State Lures Japan's Kikkoman for Plant


Proximity to large Asian American communities, discounted power rates and training subsidies helped persuade Japan's largest soy sauce manufacturer to choose California over Oregon as the site for a $35-million manufacturing plant, Gov. Pete Wilson announced Wednesday.

Wilson said Kikkoman picked Folsom over Corvallis, Ore., despite a lucrative offer from the Oregon city that included free land to build the facility.

Kikkoman's decision marks the latest payoff for California in an aggressive campaign to lure foreign investors to the state. Matsushita Electrical Industrial Co. and JVC also recently chose California for the sites of new digital videodisc plants.

Wilson fears Asians are shying away from California because of its reputation as a high-priced, over-regulated place to operate. But he said his administration is working to change that image by lowering corporate taxes and reducing "burdensome, excessive regulations."

The governor said Folsom city officials also agreed to expedite the permitting process and reduce property taxes for the Japanese giant, which operates sales offices in Los Angeles and San Francisco and a plant in Wisconsin. The Sacramento Municipal Utility District threw in discounted power and the state offered $50,000 in training funds.

Kikkoman paid about $500,000 for the Folsom site, according to Chris Holben, an undersecretary in the California Trade and Commerce Agency. The company will break ground next month on the 40-employee plant.

A prolonged recession has led to the closure of a number of Japanese branch offices in California in recent years, but Japan remains the state's largest trading partner. In 1995, California exported $16.5-billion worth of goods to Japan and the country has invested $34 billion here.

While the governor expects Japan and Korea to remain key trading partners, he is particularly keen on expanding trade with Southeast Asia and China. The state recently opened an office in Jakarta, Indonesia.

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