1988: Back to the human world for a few years

Chapter 499 A Son-in-Law Like a Wolf (2)

As we all know, polycarbonate and nylon 6 are two of the five major engineering plastics, and their downstream applications are very extensive.

Among them, polycarbonate (PC) is mainly used in three major industries: electronic appliances, automobile industry, and sheet and film; especially electronic appliances, its application ratio in later generations accounts for 44%;

Nylon 6 (PA6) is mainly used in the manufacture of nylon fibers, engineering plastics, and films, especially nylon fibers, which account for as much as 70% of the total applications.

Although polyols are not as well-known, their application range is not inferior to the first two.
The butanol derived from it, especially n-butanol products, are mainly used in real estate-related industries such as coatings and adhesives;

The octanol derived from it is mainly used in related manufacturing fields such as cable wrapping plastics, artificial leather, gloves, and medical gloves.

Among these three new materials, polycarbonate is probably the most familiar and influential one.

In fact, the overcapacity and price plunge of various basic chemical raw materials represented by polycarbonate in 2019 did cause heavy losses to many investors. They even began to hate this raw material that is highly positively correlated with the oil price cycle. Because of this positive correlation, they developed an impression that it has "no technical content" and even subconsciously classified it as ethanol and methanol.

But in fact, it would be great if China's polycarbonate industry could really be produced as easily as ethanol and methanol.

Although polycarbonate was developed and industrialized by Bayer as early as 1958, and my country followed suit to conduct research on it; in fact, the technical barriers of this thing, especially the technical barriers in industrial production and patent barriers, are far from as easy to break through as most people think.

For quite a long time, my country's polycarbonate could only rely heavily on imports, or rely on paying a huge price to invite foreign businessmen to invest and build factories in China in order to increase production capacity and meet my country's demand for polycarbonate.

In fact, it was not until 2016 that the four institutions, namely, Chenguang Research Institute, China Chengda, Shanghai Tianhua Group, and Chengdu Institute of Organic Chemistry of the Chinese Academy of Sciences, jointly completed the engineering development of polycarbonate and established the first 10-ton non-phosgene polycarbonate plant in China with independent intellectual property rights. This forced foreign countries to restrict the transfer of China's polycarbonate technology, which ultimately promoted a huge explosion in China's polycarbonate production capacity.

See the problem?
The difficulty in the development of China's polycarbonate industry is not the basic technology of "ester exchange method". In fact, China caught up with the research progress as early as the late 50s, and in the 70s, it established more than 20 sets of 100-ton/year PC intermittent production equipment in Dalian, Shanghai, Chongqing, Changzhou, Hangzhou and other places.

The real difficulty is:
1. How to bypass the "phosgene-based PC concentration process", a production process that has been developed by foreign companies, patented, and built with strict patent barriers... Since China has already reformed and opened up, and is gradually moving closer to the world economic system, then you must start to abide by the rules of the game.

2. In fact, since the late 70s, due to the rules of the game, there have been some studies on "non-phosgene concentration technology" in China, and some gratifying progress has been made. However, how to transform it into industrial production and improve its technology is a very challenging task.

Although it may be difficult for some people to accept, I can tell you responsibly that during the period from the 50s to the 80s, China's scientific and technological research in various fields, at least the basic and reserve technological research, was far more comprehensive and fruitful than everyone thinks.

It’s just that most of these technologies are just imitation and replication. Therefore, once the reform and opening up began, these things became "patent infringement" in the eyes of European and American companies. Unless huge patent royalties were paid, they were not allowed to circulate in their trade system.

This is true for chemical products, mechanical products, steel products, semiconductor components and accessories, and also for clocks, televisions, and radios.

In fact, this is another very important reason why China's industry encountered great difficulties from the 1980s to the mid-millennium... It's okay if people pretend to be blind for some reasons, but if they start to take it seriously, you will be in so much pain that you will explode in minutes.

In fact, throughout the 1980s, China made tremendous efforts in this regard. On the one hand, it used soft or hard methods to protect its domestic industries. On the other hand, it was actively seeking technological upgrades or circumventing these patent barriers through some roundabout methods... At the very least, it was trying to reduce the payment cost as much as possible.

So after twelve years, there is actually some hope in many areas, and the most well-known Chinese card is probably just a small microcosm of it.

only……

Starting in 1991, everything started to change.

Again, whether it is economy, trade, or even industry, it has never been an independent entity.

........................

"Dad, I know that the headquarters not only has its own scientific research and technology center, but also has been cooperating with Dongying Petroleum University. There are also special projects in the fields of polycarbonate, nylon 6, and polyols."

