Chapter 1116: Chapter 1072: The Direction of Reform Chapter 1116: Chapter 1072: The Direction of Reform “`
Nie Zhenbang’s words excited the leaders of the Red Textile Factory, as they exchanged glances, each saw a spark of excitent in the others’ eyes. This ti, it seed the factory’s system reform and transformation efforts might have hope. Could it still be far off?
Seeing everyone fall silent, Nie Zhenbang smiled inwardly. He had expected this silence; present were provincial leaders, responsible leaders, including those from Hongcheng City, along with several factory leaders from the Red Textile Factory. There were many people. At this mont, it was natural for the leaders not to speak up first.
Nobody there was a greenhorn. To speak rashly and then possibly say sothing incorrect would be like slapping one’s own face, wouldn’t it?
Such behavior was normal; generally, the more important the leader and the higher the position, the more likely they were to speak last.
After pondering for a mont, Nie Zhenbang smiled and said, “Old Song, as the Party Secretary and Director of the Red Textile Factory, I believe you’re the most familiar with the affairs of the factory. As a person involved, your opinion holds great weight, and it represents the voice from the grassroots level. Tell us, currently, what are the thoughts at the Red Textile Factory?”
Nie Zhenbang had deftly appointed Song Zhongguo to speak. Song was not the lowest-ranked person there; he was a leader of a provincial enterprise, holding the rank of a vice-departntal level. Song Zhongguo’s rank was indeed formal, at vice-departntal level.
Among those present, of course, there were those with lower positions than him, such as the several deputy directors of the Red Textile Factory, but in a setting like this, those people had no right to speak. For Song Zhongguo to represent them was most appropriate.
Hearing Nie Zhenbang’s words, Song Zhongguo nodded and said, “Secretary Nie has called upon , so I shall throw out a brick to attract jade. Let’s first discuss so thoughts from the Red Textile Factory.”
“Previously, regarding the enterprise system reform of the Red Textile Factory, we’ve held several factory committee etings, and called a few general worker etings to solicit the opinions of all staff mbers. Overall, everyone has deep feelings for the factory, and we lean toward shareholding reform. Every worker would be involved and truly beco part of the company,” Song Zhongguo took his ti and expressed these thoughts.
It’s undeniable that Song Zhongguo is a good leader, but a good leader is not necessarily a competent one. Objectively speaking, the textile industry is in a slump. Products are outdated, which is the fundantal reason why the Red Textile Factory is on the brink of bankruptcy. But it could also indicate a lack of capability in the leadership team.
With these words, Song Zhongguo also had so careful considerations; he pointed out right from the start that this was the opinion of the factory committee and the workers’ etings, not his personal thoughts. This way, even if his words were incorrect and didn’t align with the upper managent’s intent, it wouldn’t be too problematic. The leadership might be uncomfortable, but they wouldn’t bla him.
Following Song Zhongguo’s statents, the Chief of the State-owned Assets Supervision and Administration Commission, Liu Qinghe, knitted his brows and raised his hand, saying, “Regarding the restructuring issue of the Red Textile Factory, we’ve done a lot of work in the past two years, but it has not been finalized, mainly because of the problem with state-owned assets.”
When Liu Qinghe got to this point, he glanced at Song Zhongguo. As the head of the State-owned Assets Supervision and Administration Commission, Liu had nurous dealings with Song Zhongguo, and the Red Textile Factory’s troubles were a major headache for Liu.
Continuing, Liu Qinghe explained, “According to the statistics at the end of last year, the Red Textile Factory’s total assets, including factory land, equipnt, technology, and other assets, were valued at 1.37 billion yuan. Among these, the value of the land of the three factory zones and the family quarters is 1 billion yuan. This can largely be set aside. However, over the years, the Red Textile Factory’s cumulative loans, including comrcial loans and policy loans, have amounted to 1.63 billion yuan. It can be said that the factory is entirely insolvent.”
Upon hearing Liu Qinghe’s words, Nie Zhenbang’s expression turned grave, and he seed incredulous. 1.63 billion. How could such a number of loans have been acquired?
Frowning, Nie Zhenbang said, “That much? How did this situation co about? It’s completely insolvent.”
Nie Zhenbang’s words made the leaders of the Red Textile Factory show an embarrassed look on their faces. On Liu Qinghe’s side, however, he seed very calm, addressing the issue rather than the person.
Looking at Nie Zhenbang, Liu Qinghe said, “Secretary Nie, the dostic textile industry has been sluggish since the 1990s, and specifically for the Red Textile Factory, since 1995. Over the past fifteen years, the total amount of cumulative loans has reached 1.63 billion yuan. Of which, 980 million yuan are policy loans guaranteed by the governnt, and 650 million yuan are comrcial mortgage loans, secured against the land and equipnt of the Red Textile Factory. The earliest comrcial loan was five years ago, totaling 120 million yuan, which is due this year.”
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Hearing Liu Qinghe’s analysis, Nie Zhenbang had more or less understood the situation. It seed like a lot of money was loaned out, but upon calculation, it wasn’t that much. Spread over fifteen years, it averaged just over a billion yuan a year. This included technological upgrades and the introduction of equipnt, as well as the stockpiling of raw materials and products, to na a few areas. Fifteen years later, four to five billion yuan were definitely consud. The remaining 12 billion yuan averaged eight hundred million yuan per year.
