Gov. Linda Lingle with other governors at the Opening Ceremony for Guangdong's 30th anniversary of its Province's sister-state/city/province relationships. (Photo courtesy of The Governor's Office)

Note: The following transcript is from the news conference in which Gov. Linda Lingle provided an update on her recent trip to China to promote tourism, international trade and clean energy partnerships.

I wanted to update everybody on my China trip. It’s very clear, or certain, that China has arrived as a global economic power, you can see it everywhere in China.

We went over with three specific goals in three areas that we were going to be focused on, tourism from China to Hawaii, energy collaborations and business in general, especially commercial products.

First of all I want to cover tourism and the potential for direct flights to Hawaii. My visit with the chairman of Hainan Airlines was important, it made a difference.

During my visit Hainan Airlines signed a memorandum of cooperation with the Department of Business, Economic Development and Tourism to establish working groups, and each side to appoint a liaison. The memorandum with Hainan Airlines sets up two things.

One, it sets up working groups from both sides and a specific liaison on each side, on Hainan’s side it’s the VP and head of marketing.

Hainan Airlines wants to come to Hawaii, there are several issues to resolve before they do. These include joint marketing programs between Hainan Airlines and Hawaii Tourism Authority, the visa issue which I will talk about in more detail, support for return leg flights – in other words when they come to Hawaii they need to make certain people are traveling back to China as well –  and finally various airport issues here in Honolulu.

I had a terrific meeting with Ambassador Jon Huntsman and the staff of the embassy in Beijing to discuss the visa issue. And we resolved several points.

Number one is that the embassy will appoint a point of contact for the state of Hawaii and all five consulates in China. This would help us any time there is a problem with the visas for an individual or a group. A scientific meeting, a conference, a student who wants to come to Hawaii, we’ll have a specific person who will be our state’s point of contact.

Secondly, they are setting group travel appointments and they are allowing the tour leader to sit in the interview so they will have set times for groups who are going to be traveling to Hawaii, they will be able to go and the person who leads the group will be able to attend the interview with the people traveling.

We also began discussions on what we call the last-minute visa process. We got a tremendous amount of cooperation and recognition for the importance of these issues to our economy in Hawaii. We also learned a lot from the embassy staff.

First of all 80 percent of all visas applied for in China are granted. That means four out of five people who apply, get a visa. Of those who don’t get a visa it’s often for a lack of a completed application, various paperwork is not done properly. I would also point out that the 80 percent that’s granted are granted for one year for multiple entries.

My own visa to go to China was for three months. So visas are being granted by our embassy for a one-year period of time and for multiple entries.

The information we got and the conversation we had there, we used, we leveraged at media roundtables in Beijing and in Shanghai. So we sat with members of the largest media in the county as well as the travel media and we shared with them the processes that we have been able to set up – about the consular point of contact, the 80 percent of the visas are currently being granted.

Because there is a disconnect between the perception of the difficulty of getting a visa and the reality of actually four out of five people who apply for a visa, get one. The points that we made with them about group travel in the future will really help as well.

Getting the information out was really important, and our information went out to hundreds of millions of people because that’s the number of people the media in China reaches.

The other issue I wanted to touch on is our energy partnerships. We went over to talk about energy with several people.

I think one of the most important meetings we had was hosted by the chairman of the China Academy of Engineering and he has agreed to support and be a part of our Asia-Pacific Energy Summit next year which will be Aug. 30 to Sept. 2.

This year was our first energy summit, we had 800 people attending – 600 from other countries.  And we had a focus this year on Korea.

Next year’s focus is on China, so having the government officially participate is very important for us. I also met in Hong Kong with the secretary of the environment who has energy as part of his portfolio, we also invited him to be a part of next year’s summit.

And finally, we had a memorandum of understanding between the Hainan Development and Reform Commission, which is a branch of the government, with DBEDT about the energy summit next year and the governor there is committed to attend.

Now why is Hainan island important in the energy issue? Hainan island is located off the southern coast of China and is one of our two sister provinces, Guangdong which I will talk about in a minute and Hainan island are both sister provinces.

And Hainan island has an undersea cable now between Hainan and the China mainland, and of course that’s a key part of our energy vision for Hawaii’s future so we had some very good opening discussions there.

Third point I want to talk about and the third goal and mission that we had is really exciting. This has to do with commercial products and services from Hawaii being sold in China. This was a potentially very powerful breakthrough that we had.

We met with officials from the Ministry of Commerce. Success of this initiative could significantly reduce the risks and the costs for small and medium sized business in Hawaii to do business in China. By the end of this year we will agree with the Ministry of Commerce on a plan.

We will sign an MOU to bring products and services from Hawaii to China. At the expense of the China government, they will set up in Shanghai, something called a “Hawaii House.”

This will contain Hawaii products and services, it will be both a wholesale and retail showroom so that anyone in China who is interested in purchasing Hawaii-made products will be able to come to one place and have samples of all of those products, will be able to order from that showroom – again with substantially reduced risk to our small and medium-sized businesses.

China is a huge country with 1.4 billion people. It’s hard to break in if you’re a small to medium sized company, yet there are huge opportunities for these companies in our state.

This liaison we’ve made with the Ministry of Commerce is going to be very, very important, whether it’s for logistics, distribution, media relations, all the things a small company will have trouble doing on their own will be able to happen through this Hawaii House.

