On January 22, ChemChina and Sinochem jointly held the 2021 work conference in Beijing. ChemChina President Yang Xingqiang and Sinochem President Yang Hua respectively made a work report which reviewed performance in 2020 and outlined targets of the new year. Ning Gaoning, Chairman of ChemChina and Sinochem, made a concluding speech.
Yang Xingqiang pointed out in his work report that since the outbreak of the coronavirus epidemic in early 2020, all employees of ChemChina have taken responsibility and devoted themselves to the battle against the disease, and remarkable results have been achieved. The Group has established an epidemic prevention and control system covering enterprises at all levels at home and abroad, and refined the measures in accordance with the requirements of the governments of various countries. Giving play to its technical advantages, the Group turned to production of anti-epidemic materials such as disinfection solution, isolation clothing, protective masks, high-performance melt-blown material production line and supporting equipment.
What’s more, domestic and overseas subsidiaries joined hands to overcome difficulties. At the time when China was facing the greatest pressure in fighting the epidemic, overseas enterprises immediately responded and made every possible effort to raise materials for epidemic prevention and transport them to China. After the epidemic swept abroad, the Group and its SBUs allocated various demanded materials to overseas partners.
In 2020, despite the complicated and ever-changing market environment, all employees of ChemChina stepped up to the challenge, seized the opportunity, achieved a good balance between routine epidemic prevention and enterprise development. In the fourth quarter, the Group carried out special actions such as "Sprint in the Fourth Quarter" to seize the opportunity of market recovery and achieve full production and full sales. Finally, all the budget targets for the whole year have been reached.
2021 is a promising year. It is both the opening year of the "Fourteenth Five-Year Plan" and the 100th anniversary of the founding of the Party. The Group will continue to carry out Top Ten Actions, including the HSE Action, Science First, Focus on Growth, Deepen Reform, Optimize Structure, Comprehensively Benchmark, Chinese Strategy for Overseas Companies, Accelerate Digital Transformation, Prevent Financial Risks, and Strengthen the Party Building. The Group will push forward the enterprises to overcome challenges, improve quality and efficiency, focus on solving the existing problems, and realize the high-quality development of ChemChina.
Chairman Ning Gaoning delivered a speech titled "Starting a New Journey Towards a Great Company under the Guidance of Three New Developments." He shared his insights after listening to Chinese President Xi Jinping's remarks when addressing the opening of a study session at the Party School of the CPC Central Committee, which was attended by provincial and ministerial-level officials. Xi spoke of the importance of the new development philosophy, namely, "entering a new stage of development, implementing new development concept, building a new development pattern”. Ning believed the Three New Developments are very consistent with the current situation and reality of Sinochem and ChemChina, and should guide the future work.
First, entering a new stage of development.
Under the coronavirus pandemic, Western capitalism has arguably faced its biggest challenge in more than 300 years which has not been resolved yet. While only China achieved a positive GDP growth of 2.3%, the chaos of the West and the rule of China are in sharp contrast.
The GDP of China now exceeds 100 trillion yuan, and the per capita GDP exceeds 10,000 dollars. In this context, the Chinese market and China's chemical market provide the Group with a good opportunity for development, Ning pointed out.
Recently, ChemChina compiled the History of the 100-Year Development of China's Chemical Industry, which mentioned that China's chemical industry began with sulfuric acid and caustic soda, followed by salt chemical industry, chemical fertilizer and paint. Today, China's chemical industry has reached a new stage where it needs high-quality, high-level and high-standard development. The new stage is also featured with high-value-added products, hi-tech products, international competition, R & D and talents. This is a rare development opportunity for Chinese enterprises.
Ning underlined the development model that relied on scale and overall economic growth has to be changed. “We must be fully aware that all our work should be considered from the perspective of the new stage of development, which should be taken as the starting point for our ideas, concepts and plans for development.” Therefore, the ongoing integration between Sinochem and ChemChina is a historic task and opportunity for future development. It is fortunate to have experienced the creation of a large company consolidation which is able to contribute to the long-term development of the industry, Ning commented. It is believed that the restructuring of Sinochem and ChemChina will initiate a new era in the next decade.
Second, practicing the new development concept.
In the new stage of development, executives should review themselves with new ideas. Under the circumstances of scientific and technological progress and market competition, it is impossible to forge ahead without changes. Without refreshing of mind, executives can't keep up with the development of the situation and the business and will fail to obtain the ability to manage the enterprise well.
In line with the idea President Xi Jinping stressed for innovation, Ning has put forward the new concept of "In Science We Trust", which clarified the company’s guideline of giving priority to science and pursuing innovative development. Green development, which was also required by President Xi, brought out another opportunity. The new idea, further interpreted as HSE (Health, Security and Environment) in chemical industry, could help the company forge new competitive edge if being well handled.
It is a traditional philosophy of the Group to stick to the consistency of corporate strategy and national strategy, and the business of Syngenta, MAP and new materials have driven the Group even closer to the national strategy and China's development. In the future, the segments of agricultural chemistry and new materials are expected to make greater contributions to social development.
Inferring from a symposium with entrepreneurs chaired by President Xi Jinping and attended by Ning last July, the importance of chemical industry is escalating. In addition, Sinochem and ChemChina recently signed a strategic cooperation deal with Jilin Province. As a big agricultural province, Jilin has decided to fully support the development of MAP, which proved the significance of the industry.
Third, building a new development pattern.
The new development philosophy, namely, "entering a new stage of development, implementing new development concept, building a new development pattern”, will be the focus of work.
In terms of layout, the Group is sure to be technologically advanced, international and market-oriented. What’s more, the Group should be equipped with industrial chain, park base, and brand awareness. The industrial park base combined with the industrial chain is going to be the main development modes of the chemical industry. The parks will contain industrial chains featured with high technological value and large scale. At the same time, it is necessary to move toward the consumer end and increase added-value by extending industrial chain, instead of relying on pure intermediate products.
Last year, people of ChemChina and Sinochem worked very hard and achieved sound performance, even exceeding expectations to some extent. In the future, facing a new situation, every business division or business unit may grow to be a big unicorn. After years of integration, adjustment and consolidation, a stable profit base is believed to emerge. In another three to five years, the Group will come into a real healthy operation. However, to make it true, each division, business unit and factory must give full play to their potential and efficiency by conscientious work, Ning said.