"Although the non-phosgene concentration process for polycarbonate and the industrial production process for nylon 6 and polyols are not yet mature, we have achieved a breakthrough...especially for polycarbonate. If I'm not mistaken, the headquarters is almost at the stage where small-scale production verification can be carried out, right?"

Yang Mo said respectfully, "If not for this, after the approval of the Solitary Island No. 2 project, you would never have insisted on adding and transferring the bisphenol A and caprolactam projects of the Shikou Refinery in the name of counter-cyclical expansion, making it one of the first batch of peripheral configuration projects of the Solitary Island No. 2 project... Although I haven't read much, I know that bisphenol A and caprolactam are the upstream raw materials of polycarbonate and the most important synthetic raw materials."

To be fair, although the Dongying Command was extremely passive in the local worker-peasant relationship and even became a laughing stock of the entire system; but when it comes to technical resources in this field, it is definitely among the top three in the country, and can even maintain the second place and compete for the first place in the system...Dongying Petroleum University is right next to it, which is an old key university.

Therefore, even though it is only 1991, it is not surprising to have achieved certain substantial research results in the non-phosgene concentration process of polycarbonate, and it is not even a pipe dream to rapidly advance to the level of industrial production within two or three years;

Of course, the prerequisite is that there is a wealthy sponsor like the Command Center who is willing to continue to invest heavily... just like the Shanghai Tianhua Group in 2016.

Does the headquarters have money?

That person must be rich, and his wealth is definitely not even comparable to the later Shanghai Tianhua Group.

Is the command willing to continue to invest heavily?

That was inevitable. As one of the core senior officials of the command, Mu Siyuan's long-standing belief was that no matter what the cost, even if it meant working hard for a few years, he had to first upgrade some of the command's chemical technology capabilities to a level that could keep up with the international standards... Without continued and substantial investment in various scientific research and experimental projects, how could you talk about any improvement!

Therefore, after hearing that his son-in-law had guessed his intentions through a few clues, Mu Siyuan looked at Yang Mo with admiration in his eyes: "Yes, I do have plans to focus on new materials. The headquarters cannot always be satisfied with the refining and synthesis of primary chemical raw materials, nor can it always only think about expanding the production capacity of raw materials such as acetylene and ethylene... From the various measures you took last year, Xiaomo, I learned that we can actually try to create and generate demand appropriately in the middle and lower reaches, so as to stimulate the upgrading of upstream technology."

At this point, Mu Siyuan waved his hand slightly reservedly: "Although I know that you are trying to help me achieve results, Xiao Mo, there is no need to apply for the 4.5 million budget... I have already made arrangements here. In two years at most, whether it is polycarbonate, nylon 6, or polyols, we should be able to try thousand-ton-level large-scale industrial production, and most of them are concentrated in the configuration system of the Solitary Island No. project."

After saying this, as if afraid that Yang Mo would misunderstand, Mu Siyuan looked at his son-in-law with a look of relief: "Xiao Mo, I know that if you intervene in this matter, you may be able to achieve results faster, but this involves new technologies and new processes after all, there are too many uncontrollable factors and too much risk... Letting the headquarters bear these risks and costs is actually the best move... As the saying goes, a tall tree attracts the wind, and you are too popular now, so it is best to play it safe."

Mu Siyuan's worries are very reasonable. Breakthroughs in technology and craftsmanship are a tortuous and long process. Many things may be fine in the laboratory, but once they are put into large-scale production, various problems will arise. Either the quality is not up to standard, or the actual cost exceeds the threshold, or there may even be safety accidents such as major explosions. But no matter what situation occurs, it is not a good thing for Yang Mo... Although there are many people who want to get on his ship now, there are also many people who hope that he will be unlucky. Once there is a chance, these people will definitely not hesitate to take advantage of the issue.

Yang Mo looked at his father-in-law with a complicated look. Looking back, if this design could be implemented together with the Linyi Petrochemical Industrial Park project, then perhaps Mu Siyuan's idea could really be realized;

However, it is already 1991, and Operation Desert Storm has officially begun. In three or four months at most, as the chain reaction of this military action that has had a huge impact on the whole world begins to emerge, my father-in-law's idea is likely to fail again.

There's no way, the enemies that often defeat you are not those within your sight.

Thinking of this, Yang Mo secretly sighed, but his voice was extremely decisive: "No, Dad, you must help me get this 4.5 million budget, otherwise I can only work alone!"

Mu Siyuan frowned immediately: "Xiao Mo... why is this?"

