. But the bank didn't meet China's conditions of assets over $10 billion and a two-year history of operating there, Locke said.
"At the end of the conversation, I did bring up the name of this company," Locke said. "I said we'd love to work with you in finding a creative way to achieve your objectives as well as help this company." He suggested that regulators make an exception, since the bank's parent company met the requirements.
"If the commissioner who oversees the banking industry is receptive, then those people underneath him will be receptive," Locke said. "If you just go to a midlevel bureaucrat, they're just going to go by the letter of the law and say no, no, no."
The meeting turned out well, Locke said: "The chairman of the banking commission said great. So we're going to follow up."
A frequent flier
Locke said he has been traveling to China five times a year helping U.S. companies, and now he's taking on Chinese clients that want to establish themselves in the state, though he won't identify them.
Locke, who speaks "a little bit" of the southern Taishan dialect but uses English and an interpreter on his trips, said his firm represents companies in financial services, technology, transportation, investment guidance, medicine and education. (Davis Wright Tremaine also represents The Seattle Times on First Amendment and other legal issues.)
Last year, Starbucks invited him to the grand opening of its store at the Great Wall.
In July, he was awarded an honorary doctorate from Peking University.
"There's so much affection for Washington state institutions. ... We can use it as an opportunity to make further progress," he said.
During the meeting with Wen on July 10, the premier was "still beaming and talking about [Hu Jintao's] visit," Locke said. "They were all very elated over the great reception Washington state accorded them."
Locke commented to Wen that he and the Seattle organizers should have handled Hu's visit to the White House, too. "He had a good laugh at that," he said.
While Hu received hugs at Boeing and a dinner at the home of Microsoft Chairman Bill Gates, a series of gaffes followed in Washington, D.C.
There was no state dinner at the White House, and an announcer mistakenly called his country the Republic of China, the official name of Taiwan. Later an activist from the Falun Gong movement who had been given press credentials heckled Hu's speech at the White House.
Issues beyond business
Yet some say the focus on business opportunity in Seattle overlooked human rights, Internet censorship, unease about China's growing influence and other critical issues.
"It was all about promoting ties and figuring out ways to ensure that the patterns of cooperation get deepened without confronting the fact that there are legitimate reasons why people are concerned about China," said David Bachman, a University of Washington political-science professor who participated in the Seattle events. "The business point of view is one point of view."
Indeed, one reason Chinese leaders reach out to Locke may be because they can avoid uncomfortable conversations. "They trust Gary, and they trust him not to bring up the most difficult issues in the relationship, or to keep them in a very compartmentalized part of the dialogue," Bachman said.
Locke said he's never refrained from bringing up hard questions. But he prefers encouragement to criticism. "I very much want greater freedoms and democracy in China," he said. The U.S. should allow more Chinese to visit "so they can see how our democratic forms of liberties actually enhance our quality of life."
While enthusiastic about the possibilities, Locke has not revealed any breakthroughs or deals five months after Hu came to Seattle.
What he or anyone else in the state can achieve is limited by larger factors such as U.S. visa policies, export controls and issues involving Taiwan, North Korea and Iran.
"The issues related to security and world order will continue to come in from time to time. That will limit how effectively business can lobby for future expansion of the relationship," Bachman said.
Fears getting in way
But Locke's efforts could help ease fears about China.
Two decades after the Japan-bashing of the 1980s, China is often portrayed as yet another rising Asian giant and a potential threat, said Robert Kapp, former head of the U.S.-China Business Council who now runs a consulting firm in Port Townsend.
Such perceptions can quash deals potentially beneficial to Americans, he said.
"The Chinese are rich with foreign exchange and they want to do something with it," Kapp said. "Every governor and every mayor in the U.S. is saying bring your money here. It's important that Washington state be as receptive as it possibly can."
At the same time, in a political atmosphere charged with "almost morbid sensitivity over China's emergence as a global economic power and increasingly as a military power," Kapp said, "you don't want to come across as whitewashing or apologizing or making the Chinese look great.
"We must never lose sight of the fact that being close to China has to coexist with a clear perception of the political sensitivities in the U.S.," he said.
Trade as a starting point
Locke said he believes trade opens the door to political cooperation.
"I'm an American through and through," he said. "I believe it's in the interests of the United States politically and economically to forge a strong partnership with China.
"If the Chinese can't buy U.S. products, they'll buy them from European countries and then develop stronger economic ties with France and Germany and perhaps side more with those countries when international issues flare up."
At an impasse with the U.S. on many issues, the Chinese said they are waiting to see who the next American president will be in 2008, according to Locke.
As a high-level intermediary, Locke may envision a greater political role for himself now than when he was governor.
"If Locke uses his unique stature as America's most prominent ethnic Chinese politician shrewdly, he will have access to the top in China, and he could become a statesman from the Democratic side in regard to China issues," McGregor said.
But that probably wouldn't happen if he lived in Iowa. "Washington state gets special attention from the Chinese for two reasons," he added. "Boeing and Microsoft."
Kristi Heim: 206-464-2718 or email@example.com
Copyright © 2006 The Seattle Times Company