Facing the crisis calmly and enhancing confidence in the industry

[China Epoxy Network (China Epoxy Industry Online)December 2, 2008: The global financial crisis triggered by the subprime mortgage crisis in the United States is becoming more and more intense, and its impact is so fierce and spreading.
, Is rare since the great crisis of the 1930s.
As a result, the world economy has been dragged into a recession, and China, as an important member of the global economic system, cannot stand alone.
The negative impact of this crisis on my country's petroleum and chemical industries has already appeared.
How to treat this crisis with a scientific attitude, how to deal with this crisis with effective measures, how to increase confidence in the development of the industry and turn the crisis into an opportunity is our top priority.
According to experts from the China Epoxy Industry Association ( the global financial crisis has continued to deepen and spread since September, and the impact on the domestic real economy has begun to appear.
The economic operation of the petroleum and chemical industries has seen some new developments.
Circumstances, new issues.
A calm analysis of the problems that have occurred since September is due to multiple reasons: First, the global financial crisis has accelerated its spread to the real economy, the international market demand has fallen rapidly, exports have been severely blocked, and the international economic environment for industry development has deteriorated.
Second, the domestic market demand has weakened.
Industries such as construction, light industry, textiles, automobiles, home appliances, footwear, toys, plastics processing and other industries that are highly dependent on chemical supporting facilities have encountered difficulties.
The stock market and housing market have also entered a downturn.
The demand has slowed down significantly.
The third is that we lack mental preparation for the magnitude and extent of the crisis.
When the storm hits, I feel a little overwhelmed and cause psychological panic.
Many irrational situations will inevitably occur.
Losing confidence in the face of a crisis is more terrifying than the crisis itself.
The price of a product plummeted by 50% overnight, which is unbelievable to those engaged in the industrial economy, and violates the laws of normal economic operation.
Therefore, psychological factors and confidence issues are at work in the emergence of this strange phenomenon.
If there is a lack of calm and rational thinking about the crisis, it will inevitably affect people's psychological expectations and confidence in future economic development, and many irrational situations will occur.

    The current economic operation problems of the petroleum and chemical industries are mainly manifested in the following aspects: First, the industry's growth rate has slowed down significantly.
The output value and output growth rate slowed down in September, and the total output value of the whole industry dropped 9.
8% from the previous month, which was the lowest growth rate this year.
Among the 69 types of petrochemical products to be tracked, the output of 39 types decreased year-on-year in September, accounting for 56.
5%, an increase of 16 types from the previous month.
Among them, ethylene dropped by 8%, sulfuric acid dropped by 12.
2%, caustic soda dropped by 6.
2%, and calcium carbide dropped by 14.
3%.
The output of chemical fertilizers and pesticides also experienced negative growth for the first time.
The output of chemical fertilizers fell by 1.
5% year-on-year, of which phosphate fertilizers fell by 16.
5% and ammonium phosphate fell by 22.
7%; the output of pesticides fell slightly by 0.
8% year-on-year, of which herbicides fell by 18.
6%.
Second, the prices of most products have plummeted.
According to experts from the China Epoxy Resin Industry Association ( among the 168 petrochemical products that the Petrochemical Association focuses on tracking, 106 types of petrochemical products have fallen in price from the previous month, accounting for 63.
1%.
Sulfuric acid plummeted from 1980 yuan/ton in September to 400 yuan/ton in early October, a drop of 80%; sulfur fell from more than 6000 yuan/ton in the first half of the year to less than 1,500 yuan/ton in October; methanol from the first half of the year Of 4170 yuan/ton fell to 2,000 yuan/ton in October.
At present, the prices of chemical fertilizers, pesticides, dyes, and coatings, from rubber and plastics to chemical fiber monomers, and from inorganic raw materials to organic raw materials have generally fallen sharply.
The third is that the business is facing difficulties.
First, sales are blocked and products are overstocked.
Especially large-scale key enterprises have a serious backlog, such as Hubei Yihua Group's urea inventory of 253,000 tons, phosphate fertilizer inventory of 106,000 tons, and soda ash inventory of 41,000 tons; Yuntian Chemical's chemical fertilizer inventory is as high as 1 million tons; Guizhou Kailin Group's phosphate fertilizer inventory is 220,000 tons; Wengfu Group's chemical fertilizer inventory is 250,000 tons.
Secondly, when raw materials are purchased at high prices, the prices of current products have plummeted again, which is a serious pressure on funds.
For example, sulfur was purchased at more than US$700/ton in the first half of the year, and it fell to US$55/ton at the end of October.
Phosphate fertilizer companies only had sulfur stocks of 1.
5 million tons and lost 6.
6 billion yuan.

