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The reform and development of Chongyang County, Changhua Industrial Co., Ltd 09-08-13

  Rise from the Ashes

  Rotary kiln cement production line started production!

  “We have been expecting this day for a long time!” Over the past few days, In Chongyang County, Changhua Industrial Co., Ltd., the cadres and workers were very happy and spread the news to each other.

  This is an unusual project. It has been a year and two months since its start to the time it was put to production. The project has a total investment of more than 200 million yuan. The local people call the company an “indigenous” national industry. The Changhua company’s re-emergence will greatly reverse the situation that the county has been weak in industry for many years, while the Changhua Company itself has gone through numerous problems and difficulties.

  Getting Into Impasse

  The Changhua Company, formerly known Chongyang County Cement Factory, was built in 1978. In 1995, the annual amount of output by its three production lines was 300,000 tons and the pre-tax profit was over 400 million yuan. Under the Planned Command Economy, the factory achieved brilliant achievements and was one of the largest tax payers in Chongyang County. 

  However, the factory’s business became much less because of the development of Market Economy and the establishment of many surrounding cement factories. What’s worse, the lag of reform led the factory to worse business condition and getting into plight. At the end of the last century, the factory’s debt reached more than 90 million yuan and number of its staff was more than 1,700.

  Actually, at that time, the factory was caught in the strange circle that it borrowed money to pay tax to the government, while the government gave money to help the factory.

  In 2000, the enterprise has been in a semi-shutdown state. To save it, the people thought of many methods. However, since the dept was too large and the people’s burden was too heavy, the methods were not very successful. At the end of the following year, the enterprise was almost paralyzed.

  If we did not reform, the factory was doomed to perish.

  There were two options: First was full buyout and the second was to rent. The former can temporarily keep the workers’ interests, while the latter was that the boss can earn a lot of money, and go while leaving behind a pile of rotten equipment.

  Anyway, the people had premonition that if they just let the condition continue, the factory would definitely perish. Thinking that the factory they had stayed in for decades was going to break down, many workers shed sad tears.

  Change brought vitality

  In February 2002, the County Communist Party Committee and County Government decided to implement restructuring in the factory.

  The leaders of the factory including Long Tianhua, Chen Lianggang, Liu Zhongliang, who had fought for many years for the factory said:“We are not willing to see the collapse of the factory ”

  They soon submitted to the Government a detailed report, analyzed of the condition of the factory, and proposed a “three-step" reform and restructuring program and future development goals.

  The first step: in the first three years, it will pay back part of the dept make the debt fall from more than 90 million yuan to 60 million yuan, cut its staff from 1,735 people to 580 people, and improve the production from 230,000 tons to 300,000 tons.

  The second step: it will totally pay back the debt, cut the workers from 580 people to 360 people, and increase the per capita labor productivity from 145 tons to 1,000 tons.

  The third step: it will launch a cement production line of new dry method rotational kiln, increase its annual output to 1-1.2 million tons, improve its output value to 350 million yuan, and increase the pre-tax profit to over 20 million yuan. 

  Unexpectedly, a sudden storm came. Some workers can’s accept the fact that they were once the factory’s “boss” and had become the “wage earners” of the bosses, while some workers wanted to get extra compensation and took the opportunity to make trouble. During the difficult period, the government of the province, the city and the county gave full recognition and firm support to the reform and restructuring of the factory. 

  During that period, Long Tianhua and the other leaders of the factory were under unprecedented pressure. The creditors came constantly, the trouble-makers didn’t let it go, the corporation’s reputation was shaking, and the market was shrinking …

  We must hold on! The leaders was patiently persuading the workers, and at the same time, trying their best to maintain the ordinary production. Lacking of funding, they encouraged the shareholders to borrow from whoever they know, while they themselves went to their relatives and friends to borrow money. Some took out the money for the wedding of their children, and some sold their family properties. They chipped in to protect the operation of the enterprise.

  The shareholders were doing everything wholeheartedly for the company. The workers were moved by what they saw and chip in. Soon the company collected more than 10 million of working capital.

  To win the trust of customers, they take the lead in the implementation of quality underwriting to the users, and in being responsible for the quality for life-long time, which stabilized the user market.

  Hard work pays painstaking person. All the original development objectives of reform and restructuring have been achieved step by step and in advance.

  Today, the workers are all saying: “If the company has not experienced the impasse, it wouldn’t have made the achievements”

  Bravely Cultivating the New Road

  Restructuring was successful and its market was steady. However, the leaders of Changhua Company were not satisfied with the initial victory.

  The traditional shaft kiln cement production line made a lot of dust, caused serious pollution, and consumed high energy. If the enterprise didn’t change its production line, it would get into anther impasse. They were confronted with the issue of launching a project of the international advanced rotational kiln cement production line of new dry method.

  In order to make the project launch early, the County Communist Party Committee and County Government did all they could to attract everything possible investment and carried  out a series of preferential policies. County Communist Party Committee Secretary Cheng Qunlin and the County Magistrate Chen Wubin came to the company for many times, helped to solve the difficulties, gave full support, and required the Changhua Company that it must set an example for the Chongyang industrial development.

  Whether the condition favors or not, the company had to try.

  The leaders and staff of Changhua Company were ready to ignore the personal loss, paddled their own canoe, collected funding, employed talented people, and solved the difficulties. On June 23, 2009, the rotary kiln cement production line of new dry method was put into trial production.

  After the project was launched, the annual output was 1.2 million tons, 5 times of the original. The sales income was 350 million yuan and the tax was over 20 million yuan. It saved 10,400 tons of standard coal that year, and led the related industries to add output value of more than 100 million yuan.

  In order to implement the national energy saving policy, the company would close the three lag shaft kiln cement production lines.  

  Long Tianhua, the chairman and general manager, said: “Although this causes an annual lose of 5 million to the company, this show the company’s firm determination in implementing the Scientific Outlook on Development.”

  The calculation shows that the tax that the company has paid in the six years since its restructuring is more than half of the total tax that it paid in the 24 years since its establishment. The workers’ annual wages timed twice, an increased of 20%. At present, the company has paid for 5 kinds of insurance for all the staff, the company’s culture is rich, and the cohesiveness is greatly enhanced."

  Liao Jianming, the member of the County Communist Party Committee and the deputy County Magistrate, said that the operation of the company’s new cement production line was an important symbol of Chongyang industry’s good prospect, the industrial power consumption in the first half of this year increased by 6.9%, and Chongyang industry will be very impressive. (Reported by Liu Wenjing and Zhu Zhe  Xianning Daily)

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