Austin Partners With Chinese Online Retail Giant Alibaba To Boost Texas Products – But Can It Work?

Austin is the only city in the U.S. with a partnership like this with Alibaba, but Texas companies have yet to break in.

By Joy DiazMarch 23, 2018 1:26 pm|

China said on Friday that it plans to impose tariffs on American fruit, pork and wine among other products. The announcement comes a day after President Trump signed a memo proposing $60 billion in tariffs on Chinese-made products.

Trump said the tariffs are part of an ongoing negotiation with the Chinese to address what he called “the largest trade deficit of any country in the history of our world.”

Those Texans paying particularly close attention to this back and forth over trade with China are of course business owners affected by these tariffs. But also potentially affected are those are business leaders hoping to break into the Chinese market.

Joshua Eisenman, an expert on China at the University of Texas LBJ School of Public Affairs, says the lure of expanding a business by opening up sales to China is at least a century old – but only relatively recently a viable possibility.

“The concept of the massive China market has been the kind of siren song that got us to admit China to the WTO and has had so many foreign businesses salivating for so long,” Eisenman says.

And it’s true the Chinese market is huge – close to 1.4 billion people. But what does a business in Texas need to do to break into it? The truth is, nobody knows exactly.

Casey Smith with the City of Austin’s Economic Development Office says one possible entry point could be Alibaba, China’s online market.

Together, Alibaba and the City of Austin threw a live pitch event with music, interviews with city officials, and companies pitching to vendors. It was all being transmitted live to viewers in China. Austin is the only city in the U.S. with a partnership like this with Alibaba, but Texas companies have yet to break in. That’s why the event was a chance for companies to refine their pitches for Chinese consumers.

On the night of the live pitch event, Jen Du looked straight into the camera and calmly talked about her product, a drink she calls a “premium alcohol detox drink” designed for Asian people who often become flushed after drinking alcohol. Still, one week later, not a single order had come in – not for her product and not for any of the other products that were on display that night.

Eisenman says he’s not surprised that American business owners have a hard time capturing their interest, since the middle class in China has access to every product on the planet.

For now, it’s back to square one.

Photos: Joy Diaz