Kinsley Avenue in Providence is a long way from Budapest, Hungary. But Roger Vertes, vice president at Die Tech Industries, Ltd. anticipates that distance shortening significantly in the coming years. And when it does, Vertes and Die Tech Industries will be ready.
Die Tech Industries manufactures hot chamber die-casting machines, which cost about $80,000 a piece. Utilizing a wide range of dies, the machines craft metal and zinc products, creating such things as belt buckles, eyeglass frames and auto parts. The Die Tech machines are now sold throughout the United States and abroad. But Vertes is always searching for new sales opportunities. Vertes is always trying to pinpoint just where a new market may open.
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Early this summer, that search for new markets took Vertes – and representatives of four other Rhode Island-based businesses – on a state-sponsored trade mission to Central Europe.
For Vertes, the week-long trip was his first visit to that particular corner of the world. It was also, he said, well worth his time.
What Vertes learned in Budapest, Poland and in Warsaw, Poland was that while companies in these countries may not be in the market for a die-casting machine today, they may very well be soon.
“These are countries relatively fresh out of communism,” Vertes said. “The opportunity for what we do is coming. The economies there are strengthening. The banks there are getting things under control.”
Vertes knows that such a trade mission is more of a long-term investment than a quick-hit. It is a chance to establish groundwork. He said that after a series of interviews, Die Tech Industries might have found a representative to work in the area – someone who knows that area, and can learn his product.
”I may not see results for a year – or five years,” Vertes said. “But it’s important to gain a foothold.”
The Rhode Island Economic Development Corporation, with help from the state Human Resource Investment Council, arranged the trade mission – one of several the EDC has sponsored in recent years.
This mission, however, differed from those in the past, according to Maureen Mezei, international trade director at the Rhode Island Economic Development Corporation.
“These companies came to us and said that they were interested in these markets,” said Mezei. “Their objectives were to really learn about these emerging markets.”
Participating companies were brought together with the proper European economic development officials and were assisted in scheduling interviews. The EDC worked closely with the United States Foreign Commercial Service in scheduling appointments.
The companies that took part in the trade mission paid for their own travel expenses and a participation fee of $2,000. In addition to Die Tech Industries, the following companies took part: Advanced Interconnections Corp.; Coto Technology; Lawson-Hemphill, Inc.; and Taco, Inc.
Hungary leading the way
Trade with Hungary and Poland is not new to Rhode Island. Hungary, for example, is Rhode Island’s 32nd largest trading partner, with a total of $3,296,046 in Rhode Island exports to Hungary in 1999. Rhode Island trade with Hungary increased by 106 percent from 1997 to 1998, and by 215 percent from 1998 to 1999. Poland is Rhode Island’s 42nd largest trading partner, with $2,068,071 in export sales in 1999, a slight decrease of 11 percent from the 1998 level.
Over the past 10 years, according to information compiled by the EDC, Hungary has developed a leading economy in Central Europe. It has attracted one of the highest per capita foreign direct investment levels in the world, with the United States being the largest single investor. Hungary is a full NATO member, and is soon to be a full European Union member. More than 80 percent of Hungary’s trade is carried out with Organization for Economic Cooperation and Development countries.
The United States represents the fifth most important trading partner for Hungary. In recent years, exports of information technology, consumer goods, telecommunications, medical equipment and healthcare technology have been in high demand.
Poland has dramatically transformed its economy since the collapse of communism in 1989. A growing private sector dominates the economy, though state-run enterprises maintain a significant role in heavy industry, utilities and financial institutions. Poland’s unemployment rate and inflation rate have been steadily declining during the past decade.
The Polish economy continues to grow. A growing middle class and developing distribution networks are turning Poland into an attractive market for small and medium American exporters. Many European firms have recognized Poland’s potential and are expanding operations there.
”Hungary is a little further along in terms of its economic liberalization than Poland, but Poland is much bigger,” said Mezei.
That these countries offer burgeoning economies is one reason trade opportunities between them and American businesses make sense — a general sense of goodwill toward the United States is another.
”Americans are viewed in an extremely positive light in these countries,” Mezei said. “That is an advantage.”
Like Vertes at Die Tech Industries, Tony Saccoccia, came away from the trade mission with a real sense that opportunity awaits.
Saccoccia is the European sales manager at Advanced Interconnections Corp., in West Warwick. The company designs and manufactures socket adapter components for printed current boards.
Twenty to 25 percent of its business is through exports. In Central Europe, Saccoccia saw companies like Hewlett Packard and Motorola having already established a presence, he said.
”I was surprised by the high level of high tech manufacturing going on in Hungary,” he said. “As things continue to develop, they will have a need for our products.”
