Chapter 1229: Ten-Year Plan – 235 Plan

"Mr. Xia, I wonder what your other opinions are?'

Xia Yu's two consecutive opinions directly pointed to the crux of the matter, making Liu Zhongfei even more eager to hear Xia Yu's later opinions.

'These latter ones are more appropriately described as intentions to solve problems than opinions.'

'The third one is that Guangdong's steel production supply is low, and cannot support the long-term development of industry.'

'Although most of the investments in Guangdong Province are in light industry factories, such as textiles, toys, electronics, and the like, there are still some industries that have a great demand for steel raw materials.'

'As far as I know, there is not a single large or medium-sized steel company in Guangdong Province, is there?'

Although it was a question, Xia Yu's tone was very certain.

Even in later generations, Guangdong Province's steel consumption exceeded 10% of the national total, but its production accounted for less than 5%. The shortfall had to be made up by imports from the north, which were costly.

In later generations, Guangdong Province's large and medium-sized steel enterprises were limited to Shaoguan Iron and Steel Works, Yangcheng Iron and Steel Works, Zhujiang Iron and Steel Works and one large private steel company.

Now, none of these four have appeared yet!

Liu Zhongfei's face fell a little, but he faced the problem head-on and said, 'It's true that there isn't any. The entire Guangdong Province's crude steel output is less than 500,000 tons.'

According to statistics from the National Bureau of Statistics, last year's national crude steel output was 37.16 million tons. Although the three eastern provinces alone accounted for 60% of the national crude steel output, Guangdong Province's crude steel output was indeed too backward.

Not to mention that Guangdong Province's economy has now surged from being among the top 20 in the country a few years ago to now being among the top 3 in the country, but the crude steel output is...

This is a disgrace!

But Liu Zhongfei is a man of action, and he doesn't care much about face.

The key is what Xia Yu said, that the hidden worries behind this extremely low crude steel production volume really have to be solved in advance.

He knows that the higher-ups want to bring the Rolls-Royce Motor Cars Group to the mainland, and he wants to bring it to Guangdong Province, which he oversees, to create a pillar automotive industry for the province.

Now that Miss Elena from Rolls-Royce Motor Cars is still in Guangdong Province, and Xia Yu, an important intermediary, is also here, this is the best opportunity, and he doesn't want to miss it!

However, as a heavy industry, the automobile industry has a high consumption of steel. If the steel output is insufficient, even if Rolls-Royce Motor Cars is brought here to settle, there will still be many problems.

'Mr Xia, are you thinking of investing in the construction of a steel mill?'

Liu Zhongfei said, looking at Xia Yu with burning eyes.

Xia Yu smiled and nodded, saying, 'Yes, steel is one of the four major raw materials of modern industry. If Guangdong Province does not have sufficient steel production, it will lack an important guarantee for reform.'

'I have also looked into the steel layout on the mainland. There is more steel in the east and less in the west, and more in the north and less in the south. Steel production and capacity are concentrated in the north and the east-central region, with the north alone accounting for more than 60%.

'The central part is concentrated in Sichuan and Hubei provinces.'

'Now the eastern part is beginning to be laid out, and the mainland has also introduced the technology of the island country Nippon Steel, establishing Baoshan Iron and Steel Co., Ltd. to support the industrial development of the Yangtze River Delta.'

'And in the south of the mainland, there is none at all, it is completely top-heavy.'

'It was proposed in 1978 that ten major iron and steel bases be built by 1985, and there is not one in Guangdong Province, or in the southeast!'

'Many Hong Kong businessmen have discussed this topic with me. Guangdong Province lacks the ability to supply iron and steel, and there are few types of steel, which restricts their investment. This problem needs to be solved urgently.'

'However, I also understand the situation on the mainland. Creating a Baosteel has taken away most of the resources. Guangdong Province lacks the conditions to follow suit. Instead of waiting, I might as well do it!'

'I wonder what you think, Secretary Liu?'

Liu Zhongfei said without hesitation: 'I fully support and welcome your investment in Guangdong Province, and on the policy front, the top has already opened the door. On behalf of Guangdong Province, I will do my best to facilitate your work!'

'Mr Xia, I would like to ask you, what are your plans for this steel company?'

Xia Yu smiled and said, 'My personal intention is to divide it into three stages, which I call the "235 plan". The first stage is to build a steel plant from scratch and officially put it into production within two years, with a crude steel production capacity of one million tons. The second stage is three years, during which the crude steel production capacity will be increased to three million tons per year. The third stage is to further increase the production capacity within five years, so that the crude steel production capacity will reach 10 million tons per year!'

Ten million tons!

A total of ten years, which means that by 1993, the crude steel production of a company will be increased to ten million tons!

Liu Zhongfei and Li Bin were both impressed by Xia Yu's grand plan!