Yang Mo looked at him calmly and said word by word: "Because the headquarters is a central enterprise-type unit, these projects, along with these technologies, must not be directly under the central enterprise system!"

Ok?
Mu Siyuan savored these words carefully, and his brows knitted into a "川" shape: "...Why?"

Yang Mo sighed, then turned his head away, not daring to look at his father-in-law's eyes, and said lightly: "Because, the war has already started in the Gulf, and the advanced technology and systematic warfare methods that were completely beyond our expectations, as well as the overwhelming results, will inevitably make the country re-evaluate many major issues, and the attitude towards some things is very likely to be completely different from the past;"

"So, the headquarters' status as a central enterprise will become a huge constraint at that time... Dad, do you understand what I mean?"

Although Yang Mo's words were very obscure, Mu Siyuan understood the key to this in an instant. He couldn't help but gasp: "Xiao Mo, how is this possible? Although America attacked Iraq unexpectedly, this is just the beginning. How could it be...?"

Everyone on earth knows that Iraq is now known as the fourth most powerful military country in the world. Its military equipment is so advanced that it is even more powerful than a certain mysterious Eastern country. Therefore, it has a strong analogy effect... Although Iraq was bombed badly in the first two days, many people think that it was just because it was caught off guard. As Iraq reacts, the two sides should enter a stalemate. Yang Mo sighed: "Outsiders watch the excitement, insiders watch the doorway... Dad, you may not know much about wars under modern electronic systems, but I can tell you clearly... Iraq has no chance to turn over."

Hearing Yang Mo's confident words, Mu Siyuan took a breath and then wanted to ask him how he knew that.

However, when he thought that his son-in-law was no longer the same as before, he could get more information from the administrative system in addition to the news from this system, so he swallowed his words.

Mu Siyuan's heart sank to the bottom of the sea when he thought about the fact that Iraq, the object that could perfectly achieve the analogy effect, was defeated without any ability to fight back... Of course, he knew what kind of chain reaction this would cause, and he also knew what Yang Mo meant by "re-evaluation".

However, he found it difficult to accept this possibility emotionally, so he was so confused that he stared blankly.

Seeing his father-in-law remained silent, Yang Mo sighed again: "So, Dad, now you know why I asked you to do your best to help me get this 4.5 million budget, right?"

"Only by making use of my relationship with the competent authorities in Texas can I change these projects and technologies from being owned by central enterprises to local industrial projects in which local governments cooperate with central enterprises. Then, through equity redesign, with the China-Japan Economic Promotion Council as the middle point, and by introducing a small amount of private capital and foreign capital including overseas Chinese capital, I can turn it into a mixed-ownership project. This is the only way to avoid being stopped halfway or even being axed!"

Local industrial projects under cooperation between the central government and local governments?
Is this an attempt to use the name of Texas as a pilot city for tax-sharing reform to provide these projects with the first layer of protection?

China-Japan Economic Promotion Association?
A series of foreign capital including overseas Chinese capital?

Are you planning to use equity structure to provide a second layer of protection for these projects?
Ok……

Now my son-in-law has already started to implement the exchange plan of light and heavy industrial products, and is also trying to seek the commodity substitution plan and industrial circulation plan of the Bear Country with the northwest as the entry point;
If everything goes well, Dezhou and Lanling, as well as related enterprises participating in these plans, will be semi-compulsorily designated to purchase and use these new materials and related raw materials including polycarbonate, nylon 6, and polyols through bundling;
In this way, the problem of high costs caused by the immaturity of technology and craftsmanship in the early stage of these new materials can be well avoided... After all, the huge profits from trade with the Bear Country are well known to everyone;
Besides, his son-in-law is very good at cutting flesh to heal wounds. He is in charge of this economic cycle. It is not difficult to extract part of the profits from the rest of the parts to subsidize this link.

only……

Introducing foreign capital?

This matter is a bit taboo!

Thinking of this, Mu Siyuan pinched his brows and said, "Xiao Mo, you must be very cautious about the introduction of foreign capital. Do you have any planned targets?"

The implication is obvious. If you can avoid this risk, then I will risk my reputation to help you get the 4.5 million budget. Otherwise, even if you resent me, I will not help you... Not only will I not help you, I will even sabotage your plan when you work alone.

You are right. Since you are now the greatest support for us old guys, I can't just watch you commit suicide no matter what!
Yang Mo looked at his father-in-law quietly for a while, then smiled softly: "In fact, I have already set a goal; I will release about 9% of the shares for each project through a cross-holding equity tree;"

"I want to release 4% of it to the Chen and Lin families in Nanyang... These two families are well-known patriotic overseas Chinese and have supported many projects in the motherland over the years. Even though the chemical industry is relatively sensitive, I think no one will object to releasing a certain amount of equity to them as long as it does not exceed 10%."

