An aluminium mould-making factory, with a total investment of US$23.19 million, is under construction in the Shenzhen Special Economic Zone (SEZ). The project is scheduled to go on stream in July next year. The biggest joint venture of the China National Nonferrous Metals Industrial Corp., the factory is financed by the Shenzhen Joint Corp. and three other companies under the China National Nonferrous Metals Industrial Corp. and their foreign partners, Alcan of Canada and Light Metals Co. of Japan (NLM).

The establishment of the Shenzhen Joint Corp. in January 1984 enabled Shenzhen to have its own nonferrous metals industry. Combining industry with trade and banking, and foreign trade with the import of advanced technology, the total business turnover of this joint corporation has been US$223.3 million and I billion yuan since it started operation in 1984. The joint corporation now has 11 subsidiaries built exclusively with foreign capital, eight joint ventures with foreign businesses and six ventures with inland companies.

Reputation and efficiency

Situ Huai, president of the corporation, said, "We have not built our corporation into a bureaucratic organization with endless numbers of administrative departments. From the beginning, it has always been an economic entity. In running a business in the SEZ, we should discard the inefficient work style and personnel system which is typical of the interior." The three watchwords for his corporation are service, reputation and efficiency.

The Import and Export Trading Co. under the joint corporation has expanded its business by not forgetting these watchwords. The company insists that letters from clients should be answered without delay, and certainly within a week. Same day responses are required for all cables and telexes, except if they require discussion in which case an answer is guaranteed within three days.

Liu Pei, general manager of the Import and Export Trading Co., said that last year his company imported a production line for an enterprise in Guiyang, Guizhou Province. The whole process-from making inquiries about the price, through negotiating, signing the contract, importing and installation to going into operation-took only 58 days.

There are many companies in China handling nonferrous metals imports and exports. Sometimes domestic clients fail to deliver on the deal. In order not to lose credibility, Shenzhen's trading company sometimes has to buy the product at a high price on the international market so as to fulfil its contracts, although it will not always do so. In general tripartite trade on the international market has become an important source of profit for the company.

The trading company now has 22 people on its payroll, their average age is 30, and 16 of them have a college education. Since it started in November 1984, the company has exported US$60.96 million's worth of goods and imported to the value of US$27.97 million. The company can now write its own letters of credit for its import contracts and can pay on time. Its export business has also been running smoothly.

The Translation and Technical Service Co., the smallest subsidiary of the joint corporation, handles both interpretation and written translation work and finds skilled personnel for foreign companies in China. Everyone in the service company is young.

They tell how once a Japanese commercial firm hired a car from the company and the chauffeur arrived half an hour late. When he found out, the general manager, Zhang Guozheng, went immediately to the Japanese firm and made an apology. He offered the car's services free for one day. The mistake has not been repeated.

The joint corporation is notable for its highly trained staff. The headquarters for the corporation and 11 of its subsidiaries has a work force of 399. President Situ Huai is proud to say there are no sinecures in his corporation. Everybody on the technical and administrative sides can take charge of matters outside their immediate area of responsibility. Some people wear a number of hats simultaneously. For instance, the accountant of the Translation and Technical Service Co. is concurrently in charge of statistical and trade union work and for having visiting cards printed up for client organizations. Liu Guifen, a young woman employee, is responsible for wages, the management of the canteen and the routine duties of the office. In addition, she is also the coordinator of the drivers for her company and client organizations. Miss Liu was previously employed as a driver for a sanatorium in the seaside resort of Beidaihe, Hebei Province. She had little work to do and commensurately small wages. She felt she needed more of a challenge at her age.

Young people in important jobs are everywhere in the joint corporation. Situ Huai says he values ability over qualifications and work record. He believes young people are less conservative and are a force for reform and development. The joint corporation offers them a chance to use their talents and also trains bad habits out of them early on. The company demands of its employees that they abide by the law and discipline; do not seek personal gain but rather consider the interests of the whole. Every day university students, come to apply for work in the corporation. In response. the corporation has set up a personnel training centre.

Business expansion

Apart from the Import and Export Trading Co. which deals in foreign trade, all joint ventures under the joint corporation also handle such business. As a result, foreign trade is a major part of the joint corporation's affairs. A number of international joint ventures and cross-country co-operations signed since the founding of the corporation are now under construction or in the preparation stage.

Vice-president of the corporation Huang Dujing said, "The output value of my area of responsibility industry, was 2 million yuan last year. It is expected that it will equal 10 million yuan this year. If all the industrial projects go into operation next year, the annual output value could then exceed 200 million yuan."

Most of the investment on the Chinese side for the industrial projects in Shenzhen come from enterprises in the interior which also contribute large numbers of technical and managerial personnel. The preferential investment policies in the SEZ attract inland enterprises too. "It is hard to visualize the joint corporation doing so well without the support of the inland enterprises," said Situ Huai.

The Jinzhou Hard Alloy Co. under the joint corporation has a registered capital of 12.57 million yuan. The Zhuzhou Hard Alloy Plant in Hunan Province owns 50 percent of the company; the Silver Charge Co. of Hong Kong owns 25 percent, and the joint corporation, 20 percent. The Jinzhou company's general manager, Wu Zhaoming, 42, said that most of the 40 employees including himself come from the Zhuzhou Hard Alloy Plant. The company has agreed with a counterpart in the Federal Republic of Germany on the import of a sophisticated miniature-drill production line with an annual production capacity of 500,000 pieces. The project is scheduled to go into operation in 1988. Half its products will be exported and 25 percent will be sold domestically replacing imports.

Wu Zhaoming said the biggest difference between Shenzhen and the interior is the absence of state mandatory plans in the SEZ. Therefore the market governs the enterprises here. The first thing he learnt was how to do business.

Upon arriving in Shenzhen, Wu and his colleagues discovered that almost all hard alloy disk cutters used in the electronics industry were Japanese imports. So they set about manufacturing quality disk cutters with the equipment already at their disposal. Although the quality of their products was no worse than the Japanese products and the price was much lower, they had to work very hard to find a market for their disk cutters and win customers' trust. His company now dominates the Shenzhen cutter market and is exporting them to Hong Kong.

People from abroad and Hong Kong have been given the posts of general manager in four of the eight joint ventures under the joint corporation. Hans Ruoff, general manager of the Jinao Mould-Making Co., is a German with Australian citizenship. Mr. Ruoff said that compared with the interior, the environment in Shenzhen is more like the West. He has moved his family to Shenzhen. and is satisfied with the progress of the project. He now has full management authority. In March this year. he dismissed a technician from Hong Kong and replaced him with a British.

Situ Huai said his joint corporation plans to set up a whole series of joint ventures. Next year three rare-earth processing projects will be built and he is optimistic about other joint ventures now under negotiation. He will spare no effort to build his joint corporation into an international conglomerate. His aim is for the corporation to be a major world corporation before Hong Kong returns to the motherland in 1997.