Larry Pope, chief executive officer of Smithfield Foods, told a sometimes skeptical Senate Agriculture Committee this week that the $4.7 billion acquisition of Smithfield Foods by Chinese company Shuanghui International would mean more jobs, increased pork exports and, ultimately, more opportunities for company growth.
According to Food Safety News, during the hearing, Pope told senators, “It will be the same old Smithfield, only better,” he said, noting that pork producers and industry groups are supportive. “There should be no noticeable impact in how we do business operationally in America…except we plan to do more of it.”
Pope’s view was backed up by the testimony of Matthew Slaughter, an associate dean at the Tuck School of Business who served on the Council of Economic Advisors to President Bush. Slaughter said the investment and the increased trade with China is exactly what the sluggish economic needs, adding that a smooth transaction would signal that the U.S. is ripe for foreign investment.
Food Safety Newsreports that the hearing was extremely divided. Committee chairwoman Debbie Stabenow (D-MI) raised concerns about the Chinese meat company gaining access to valuable pork industry technologies that were heavily supported by taxpayer-funded research and seriously questioned the federal government’s process for reviewing such acquisitions.
Concerns were also voiced during the hearing that the deal could ultimately result in the U.S. importing more food from China in the wake of recent dangerous food scandals. Pope responded that the acquisition will not result in any imports of food into the U.S. from China, and that the company will be under the strict scrutiny of the USDA’s Food Safety and Inspection Service.
Daniel Slane, Commissioner of the U.S.-China Economic and Security Review Commission at the U.S. Chamber of Commerce, said that the fact that Shanghui was effectively controlled by the Chinese government and the transition is partially financed by the Bank of China meant that a potential national security threat may exist.
The New York Times reports that Pope noted that many other companies and industries receive investments from foreign companies. Pope said the transaction would help an industry that has struggled to continue to grow. “Without the opportunity to grow outside the U.S., there is no opportunity for us to grow as an industry,” he said in the New York Times article.
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