    Secondly, liquidity is tight, and companies are forced to suspend production.
According to experts from China Epoxy Resin Industry Association ( according to incomplete statistics, the operating rate of the chlor-alkali industry has dropped by 30%.
Tianjin Chemical Plant, one of the largest chlor-alkali plants in China, has stopped production by one third; Enterprises stop production by 30%; nitrogen fertilizer companies stop production by more than 30%; phosphate fertilizer companies have an operating rate of less than 30%; paint and dye companies have stopped production at about 1/5; and the national calcium carbide operating rate is only 30%.
Fourth, the growth rate of exports declined rapidly.
In the first three quarters, the import and export trade volume of the whole industry increased by 46.
9% year-on-year, of which imports increased by 51.
4% and exports increased by 37.
2%.
However, since August, the export trade volume has declined month by month, with a decrease of 9.
6% in August compared with July, and a 2.
4% decrease in September compared with August.
Among them, the export of chemical fertilizers fell sharply, with a year-on-year decrease of 69.
3% in September and a year-on-year decrease of 17.
5% in export trade volume.
According to experts from the China Epoxy Industry Association ( according to the data released by the National Bureau of Statistics in early November, the national entrepreneur confidence index in the third quarter dropped by 11 points and 19.
2 points compared with the second quarter and the same period last year.
.
Therefore, I agree with James Morris, the Nobel Prize winner in economics, who recently said at the Beijing Forum: "The essence of an economic crisis is a crisis of confidence.
" Economic development cannot do without the support of confidence.
A positive attitude and firm confidence are important forces for overcoming difficulties.
Facing the current complex and volatile economic situation, we must be full of confidence.
If there is confidence, there is courage, and if there is confidence, there is power.
Especially in this special period, we must keep in mind Premier Wen Jiabao’s famous saying: "Confidence is more than gold.
Important.
"Our confidence is not out of thin air, but is based on basic judgments about national conditions and the development trend of the industry.
A careful analysis of the current performance and development prospects of China's petroleum and chemical industries shows that the impact of the crisis on my country is limited and controllable, and excessive worry is unnecessary.

    Experts from China Epoxy Industry Association ( said that sound economic operation is a solid foundation for building confidence.
In the first three quarters of this year, the gross domestic product increased by 9.
9% year-on-year, the added value of industrial enterprises above designated size increased by 15.
2% year-on-year, and the sales rate of industrial products was 97.
8%.
The profits of industrial enterprises above designated size increased by 19.
4% year-on-year.
Among the five industries with the most profits We account for two: oil and gas extraction industry, chemical raw material and chemical product manufacturing.
Fixed asset investment increased by 27% year-on-year, total retail sales of consumer goods increased by 22% year-on-year, and consumer prices dropped by 0.
9 percentage points from the first half of the year.
The total value of imports and exports increased by 25.
2% year-on-year, and the actual use of foreign capital from January to October increased by 35.
06% year-on-year.
From the perspective of the petroleum and chemical industries, in the first three quarters of this year, various economic indicators were better than those of other industrial sectors, and economic operations remained basically stable.
The industry's total output value increased by 32% year-on-year, sales revenue increased by 31.
5% year-on-year, profit increased by 3.
4% year-on-year, fixed asset investment increased by 35.
9% year-on-year, and import and export trade volume increased by 46.
9% year-on-year.
Among them, in September, the number of production enterprises above designated size in the industry increased by 8.
8% year-on-year; the total industrial output value achieved a year-on-year growth of 25.
1%; the production-sales ratio was 99%; and the export delivery value increased by 20.
2% year-on-year.
These conditions all show that the economic operation of the national economy and petrochemical industry is stable, the fundamentals are sound, and the foundation is solid.
Our current attitude is neither blindly optimistic due to good fundamentals, nor lose confidence due to the impact of the crisis.
We must make concerted efforts to solve new situations and new problems in the economic operation of the industry, and take practical actions to build everyone's confidence.
At the Plastic Expo in Yuyao, our entrepreneurs faced the crisis of "severe winter" and put forward the slogan of "Hold together for warmth and overcome difficulties together".
At present, in response to some outstanding issues in the development of the industry, including emergency measures for the fertilizer industry, accelerating the reform process of refined oil marketization, resuming export tax rebates for chemical products, and paying great attention to the safety of the chemical industry, specific recommendations have been made to the central government.
Related policies have been introduced successively.

