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PROMOTING THE PACIFIC RIM: ALASKA, ASIA, AND MINING MONEY
by Kathryn G. Arlen

For the United States, already challenged by serious economic disruption, including both trade dependence and imbalance with China, Alaska's rich mineral industry and unique access to the Asian world serves both our state and our country well, providing an enviable bargaining position. Supporting responsible environmental stewardship and a powerful, growing, conscientious awareness of other countries' needs is vital not only for Alaska's economic status, but for advancing critical socio-economic awareness inherent to the never-ending globalization process.

In many ways Alaska can be viewed as the "window of trade to Asia," as Carlos Gutierrez, former U.S. Secretary of Commerce, observed when addressing the Greater Fairbanks Chamber of Commerce in a 2008 visit. Capitalizing on that position is the fact that: "We're selling the building blocks of economic development," as Greg Wolf, Executive Director, World Trade Center Alaska, recently commented. "We are in the right place, the Pacific Rim, at the right time, when Asian and emerging markets are growing rapidly." And Alaska has for many years established itself as having a stable and transparent business climate. "Countries are not going to be surprised and know in advance what the rules and regulations are," added Patricia Eckert, trade specialist with the Governor's Office of International Trade.

Mining exports play a predominant role in the Last Frontier's Asian relationships. The Resource Development Council for Alaska, Inc. lists minerals as the state's second largest export commodity [behind seafood] and that 40% "are bound for Asia, primarily China, Korea, and Japan." (2007 statistics) More current numbers provided reveal that for just zinc alone ($691 million,) 70% went to Japan, China, and Korea, in that order. When asked what type of future mineral export expansion we can visualize, Eckert commented: "I think it has to be done on an industry-by-industry basis. Traditionally Japan is our biggest single export market. China is number two-- the first time they have been in that spot (formerly held by Korea.)"

Alaska and South Korea have enjoyed a positive trade relationship for many years, thanks to former Gov. Wally Hickel's original initiative helping establish a state trade office in Seoul and the country's original consulate here. The consulate was re-established in June 2008, and its presence is "probably the most significant thing that has happened in the AK/South Korean relationship in the last few years," Ms. Eckert emphasized. Additional benefits are garnered from the U.S.-Korea Free Trade Agreement enhancing market access by allowing 95% of U.S. exports as duty-free within a certain time-frame. Special visa programs awarded Alaska from both the U.S. Embassy and the Department of Homeland Security also promotes social and economic relationships with Korean visitors.

Gaining that status from Homeland Security is critical for facilitating trade, travel, and commerce, she added, "And it is also important as a sign of how valuable the relationship is."
Korean Consul Hee-chul Kim agreed: "South Korea and Alaska have a very good relationship, especially when it comes to trade. As consul here I am eager to promote both countries in areas of trade." One critical commodity is coal, and since it can be a "mineral to replace oil and gas," the Consul remarked, "I'd like to see some Korean companies import Alaskan coal. I am ready to help Korean companies who have some interest in the Alaska mineral industry,"
Japan has also enjoyed positive economic relations with Alaska for many years, again, another vestige of Gov. Hickel's influence dating back to the 1950's when Hickel helped open the Tongass National Forest for Japanese wood product supplies and creating the Sitka and Ketchikan pulp mills. Hickel's devout interest in Japan continued into the 1960's while first pitching the importance of LNG (liquefied natural gas,) and his influence still enhances our mutually cordial economic and diplomatic relationship.

Japan's current needs, as for most Asian nations, focus on coal, zinc, lead, any industrial mineral resources, and gold, which introduces the next evolutionary step in the Alaska-Asian trade metamorphosis: investment. In late April 2009 Sumitomo Metal Mining Co., Japan's top gold producer and, at that time, 51% shareholder of Pogo gold mine, announced their acquisition of the remaining 40% interest. (Nine per cent allocated to Sumitomo Corp.)

Initial owner Teck Cominco sold out for its own economic interests, yet the Japanese steadfast interest in researching potentially lucrative properties and acquiring appropriate stock interests sends us a powerfully positive message and reminder about our natural resources supply and industry. "When you invest anywhere--choosing is a 'vote of confidence,'" Wolf has observed, noting that China is also rapidly becoming a heavy player in the investment strategy game, and promoting U.S. economic benefits from China has helped diminish its former notoriety as the "Yellow Menace"
Today, twenty years after the event, you could walk the streets of Beijing and try to subtly inquire about the 1989 Tiananmen Square protest and anyone responding would probably claim (truthfully) that they don't know about it, or remember, or prefer not to discuss it at all. Stereotypes reminiscent of the Cold War are finally fading from practical memory as a new, younger generation comes to power with both a hunger for Western Society's material advantages and an inborn respect for their ancient culture's harmony and balance values. We do enjoy a financial co-dependency with China, like it or not, for better or worse. Yet our mutual economic interests are also breaking down tired old social prejudices, one encounter at a time.

For China and the rest of Asia, Alaska needs to consistently create and promote an open-door policy for business and, in particular, for the mining industry. Keeping an open mind and attitude about mineral development is imperative, as Prof. Doug Goering, Dean of University of Alaska Fairbanks College of Engineering and Mines, concludes. "We have to continue to look at projects that make sense, like Pebble [a massive copper and gold deposit in southwest Alaska] and others that are going to have a huge impact on our economy and the needs of the nation, and, in fact, the needs of the world."

Kathryn G. Arlen is a communication consultant and freelance writer in Fairbanks, AK, and can be reached at mindmerger@hotmail.com.