Thirty Years of Turbulence - Chinese Enterprises

作者：admin  点击次数：9  发布时间：2025-07-27

Shougang, which became China's first reform pilot enterprise three years ago, was one of the earliest state-owned enterprises to be impacted. In the past two years, Shougang's net profit has increased by an average of 45.32% per year, and its paid profits and taxes have increased by an average of 27.91% per year, showing signs of prosperity. However, trouble soon arose. In April, eight units including the National Economic Commission, Ministry of Finance, General Administration of Materials, and Ministry of Metallurgy jointly issued a notice to implement strict production restrictions on steel nationwide. Shougang's production reduction task is 360000 tons, accounting for 9% of the total steel production in the previous year. The factory director Zhou Guanwu had to order the shutdown of the recently put into operation No. 2 blast furnace.

There is more to holding one's breath than that. At the same time as the production restriction task was issued, Zhang Peng, the deputy mayor of Beijing, rushed to Shougang and brought instructions from the city: due to the tight government finances, as the "leading soldier" of Beijing's industrial enterprises, Shougang must ensure that its profit contribution this year reaches 270 million yuan, an increase of 9.3% over the previous year. Zhou Guanwu held a piece of paper and a pen to calculate for the mayor: "Shake out all the assets of Shougang, and the maximum profit of 265 million yuan will be fully paid in. The company will not retain any profit, and the welfare of employees will soar to the sky." However, Zhang Peng also candidly said, "Life in the city is not going well this year, so we need to put more pressure on you