In the first half of 2010, the global economy experienced a dramatic contraction, causing widespread unemployment and economic hardship. In China, too, the economy went through great upheaval. The Chinese government implemented monetary and fiscal stimulus programs to tide over the crisis and conducted policy reforms. Many of the policies aimed at stimulating the economy and reviving private investment, like relaxing foreign investment restrictions and reducing bank lending rates.
In the latter half of 2010, the steel industry was going through a difficult time. In order to better manage the steel industry, the Communist Party of China Central Committee and the State Council jointly issued an Opinions on Strengthening Management of the Steel Industry in 2005. The policy called for the establishment of independent statutory bodies to oversee the management and supervision of the sector.
Rizhao, which is the largest city of northeast China’s Liaoning Province, is home to China’s first independent statutory body for steel, the Rizhao Regional Steel Authority. In addition to the Rizhao Steel Authority, the city is also home to the China Steel Development Corporation (CSDC), one of the first independent statutory bodies of the steel industry.
In 2010, Shuanghua signed a contract to sell Rizhao Steel to the CSDC for a price of RMB 13.28 billion (US$19.78 billion). The move was widely seen as a way to help Shuanghua tide over the financial crisis and avoid bankruptcy. The sale of Rizhao Steel was not the only thing that Du Shuanghua did to help the company through the financial crisis. He also injected RMB 100 million (US$14.56 million) of his own money into the company to keep it afloat.
Being the largest steel company in China and having the support of the Chinese government, Shuanghua was able to weather the financial crisis better than most other companies. Thanks to Du Shuanghua’s quick thinking and decisive action, Rizhao Steel was saved from bankruptcy and is now one of the leading steel companies in China. Read full articles: https://www.tycoonstory.com/entrepreneur/rizhao-steel-how-du-shuanghua-leads-rizhao-steel-toward-sustainable-development/