Chinese Company Opens First US Plant in Northeast Arkansas

China Asia

On June 15, 2018, Jonesboro, Arkansas welcomed the construction of a 1500-acre manufacturing plant by Hefei Risever Machinery Company. Risever broke ground only eight months after it announced plans for the $20 million facility in Craighead Technology Park, the company’s first in North America. A surge of investment to Arkansas from China’s private sector began in 2015. Risever, which makes parts for heavy equipment brands such as Volvo, Caterpillar, and Komatsu, is the fifth China-based company to operate in the state to date.

Jonesboro faced tough competition to attract foreign direct investment: Risever surveyed 70 cities in 5 states before sealing the deal. Asked why the city stood out, Risever General Manager Yonggang Lai pointed to the convenient location, developed infrastructure, and skilled workforce. Also critical was the cost of doing business and public-private support for investment. In addition to payroll rebates and sales tax refunds, the company received $1 million from a state incentive fund and a $100,000 training grant. Construction is set to finish in July 2019.

China features prominently in Arkansas Governor Asa Hutchinson’s plan to attract foreign manufacturing. Since taking office in 2015, Hutchinson has visited China three times and hosted six delegations from China. The five Chinese companies Hutchinson visited late last year have located their businesses in Jonesboro, Little Rock, Danville, Arkadelphia, and Forrest City. Together, these projects will provide 1,650 new jobs and $1.8 billion in investments. In 2017 alone, Greenfield investment from China into Arkansas totaled $435 million.

Across the United States, Chinese firms have made their mark on local economies. Neighboring Pennsylvania is home to a new R&D facility of an eminent Chinese waterproof technology manufacturer. An assembly plant in Indiana will undergo renovation, as China-owned carmaker SF Motors acquired the plant from an American manufacturer late last year.

China is not the only East Asian country present. Months after SF Motors’ announcement, a Korean steel producer inaugurated its new plant at the Port of Indiana-Jeffersonville. To Arkansas’ East, Tennessee recently secured a $190 million investment from a Japanese auto parts manufacturer as the firm expands its US production capacity.

Cathy Dao is a research intern at the East-West Center in Washington D.C. She is currently an undergraduate at Stanford University, studying Political Science and Science, Technology and Society. Image Credit: KASU, Brandon Tabor.