Mu Siyuan nodded. Patriotic overseas Chinese are people that the country attaches great importance to. Although they all belong to the category of foreign capital, overseas Chinese capital is not the same as other foreign capital. There are also great differences between overseas Chinese capital and other overseas Chinese capital. Although the country has not explicitly stated patriotic overseas Chinese like the Chen family and the Lin family, the actual investment scope they have drawn up, except for some red line areas such as military industry, can be said to be almost unguarded... It must be said that his son-in-law knows how to judge the scale in this regard.

Yang Mo saw him nod and smiled again: "I will take out 5% of the remaining 4.5% and distribute it to Japanese chemical companies such as Teijin, Mitsubishi, Sumitomo, and GEP, or their chemical subsidiaries according to different project types;"

"Of course, I can't just distribute the shares to them. Instead, I will use the China-Japan Economic Promotion Council as an intermediary channel to have the China-Japan Economic Promotion Council initiate a package of combined projects, turn these projects into agreed asset packages, and let those companies set up project companies within the island country, and then participate in our projects in the name of the project companies... These combined projects initiated by the China-Japan Economic Promotion Council involve all aspects, and the new material chemical project is only a small part of them."

Emperor?

GEP?

Hearing about these now quite famous island chemical production companies, Mu Siyuan immediately understood that Yang Mo was also preparing a shield for these new chemical materials in the international market.

As for why they had to do this through the China-Japan Economic Promotion Council, and why they had to cooperate with those project companies in the form of an agreement asset package...

Although Mu Siyuan didn't quite understand these equity issues, he knew that Yang Mo was building a firewall.

Ok……

It doesn't even reach 5% of the shares. In addition, after being mixed up through various levels, these shares no longer fall into the category of direct investment. At the same time, there are also the 4% shares of the Lin family and the Chen family as a backdrop, so the sensitivity is suddenly weakened a lot.

only……

Mu Siyuan was puzzled: "With such a small share, we don't have much say in the project. Why would the companies in the island countries agree to invest according to our ideas?"

Yang Mo laughed: "Because the island country is a standard chaebol economy... You can tell from the names that these chemical companies are basically subsidiaries or affiliated companies of the consortium."

Mu Siyuan seemed to understand: "You mean, these investments are just incidental, and those island companies actually have other needs?"

Yang Mo nodded: "Otherwise, why is it called an agreement asset package? Dad, don't forget that with the collapse of the island's economic bubble, the country's companies and consortiums are forced to participate in a battle royale game!"

Mu Siyuan immediately understood.

He calculated in his mind: "What about the remaining 0.5% of the shares? The headquarters has a lot of technologies that can be spun off. If we set up related chemical projects, we can have a large number of companies!"

Yang Mo pursed his lips: "Dad, I just made it very clear, we still need to actively introduce social capital, so... the remaining 0.5% of the shares are prepared for them!"

Mu Siyuan frowned. "Although 0.5% of the shares may sound like a small amount, these are all asset-heavy chemical projects, and the scale of each project is at least tens of millions. At the moment, international oil prices are falling. Are they willing to invest in such a long-term, high-risk project that is highly positively correlated with international oil prices?"

Yang Mo looked at him with a smile: "Dad, it's not that scary. Didn't I say that these projects will be promoted in the name of central-local cooperation... To put it bluntly, it is to divest and reorganize the business based on local chemical companies;"

"It's just a reorganization, not a new one, why would it cost so much money?"

"Besides, not all private capital is so short-sighted. The state and central enterprises have the courage to expand production counter-cyclically. Similarly, township enterprises and private enterprises will also participate in this process out of strategic needs!"

Mu Siyuan couldn't help but twitch his eyes when he heard this.

Do the township enterprises and private enterprises in China today have the vision and courage to participate in the counter-cyclical expansion of production in the basic industry sector?
I'm afraid you're not talking about companies like Qingfeng Food and Xialiu Distribution Agency!

Only those direct units under your command would have the courage to do this under your guidance.

Moreover, I’m afraid that the 0.5% share distribution ratio was not originally intended for return on investment, right?
When Mu Siyuan thought about the consequences of Yang Mo's direct units participating in so many chemical projects, even if it was just 0.5% of the shares, his head couldn't help but get bigger.

You...

What you are doing is getting more and more excessive!

(End of this chapter)