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Chinese entrepreneur: "Run faster to develop after crisis"
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15:40, August 10, 2009

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"At present, my firm is most worried about what advantages to tap in order to keep abreast of changes in the wake of the financial crisis rather than the timing when a new round of economic take-off starts," an ace Chinese entrepreneur named Lu Guanqiu said.

Lu recalled three things he has done over the past four decades. First, he said he set up a sizable enterprise from proceedings of inception workshop; second, he cut through "paddy fields" to brave the outside world and encouraged local enterprises to set up corporations overseas and, thirdly, his transnational firm with access of overseas markets flews back into his "fields at home" to repay or "feedback" the farming industry.

Why can a township or village-run enterprise develops so fast and what has it been hinging on? It is owed, he said, firstly to a rare, unprecedented opportunity provided by the policies of the Communist Party concerning the reform and opening-up for enterprises in the country and secondly to a dauntless, enterprising spirit, or the spirit of "overstepping oneself and never feeling satisfactory".

"My enterprise has experienced the unprecedented crisis with a fewer business orders from overseas, reduced "net value of assets" and foreign exchanges losses incurred in monetary exchange from the conversion of any non-Renminbi (RMB) monetary assets, Lu acknowledged.

Some factories of relatively higher international standards under the Wanxiang Group with Lu Guanqiu as its board chairman had once two weekend days off or even three days off for their workers and staff. But in just half a year, these factories increased their income and profits by 3 percent and 66 percent year-on-year and quite a few of them started to work extra shifts again.

Why does Lu’s factory production resume so fast? It is ascribed to viable, efficient policies of the Chinese government designed to spur domestic demand on one hand and, on the other hand, to the timely adjustments his firm had made three years ago to the direction of the government macro-economic policy, so some of the firm's value-added products are able to make much more profits.

The current financial crisis will come to an end sooner and later, but what they hinge on is precisely to be greater competitiveness in the post-crisis days, Lu noted. Hence, people begin making strategic planning right now for the economic layout a decade later with three objectives:

The First objective is to persevere in merging substantial business with the financial industry. Industry and commerce constitute the foundation and, with a firm, reinforced basis, the entire economic setup will not sway or collapse despite a myriad changes. The development of substantial business, nevertheless, should have the financial sector to back up. With an onslaught of global financial crisis, people now appeal for a return to substantial businesses. Nevertheless, it is owed precisely to the ongoing global financial crisis that China ushers in or greets a strategic opportunity for its banking industry to develop ahead of time.

Second is to adhere to "walking out" and "importing (or introducing advanced experience or technologies of big transnational firms) from overseas" and, taking such endeavors as a turning point, China would upgrade its competency and increase its international competitive edge through a great alliance and great circulation of funds.

Third is to go in for the development of new energy resources, which is bound to be a major thriving industry in the years ahead. After a decade of viable accumulations, people have seen more distinctly two distinct industrial production chains. One is the production line of power-generated automobiles that has commenced as of 1999, and the other is the clean solar energy and high-quality energy in overall energy production that starts in the year 2000.

In the new, multi-setup of intensive competitions globally, all human resources, production setups and development modes will have to face new changes. So, all the existing individual enterprises as well as employees should get prepared and adapt themselves to fast changes and new, competitive innovations.

By People’s Daily Online and contributed by Lu Guanqiu, Chairman of the Board of the prestigious Wanxiang Corporation, one of the top 500 companies in China.

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