They had both experienced the Great Steel Campaign, and naturally knew the difficulty of steel smelting. The mainland had made concerted efforts across the board, and it had taken decades to increase crude steel production to just over 37 million tons!

And most of it was very poor quality steel that could only be used in light industry with low technology and low requirements. There was very little high-grade steel that could be used in heavy industry!

According to the mainland's iron and steel industry development plan and the inferred development trend, it would be good if the mainland's crude steel output could reach 80 million tons in 1993.

If Guangdong Province could have a crude steel output of 10 million tons, no, if there was an iron and steel company with an annual crude steel output of 10 million tons, Guangdong Province would soar to the sky!

Liu Zhongfei and Li Bin also believe that by then, Xia Yu's steel company will become the leader of steel companies in the country!

This honour will also belong to Guangdong Province!

'Mr Xia, you're not joking, are you?'

Liu Zhongfei asked, his voice trembling a little as he looked at Xia Yu with a face full of excitement.

Xia Yu nodded firmly, 'I'm serious. Before I came, I already had a meeting at Kyushu Industrial Group.'

'Yes, Secretary Liu, the boss already mentioned it at the meeting,'

Luo Yunfei, who had been silent, immediately explained, seeing the gaze of Liu Zhongfei and Li Bin.

The smiles on Liu Zhongfei and Li Bin's faces blossomed completely, both laughing like chrysanthemums.

'Mr Xia, please rest assured, the Guangdong Provincial Government will do its utmost to support you and remove all obstacles for you!'

Liu Zhongfei solemnly promised.

'Then I would like to thank Secretary Liu first,'

Xia Yu smiled lightly.

In fact, this plan to increase production capacity by 10 million tonnes was a decision he had made after careful consideration.

Guangdong Province's crude steel output was currently less than 500,000 tonnes, which was sufficient to meet the province's demand for the time being.

Two years later, in 1985, if his steel company began production, together with the expansion of other steel companies in Guangdong Province, the province's crude steel production capacity could exceed 1.5 million tonnes.

And after next year, the spring breeze will surely blow across the land of China. By then, the reform and opening up of Guangdong Province will officially enter its climax stage. The demand for steel from the enterprises springing up like bamboo shoots after rain will increase significantly, and even 1.5 million tons of production capacity at that time will still be able to supply.

Then, in 1988, the production capacity will be increased to 3 million tons, which Guangdong Province may not be able to consume, but it can be radiated to Fujian Province and Jiangxi Province.

By 1993, production capacity had increased to 10 million tons, and Guangdong Province could not consume all of it. At that time, it was enough to cover the southeastern provinces and even enter the Jiangsu and Zhejiang areas to compete for the market.

This gradual expansion of production is very prudent and will not lead to problems.

A production capacity of 10 million tonnes is also sufficient. In Xia Yu's plan, the scope of influence of this steel company in Guangdong Province is the southeastern part of the mainland. If it continues to go north, it is no longer the business of the steel company in Guangdong Province. Not to mention the high transportation costs, there are too many steel companies in the north, and there are also local protection policies, making competition very difficult.

By then, instead of expanding production in Guangdong Province, they will have to go to other provinces to carry out mergers and acquisitions, or open branches in other provinces, pay taxes to the local provinces, so as not to lose out on competition.

'Mr Xia, don't mention thanking me, I should be thanking you. If you set up an iron and steel company in Guangdong Province, it will be a good thing for the country and the people!'

'Yes, Mr Xia, Pengcheng definitely welcomes your investment and the establishment of factories. You can build wherever you want...'

...

'Secretary Liu, let me talk about the fourth and fifth ones!'

'Please go ahead!'

Liu Zhongfei and Li Bin immediately stopped smiling and looked expectantly at Xia Yu.

'These fourth and fifth ones are still closely related to the industrial development of Guangdong Province.'

'As we all know, the four major industrial raw materials are rubber, steel, coal and petroleum. We already have steel.'

'As for rubber, Guangdong Province is close to Southeast Asia, and most importantly, the Hong Kong Futures Exchange has already listed natural rubber futures. Rubber warehouses are also being built in the New Territories, and there is a rubber production company in the Yuen Long Science and Technology Industrial Park. At that time, we can just import it. If we develop it ourselves, not only will the cost be high, the results will also be slow.'

'The rest are coal and oil.'

'So I plan to set up a coal mining and processing company and a petrochemical company.'

'Solve the problem of raw material supply for industrial development in Guangdong Province once and for all, and boost the industrial and economic development of Guangdong Province!'

After saying this, Xia Yu looked at Liu Zhongfei with a smile on his face.

However, the latter's face looked troubled this time.

The steel industry is relatively more open on the mainland, and he is confident that he can get it for Xia Yu.

But the coal and petrochemical sectors are much more difficult!

The interests and disputes between the local governments and factions involved are not trivial.

He is not very confident either!

For a while, the sound of a needle falling could be heard in the drawing room...