So by the end of the year, we’ll agree on a plan and we’ll sign an MOU. In January or February of next year, the Ministry of Commerce will send a buying delegation to the State of Hawaii to travel from island to island to look at the products that they believe would best sell in the China market.

Very exciting opportunities for our businesses. We want them to be prepared to step up and take advantage of this opportunity. We’ll be working between now and then to get the word out about this to get as many specifics as we can. But this was a great step and I was very excited to be there and to listen to the specifics, and for them to actually pin down when they will visit Hawaii to review these different products.

Final point I want to make, a general point, besides the fact that we made such great progress in tourism and energy and in our commercial products to help our small and medium businesses is the fact that in China, government matters, government has to be involved in these issues.

It’s not just important, it’s expected in China. There are tremendous opportunities for Hawaii companies in China and our state is so well positioned to take advantage of those opportunities.

One, because the brand Hawaii is so well known in China and it’s known in a positive way. When you mention Hawaii, just as in other parts of the world, people’s faces light up. They all want to come, they know of it.

So anything with the name Hawaii attached to it is seen as good, and environmentally sound and positive, so we have that advantage going in.

We’re also a great counterbalance of the basic stress of living in China. Shanghai alone has 20 million people in the city. China this year will purchase more cars that the USA.

It has become a powerhouse and it’s intense, stressful kind of living, and they see Hawaii as a perfect counterbalance to that. We’re also a safe destination, and we have a unique culture, something they are very, very interested in.

Capturing these opportunities for our state will take work. Work on behalf of the government and work on behalf of the business community and this is especially true because of the highly competitive nature in China.

Everyone wants to be in China. It’s the only economy in the world right now that is growing 8-9 percent a year.

Other economies are lucky to be growing at 1-2 percent a year, and any article you read right now is clear on one thing: China is keeping the world’s economy going right now. So we have great opportunities, we have to be involved in making certain that we take advantage of them. And government is a key part of this effort.

I want to tell you that our prior efforts in China in 2005 or our large trade mission that we took was a huge part of our success this time. Also our trip last year in Shanghai to the travel mart was a big part of our success. Also as you know Hawaii is one of the few states in the county that has an office in Beijing.

We established it in 2005 and because of that office is why we made so much progress on the visa issue and on the ministry of commerce issue. Our chief there, Bo Wu, has worked with the Ministry of Commerce there so by the time the governor actually arrives there, all this ground work has been done.

Having that office in Beijing is a critical component of our future success in China.

The Hawaii Tourism Authority’s decision this week to spend money on the Shanghai Expo for 2010 was a very wise decision on their part. I’m very excited about it.

I’ll be there in Shanghai for that expo as well as to attend ceremonies honoring the 25th anniversary of our sister-state/province relationship with Guangdong.

It will be a much larger trip next year, we will invite members of the community, business community, education community to travel with us on that trip and we certainly hope the media will make that trip. It is going to be a very important one.

The 25th anniversary is seen as a major milestone in Guangdong and the Shanghai Expo will attract 73 million people during the five months that it’s open. Out of these 73 million people 70 million will be from China. It is an unprecedented opportunity for us, so I look forward to that.

Media Q&A:

* Getting back to the tourism… can you sum it up in a nutshell?  This is big news for Hawaii tourism. This is you paving the way to tap the big Chinese market.

This is potentially very big news for the future of tourism in Hawaii. It will bring back a lot of jobs if we’re successful at bringing it about. I think there are some steps that have to be taken between now and then.

The HTA’s involvement is going to be important and their decision about the Shanghai Expo was very, very important. The head of HTA, Kelvin Bloom, was with me on this trip in both Beijing and Shanghai. He has come to understand the significance of this market. I think he knew it kind of before, but this was his first trip to China. I think it really influenced his thinking.

He wasn’t with me in Hainan island when I met with the chairman of the board of Hainan Airlines, but that was an extremely significant meeting. Again, he’s the head of the airline, he doesn’t really want to meet with the head of HTA, he wants to meet with the governor of the State of Hawaii. That’s simply the way it is, for him and for the airline.

He’s an interesting man. He’s a former high-level government official there – worked for the Aviation Administration. He is now seen as the top entrepreneur when it comes to air service in China so if anyone would do direct flights, it will be him. That’s why it’s so important to establish this relationship and to work with him. Having these working groups set up and liaisons is a very important step but we have a little ways to go.

* Energy partnership with China – what do we, who provides what?  You said that island there provides a cable, is that technology we might use here?

It’s certainly possible. I can see another area, Dick. We have people here right now who are involved in some wind projects. China is now the most successful wind turbine producer in the world. Now, instead of producing the 1.5 megawatts, they are producing 2 megawatt wind turbines.

They just made a very big sale to Texas. You may have read about it – there was some controversy attached to it because there were ARRA funds used. Clearly they are manufacturing some of the highest quality wind turbines available.

So to the extent that our companies who want to do business here, want to purchase wind turbines, available. So to the extent our companies who are doing business here want to purchase turbines in China, that’s a great opportunity for them.

The less expensively they can put up those turbines, the less expensively we can buy power.

Also the Academy of Engineering over there is a critically important partner for us. They’re involved in all kinds of renewable energy, so I think there’s a lot of opportunity to learn from each other.  Having them come here – once the official government agency said they will be a partner in our conference, they will be attending – there will be a lot of Chinese companies coming here for that conference. A lot of opportunity.