Recently announced as the Deputy Assistant Secretary of Commerce for China, Patrick Santillo is the right man for the job, having spent 30 years working in the US Department of Commerce, five of which were in Asia. He tells why Hong Kong is crucial to his task, and what lies ahead

By Blessing Waung

Earlier this year, Patrick Santillo visited Hong Kong for the SelectUSA Roadshow across China, as well as to meet with key members of the Hong Kong Trade and Development Council. In his current role, Santillo presides over a team of more than 160 professionals in the US and overseas dedicated to opening foreign markets to American products, protecting US commercial interests abroad, promoting US exports and encouraging foreign direct investment into the United States.

He advises the leadership of the Department of Commerce on trade policy issues regarding the bilateral commercial relationship between the United States and China and he helps shape the Department’s trade promotion agenda. Previously, he served as the Regional Senior Commercial Officer-ASEAN at the US Embassy in Singapore and as the Regional Director for East Asia and the Pacific for the US Department of Commerce, supporting Commercial Service operations in 13 countries in the region, including China.

Patrick Santillo (center)
Patrick Santillo (center) What can you say about Hong Kong’s competitiveness?

Santillo: Hong Kong has an intellectual depth that maybe no one else anywhere has. And I say that very carefully, because I have a lot of friends in Singapore. I know that Singapore has an intellectual depth too, but when it really comes to the ability to understand the region, I think Hong Kong plays a unique role. I don’t think that the others have yet that intellectual depth of understanding all the sides involved.

These are really complicated. Human relations, country relations and regional relations are complicated. Hong Kong has a very rich and vibrant tradition of being able to manage that stress. There is stress there. How do you manage that stress? I think you have a breadth and depth of experience at managing that no one else can hold. You’ve got an American perspective.

You’ve got a body of knowledge here that is unrivaled. Really, I have to go far and wide to find that critical mass of intellect. Others can now out manufacture you. Others could have a larger stock market. Others could process more financial transactions than you do ultimately just because of size, but I think it’s going to be a long time to get the intellectual depth that you have. The US has historically been an underperformer in terms of exporting in the past, focusing mostly on border countries. But lately there is a shift in its focus. Could you speak about what you see going forward?

Santillo: I’ve been in Commerce for quite a long time. I think there is a concerted effort to get US companies more engaged with exporting. I think their level of knowledge has gone up, but I think even things like the Internet have changed how we counsel our companies. A number of our offices are becoming more progressive in promoting the opportunities through social media in ways that even three years ago we were not doing.

People are really making the push to get more companies involved in exporting. I do think that more companies are coming into the markets. More companies recognize Asia and the importance of Asia. They trust Hong Kong to kind of play that role and help them navigate some of these tougher areas. Pertaining to intellectual property and what goes on in this region, could you speak to your experience and agenda in that arena?

Santillo: What we have heard from the US companies is more with regards to China than it is with regards to Hong Kong, but again, how can Hong Kong help us, right? Hong Kong obviously has managed IPR well. Obviously, [Hong Kong] has managed regulatory transparency very well. Things that our US companies talk about is they are interested in China. They want to do business in China but they keep coming up with these same handfuls of issues that make it more and more difficult to do business in China. So how can we learn from what Hong Kong has done in helping us to understand what we can do in China and share those experiences at that expertise? Again, just understanding from the US companies, what’s working here, it could work better there and how could that model be applied.

That’s not to say that we are going to have Hong Kong telling China what it needs to do. If we can talk about how it’s done here that may help us strengthen [our case]. Because obviously Hong Kong has done it well, has been successful, and has grown companies and they’ve gone global. So whatever the model is, it has clearly worked. If countries, cities or provinces aspire to that, then what are the takeaway lessons they really need to learn, and how could we use lessons learned in Hong Kong to help shape that growth agenda. Regarding the dialogues you are participating in the latter half of the year, what results have you seen from what you’ve already been doing and what are you going back to do?

Santillo: As we look at the remainder of 2015, we have a very busy engagement agenda with China. I would include Hong Kong in that engagement. With China, we have a very robust engagement with the strategic economic dialogue that will take place in Washington. That is really that higher level, really trying to get some of the macroeconomic underpinnings that can help us all be more competitive and grow the system.

In September, we will have President Xi [Jinping] coming to the United States for a state visit. That will be really a good opportunity for us again to exchange honest views and to celebrate what we are doing well together. We are doing a lot of things well together. We want to make sure that which we are doing well together is getting equal play with that which we have [submissions] about.

It’s logical they were going to have issues… we are going to be friends and competitors. It’s logical. But we want to make sure that that is the balanced equation. And then we end the year with JCCT that will take place in China and that allows us to really get into some of the more practical aspects of the relationship and really dive into some of the more detailed market access issues where we might be sector specific. What is the importance of SelectUSA?

Santillo: Global competition for foreign direct investment is severe and tough. So we can make no mistake about that. The reputational risk was that the US didn’t care. We weren’t open for business and we closed off our borders. The reality is we remained open, taking more foreign direct investment than anybody else. That’s the reality. But that was not the perception. So we had a very severe case of reputational risk.

I think SelectUSA has gone in a long way in eliminating that reputational risk. If you get the President of the United States, if you get four Secretaries in the Cabinet, if you get Twitter, Facebook and every social media network buzzing, if you saw all the articles that came out of that summit, they are virtually all positive. We are changing the narrative of United States being open for business. We are aggressively getting the word out about that.

AmCham as individual members has service providers who have it as part of their mandate to promote investment. What we are trying to do is bring foreign companies back into the United States. So to the extent that you have members whose business model is to be a service provider in that regard, we really want to work very closely with them. It’s good all the way around.