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Private companies are progressively replacing old, state-owned firms in this dilapidated city



Posted April 7, 2004

Three hours southeast of Wuhan, Jiujiang's claim to fame is its proximity to Lu Shan, a popular mountain resort located about thirty miles from the city. But tourists typically give Jiujiang a miss, with good reasons.

Located on the banks of the Yangtze River and with some lakes in its center, Jiujiang, with a population of about 400,000, could be a beautiful city. But the beautification projects meant to capitalize on this potential have yielded incomplete results.

In the center of the city, the banks of Lake Gantang have been pleasantly landscaped. Elsewhere, the sidewalks are uneven and potholed, the air reeks of old garbage, and historic landmarks have been poorly maintained. A newly built scenic walkway along one bank of the Yangtze is unattractive, owing to the great amount of dust generated by nearby factories and construction sites.

UNREALIZED POTENTIAL Jiujiang is home to several poorly maintained landmarks.
Photos by Jean-François Tremblay

Residents I met in restaurants were quick to complain about the economic restructuring taking place. They said state-owned companies are shutting down, but private enterprise is too slow in taking their place. One diner blamed the corruption of public officials who flee abroad with money collected illegally.

One of the state-owned companies still operating is Jiujiang Chemical Fiber. Located about 20 minutes from the center of Jiujiang, it is a sprawling and unattractive manufacturing center above which hovers thick black smoke. It produces viscose, alpha pulp, and toilet paper. It employs thousands of people, most of whom wear the company's brown uniform.

In an attempt to obtain an interview, I went to the company's "political department," the equivalent of corporate communications in a private company. The director was in a meeting. The offices were decrepit, and a strong smell emanated from a bathroom. While I was waiting, a young cameraman told me that I would be better off going to a privately owned viscose producer that sits on a hill next to Jiujiang Chemical Fiber. "We're an old state-owned company; we're not that interesting," he said. I agreed.

The Sateri (Jiangxi) Chemical Fibre plant is everything that Jiujiang Chemical Fiber is not: clean, modern, and it does not employ as many people. I freely walked through this Finnish company's site as I was looking for its administrators. Judging from the noise and level of activity, operators were conducting a test run. But unlike at the nearby state-owned firm, there was hardly any smoke coming out of the chimneys. As I appeared unannounced at her office, an administrator told me somewhat curtly that she could not divulge anything about the plant.

SPANKING NEW A Sateri viscose plant, next to Jiujiang Chemical Fiber, is gearing up to start commercial operation.

Reached later on by email, Wu Tao, the export manager of the venture, provided some details about the plant. With an investment of $215 million, Sateri is Asia's largest viscose producer, he said. Construction of the plant was completed in February, and commercial production will start imminently. Most of the raw material, dissolved wood pulp, is imported from Sweden, Brazil, and other countries.

Later in the evening, I met at my hotel with Tian Ye Hua, founder and CEO of Jiujiang Huaxiong Chemical, and his daughter Tian Fang, who manages the company's sales. I had driven up to their company's site earlier in the day. Located along a single-lane dirt road in the countryside surrounding Jiujiang, Huaxiong had felt more like a farm than a chemical company.

But appearances were deceiving. It turns out that Tian senior is an expert in analine catalysts, and he has been producing the materials as well as other copper silica gel catalysts for about 30 years. He has written two books on copper silica gels and is occasionally invited to speak on the subject at conferences in China. Tian, who studied Chinese literature in college, learned about aniline catalysts while working at a state-owned chemical company. His daughter speaks English and has an M.B.A. from Xian University of Technology.

The Tians
Tian senior formed Huaxiong in 1986. He chose the rural setting precisely because it was isolated. If he were in a residential neighborhood, he said, his plant would bother the neighbors. He started out with 24 employees but now has 64. With $200,000 in annual sales, the company offers 10 products, mostly aniline catalysts and catalyst carriers. Tian and his daughter retain full ownership of the company. "I enjoy the freedom of making all decisions," Tian senior said.

He said that Huaxiong competes on the basis of its production processes and that he continually improves these. Various Chinese official agencies have awarded prizes to his products over the years. The Tians now plan to enter the export markets, where they will compete against giants like American Cyanamid and Bayer. Tian senior is confident that his products perform better than foreign-made materials. His daughter is more circumspect. "We'll just see how it goes," she said.

[Back to Chronicling the Yangtze River]

  Chemical & Engineering News
ISSN 0009-2347
Copyright © 2004

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