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Scott Walker, governor of Wisconsin since 2011, tells Sebastian Shehadi why Taiwanese electronics giant Foxconn decided to build a $10bn plant in Milwaukee, and how the state has prepared for the development's social and environmental effects.

Q: What were the main factors that led Foxconn to pick Wisconsin?

A: Wisconsin competed against several other states for this once-in-a-generation economic development opportunity, including a couple that offered larger incentives than we did. In the end, there were several reasons the company chose Wisconsin, including the strong business climate in our state, the outstanding education system and the dedicated workforce, which is critical to the company as it plans to create up to 13,000 jobs here.

Wisconsin’s rich manufacturing legacy – which includes iconic companies such as Harley-Davidson and Briggs & Stratton – also was a factor in Foxconn’s decision. We are going to build upon that heritage by creating an advanced manufacturing campus that will be the first of its kind in the US. Foxconn was also impressed by the co-ordinated response it received from local, county and state representatives and by the efficiency we demonstrated in developing our proposal.

Q: Is the Foxconn deal a win for president Trump? 

A: President Trump played an important role in ensuring that Wisconsin was on Foxconn’s radar screen by initially suggesting to chairman Terry Gou that the company consider investing in our state. Pro-business federal policies such as easing regulations and reforming our tax system, coupled with the many reforms Wisconsin has made in the past seven years, are providing Foxconn and other businesses with the environment they need to succeed in the long run.

Q: Are you confident that Foxconn can keep its contractual financial pledges? 

A: With annual revenues of $135bn, Foxconn is ranked 27th on Fortune’s Global 500 list of the top companies in the world, and is tied with Amazon.com as the world’s third-largest technology company. So we are indeed confident that Foxconn has the resources to follow through with its commitments to the state of Wisconsin.

That being said, before the state’s contract with Foxconn was finalised, the Wisconsin Economic Development Corporation’s underwriting team, attorneys and other staff conducted a lengthy and thorough underwriting review that included an extensive background check on the company. We spent months in negotiations and ultimately developed a contract that gives the company the flexibility and incentives it needs to be successful while also providing Wisconsin taxpayers with a high level of certainty that their investment will be protected.

Most important, all incentives awarded to Foxconn are ‘pay as you grow’. Foxconn must create jobs and invest capital in Wisconsin before it’s eligible for any credits, and the company can only earn the maximum amount of tax benefits after it has created and maintained 13,000 jobs and invested $9bn.

Q: Is Wisconsin prepared for the potential social and environmental impact of Foxconn’s new facility? 

A: Without a doubt, we are ready for Foxconn. In the past seven years, we have significantly improved our business climate and invested in numerous workforce development initiatives to prepare us for this transformational opportunity. We also increasing the labour pool by removing barriers to work, through efforts such as reforming our welfare system and helping those with disabilities enter the workforce. Our goal is to make sure that every Wisconsin adult who wants a job can get a job, whether it’s at Foxconn or any of the thousands of businesses statewide.

In addition, we are proactively working on talent attraction efforts beyond Wisconsin’s borders, with a new marketing campaign that focuses on attracting millennials from Chicago and other Midwest cities, alumni of Wisconsin universities who now live out of state, and veterans transitioning to civilian life.

Both the state of Wisconsin and Foxconn are committed to ensuring that this project is developed with minimal impact on the environment. All existing state and federal air, water quality, solid and hazardous waste standards must be met, and any impact on wetlands must be properly mitigated. The impact on Lake Michigan will also be minimal. Over the past 20 years, water purchases from Lake Michigan have decreased by 47% and resulted in the loss of 6,000 jobs. Mount Pleasant’s proposed withdrawal is for seven million gallons per day, which represents only 0.07% of the total annual withdrawal from Lake Michigan by all states.

Q: How is Wisconsin preparing for the long-term threat of ever-increasing automation in manufacturing?

A: In the past four years, we have invested more than $200m in state funding for programmes that support workforce development, and we’ve budgeted another $148m for those programmes over the next two years. We are investing in apprenticeship programmes, workforce training grants, fabrication laboratories at high schools and many other initiatives, to give the current and future workforce the skills they need to succeed.

This article is sourced from fDi Magazine
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