    In the next step, a series of special reports will be submitted to the government decision-making departments in response to the problems of key industries and key enterprises.
Second, flexible and prudent macro-control measures are a powerful driving force for confidence.
Recently, in response to new changes in the domestic and international economic situation, the central government has seen things happen early and acted quickly, and timely adopted a series of measures aimed at promoting stable and rapid economic development, including raising the export tax rebate rate for some products and lowering the benchmark RMB deposit and loan interest rate of financial institutions.
, Increasing the minimum grain purchase price and subsidies for grain farmers, etc.
These measures have begun to show results.
According to experts from the China Epoxy Industry Association ( the executive meeting of the State Council on November 9 decided to implement a proactive fiscal policy and a moderately loose monetary policy, and introduced 10 important measures to further expand domestic demand and win It received unanimous praise from both international and domestic.
The decisive adjustments and strong measures at the policy level have sent a strong signal of "preserving growth" and once again boosted people's confidence.
Our task now is to implement the decisions of the central authorities in the specific work of industry development.
How much can we cut and eat this 4 trillion "big cake"? How to seize this round of opportunities and turn "danger" into "opportunity" to speed up development? Judging from the current situation, all localities and industries have responded very quickly, which truly reflects the need for quick action, heavy action, accurate measures and practical work.
It is believed that with the implementation of national control policies and the launch of large-scale investment projects, domestic demand will rapidly expand, and the impact of the economic crisis on China will gradually fade and eliminate.
Third, my country's huge development space is a strong guarantee for lasting confidence.
First, in terms of China’s strategic goals, it is necessary to comprehensively build a higher-level well-off society that benefits the people of all ethnic groups across the country.
The 1.
3 billion people's consumption needs to continuously improve the quality of life will provide a strong impetus for the development of China’s economy for a long period of time in the future.
Power and huge market.
This is unique in the world and has great potential for economic development.

    From the perspective of our time, the 17th National Congress of the Communist Party of China has made it clear that the first 20 years of this century are an important period of strategic opportunity for China's economic development.
This means that there must be a development rate of 7-8% every year.
As long as the policy is right, scientific development will not be a problem.
The 20-year period of strategic opportunities is the boom cycle of the petroleum and chemical industries, and as China's overall strength increases, it can extend the period of opportunity and continue to create new opportunities.
Judging from the current stage of development, China is in the process of industrialization and urbanization.
There is huge space in the fields of transportation and housing, and there are many rigid demands.
Structural adjustments, industrial upgrades, and product upgrades all require a large amount of investment.
Residents, especially farmers, have many unmet needs in terms of consumption.
Whether it is investment or consumption, the Chinese market with a population of 1.
3 billion has a huge market.
Expansion space.
Fourth, from the perspective of the development status of our industry, in the past 30 years of reform and opening up, the industry and enterprises have accumulated a solid material foundation and have been significantly strengthened.
Abundant funds, a vast market, and relatively cheap labor are our advantages.
According to experts from the China Epoxy Industry Association ( no matter how difficult the external environment is and how severe the internal challenges are, as long as we strengthen our confidence and take effective measures, we will surely be able to overcome difficulties and turn crises into opportunities.
China has survived all the difficult and dangerous things this year, and we can also overcome the impact of the financial crisis.
I am very confident about this.
The urgent task at the moment is to clarify the focus of industry development and identify breakthroughs in accordance with the 10 central measures.
Which industries are highly dependent on foreign countries and need to be developed; which industries are weak and need to be strengthened; which industries need to expand investment; which enterprises need technological transformation; Which industries need to be integrated, etc.
, must be well known.
The global financial crisis is a serious challenge, and its impact must not be underestimated.
More importantly, we can turn the challenge into an opportunity to adjust the economic structure, improve the level of development, and deepen reform and opening up, thus creating a new situation for the sound and rapid development of China's petroleum and chemical industries.

(This station reporter) 

Ben Wang 2007 enable the "Chinese epoxy net" new name retains "China Epoxy Resin Industry online" name
English name: E- .