An October 27, 2014 article in the Dutch “Het Financieel Dagblad” newspaper praises the positive assets of the North East Ohio region. The author credits the shale revolution for helping to create an industrial renaissance that has drawn dozens of Dutch companies to the region. For the article, our NACC President Bernardine van Kessel was interviewed.
Former American “rustbelt” turns out to be a magnet for Dutch companies
Het Financieel Dagblad
By Marcel de Boer
Monday October 27, 2014
Local policymakers like to suggest that the economic turn-around was due to the decision to fix the sports stadiums, making the inner cities in the state of Ohio livable and appealing again. It is very clear that the State of Ohio, especially the counties surrounding Cleveland, is seeing an economic recovery again thanks to the shale revolution.
Dutch companies are riding the wave of this success, says Bernardine van Kessel, Director with Team NEO, a non-profit organization that attracts companies to Northeast Ohio. In recent years, several dozen Dutch companies have descended upon the region that lies half-way between Chicago and New York City, to benefit from the industrial renaissance that has been occurring. Akzo Nobel and Philips employ more than 1,000 people in their local facilities.
For more than three decades an enormous exodus had taken place, states the Dutch woman who landed in the US via a field hockey scholarship and who stuck around afterwards. Ohio, the state where John Rockefeller started his oil-imperium, where Wilbur and Orville Wright built their airplane factory and where aerospace icons John Glenn and Neil Armstrong were born, transformed along with other states south of the Great Lakes into the “rustbelt”.
But the tide has turned. In the United States there is a phenomenon that has been called “the Great Homecoming”. Many industrial companies are re-considering their offshored facilities and are repatriating their production to the United States. Areas that are part of the shale revolution, such as eastern Ohio which is part of the western part of the Utica Shale formation, are under consideration as part of this phenomenon, explains Van Kessel. “This is not only one of the largest, but also one of the richest shale regions. The minerals are easily converted into raw materials for the plastics industry. To this effect, Shell for example is building a cracker facility just over the border in Pennsylvania.”
Slowly, the region is starting to experience how this upstream development, meaning the oil and gas exploration, is being turned into downstream applications. For example, the farmers that earn money for the mineral and exploration rights from their properties are now investing in new machinery and farm equipment. A company such as John Deere profits from this, but also Goodyear. The tire maker is in turn a client of VMI, a subsidiary of (Dutch co) Twentsche Kabel, which has a facility in the region.
“Many of the buildings that had been left empty over the thirty plus year exodus are being restored and leased”, says Van Kessel. She stresses that Ohio’s industrial base has always been diverse, in contrast to that of the economy of Michigan which traditionally has leaned on the auto and furniture industries. And now you see the flourishing of all of those different economic sectors: automotive, aerospace and defense industry, polymers and coatings, the biomedical sector and also the services industry and metalworking sectors. No wonder that companies such as Akzo, Philips, Randstad, Stork, Wolters Kluwer, CSM and Tata Steel now have Ohio facilities.
In order to unlock the hinterland and to tie into the world of global commerce, the Cleveland Port Authority has started a regularly scheduled container service with Amsterdam-based shipping company Spliethoff. Since April, a ship sails between the City of Antwerp and the city along Lake Erie, or, in the words of Bart Peters, Director of the Atlantic Department of the shipping company: “between Europe and the North-American heartland”. The shipping service has become such a success that Spliethoff announced last month that it will sail to and from Ohio not once but twice per month.
Cleveland and its surrounding area appear to be a true magnet for Dutch people, Van Kessel says. The cost of doing business and the cost of living are much lower than in Chicago or in New York City. The hourly wages and commercial lease rates are far below those in the large urban areas in the US. In addition, as an advantage for the Dutch people in the Cleveland area, a Dutch school was recently founded. This provides an extra appealing factor for the expats in the region.