The Red Textile Factory, including both retired and active workers, had 12,000 people, which wasn’t a large number. Calculating at 500 yuan per person per month, the monthly payroll was six million yuan, and annually it would be seventy-two million yuan. And this didn’t even include dical and social insurance contributions. In reality, the figure could only be higher.
No wonder Liu Qinghe expressed opposition. If this were the case, then the issue of shareholding reform of the Red Textile Factory needed to be treated with caution indeed. To carry out shareholding reform, the 1.63 billion yuan loan was a hurdle that couldn’t be bypassed.
Moreover, sotis just having enthusiasm wasn’t enough. Take the simplest example. Even if every worker at the Red Textile Factory was willing to contribute funds, considering their financial difficulties, how much savings could they have? Even if they borrowed from relatives and friends, if each person could raise ten thousand yuan, and retirees weren’t included, that would only make up sixty million yuan. This sum of money wouldn’t even be enough for starting operations again. In addition, what should the product direction be? How should sales be handled? These were issues that needed to be considered. After all, it wouldn’t do for products to be stockpiled in the warehouse after starting production. If so, what would be the point of the shareholding reform?
After pondering for a mont, Nie Zhenbang looked up and said, “Do you have any opinions?”
Hearing Nie Zhenbang’s question, Zhou Chuanjia sat up straight. He had listened attentively to everything that had been said earlier. From Liu Qinghe’s perspective, representing the State-owned Assets Supervision and Administration Commission, shareholding reform certainly didn’t seem cost-effective. There were so many loans involved, and the loss of state-owned assets was an issue that couldn’t be ignored.
From his point of view, he preferred to attract investnt capital. On one hand, it could solve the issues faced by workers at the Red Textile Factory, and on the other hand, it could resolve the loan issue.
However, Zhou Chuanjia was well aware that such a thod would inevitably face strong opposition from the staff of the Red Textile Factory. At this mont, it was quite a dilemma for Zhou Chuanjia.
Yet he was clear about Secretary Nie’s character. Trying to please both sides in this situation was sothing Nie Zhenbang disliked the most.
Imdiately, Zhou Chuanjia began to speak, “Secretary Nie, overall, considering the wishes of the workers, I still lean towards shareholding reform.”
Continuing on, Zhou Chuanjia said, “Regarding the policy-oriented loans, I don’t think they pose too great a problem. On this matter, the provincial governnt can act as guarantor and delay repaynts, as for comrcial mortgage loans. Currently, the most crucial matter is repaying the one hundred and twenty million yuan due this year. That’s an amount the Red Textile Factory must repay. Adding that to the costs of resuming operations and ensuring the livelihood of workers, this investnt will need at least three hundred million yuan in funds. How we obtain this sum is a matter worthy of our attention.”
As Zhou Chuanjia’s words concluded, Nie Zhenbang’s gaze suddenly turned toward Yao Dingguo sitting beside him and said with a smile, “Comrade Dingguo, although the Red Textile Factory is a provincial enterprise, it is, after all, within the jurisdiction of Hongcheng. Matters related to household registration and municipal governance still fall under the city’s administration. Do you have any recomndations?”
After Wen Baogui’s departure, Yao Dingguo, as Wen’s relative by marriage, beca an isolated figure within the Hongjiang Provincial Committee team, and cooperation with Nie Zhenbang beca an unavoidable choice for Yao Dingguo.
In fact, over the past half year, Yao Dingguo had indeed been doing so. Listening to Nie Zhenbang’s words, Yao Dingguo nodded slightly and said, “Secretary Nie, I think we can form a working group comprising the Provincial Committee, provincial governnt, State-owned Assets Supervision and Administration Commission, Finance Departnt, Audit Office, and other relevant units, to reassess and audit the assets of Red Textile Factory. Following that, we can combine the assessed assets with a projected investnt of three hundred million yuan. For instance, if the assets are valuated at 1.4 billion yuan, then adding them together would be 1.7 billion yuan, which could be converted into 1.7 billion shares. Then, based on voluntary principles, the stocks could be offered to the workers of the Red Textile Factory. We can set a certain shareholding ratio for the State-owned Assets Supervision and Administration Commission. If there’s a shortfall, we could consider attracting investors. In doing so, I believe repaying the loans won’t be an issue. Furthermore, we could establish a new board of directors and managent team. I think this approach might be better.”
As Yao Dingguo finished speaking, Song Zhongguo and others changed their facial expressions. Song Zhongguo seed sowhat troubled as he said, “Secretary Nie, if we proceed this way, I fear we might encounter obstacles.”
Song Zhongguo’s words imdiately caused Nie Zhenbang to frown. He was very satisfied with Yao Dingguo’s suggestion, which on the one hand fully considered the feelings of the workers at the Red Textile Factory, and on the other hand, could attract investors to better promote the developnt of the enterprise. Otherwise, relying on the current team would be just a case of old wine in new bottles.
Subsequently, his expression darkened as he said, “Old Song, in your opinion, how should the reform be carried out to be appropriate?”
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