Chapter 715: Rejecting Japanese Capital_1

The liabilities exceeded assets.

Nie Zhenbang could understand such situations. Like the case of Red Star Factory, this was not uncommon among various state-owned enterprises across the country.

Basically, they failed to grasp the pulse of the market economy. The products they produced had no market. The more they produced, the more they lost. The deeper the loss, the more it was like a bottomless pit, continuously draining funds, which instead led to a greater degree of loss. Not only did this pose a massive financial burden for local governments, but it also caused a lot of trouble for social stability.

Furthermore, these enterprises were financially chaotic. Even if there were to be restructuring or sales of the enterprise, few were willing to take over. Today's private business owners are not fools. These enterprises not only have various problems, but they would also have to bear a lot of debt once taken over. This could severely hinder their own development.