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Development Trends and Countermeasures for the Chemical Industry during an Economic Downturn Source: HuiCong Plastics Network On April 2, the Capital Exchange • Yangtze River Delta Chemical Industry Crisis Resolution and Development Forum, themed “Development Trends and Countermeasures for the Chemical Industry during an Economic Downturn,” was held with great success at the School of Management of Fudan University in Shanghai. “Under the severe impact of the international financial crisis, companies are actively seeking ways to overcome difficulties in such a challenging environment. Thoughts determine the path forward; the mind determines one’s wealth; positioning determines one’s status. I used to focus only on my own business, but now I need to pay attention to industry issues as well as my own problems. The chemical industry needs this open dialogue to discuss the crisis together and overcome difficulties as a community. ”He Zhenming, editor-in-chief of Chamber Network, one of the organizers, mentioned in a media interview many new industry paths that are currently being hotly discussed by entrepreneurs. Last year, the chemical industry suffered a severe impact due to the financial crisis of 2008, which was like an economic storm that affected all sectors. So what is the situation for China’s chemical industry? In his opening speech, Professor Lu Xiongwen, Dean of the School of Management at Fudan University, first reviewed the overall situation of China’s economic landscape. Professor Lu Xiongwen said, “Today, the inevitable arrival of a crisis also gives us an opportunity to think calmly and learn anew. Only corporate leaders who have experienced crises can become true entrepreneurs.” First and foremost, we must strongly call for corporate transformation. If enterprises fail to change their growth models, the sustainable growth of the Chinese economy will be threatened. Secondly, we must strongly call for a revival of entrepreneurship. Chinese entrepreneurs should maintain and carry forward the enterprising spirit and positive attitude toward innovation that they have shown over the years, seeking new breakthroughs to emerge from the current downturn. ” In his subsequent speech, He Zhenming argued that maintaining clear thinking in times of crisis is the key to helping entrepreneurs get through difficult times. In his keynote speech on the \"Development Trends of the Chemical Industry in the Context of Financial Crises,\" Professor Li Ruoshan from the School of Management at Fudan University noted that it was in November and December 2008 that the economic crisis had a significant impact on China’s chemical industry. He said that when the global financial crisis broke out in 2008, our country did not feel its impact significantly; it was actually only in September that the effects began to affect our economy gradually. As a corporate entity, it finds itself at the forefront of economic trends; signs of these trends could be observed even before September. After September, although the company’s sales were not greatly affected, from a market perspective, it became apparent that there were certain factors of economic instability lurking in the market. As anticipated, the economic crisis in the last two months of 2008 had a profound impact on our country’s chemical industry. The 4 trillion yuan investment plan is beneficial to the chemical industry. Last November, a fiscal stimulus package worth 4 trillion yuan was introduced to revitalize the economy, providing substantial financial support to China’s economic sector. Will this also benefit China’s chemical industry? This issue was discussed at length at a capital interaction forum attended by Xu Qiutang, president of the Shanghai Chemical Industry Association; Jiang Baolong, president of the Shanghai Dongyang Chamber of Commerce and general manager of Shanghai Juhua Industrial Development Co., Ltd.; Li Shijie, party secretary and general manager of Huasheng Company; Yang Lijiang, deputy director of the Investment Promotion Bureau in Zhenjiang New Area; Wang Zhongyu, China manager for the consumer goods business at Evonik Degussa Group; and Li Guohua, technical director of Shanghai Chemical Industry Park Development Co., Ltd. Xu Qiutang, president of the Shanghai Chemical Industry Association, said it is an undeniable fact that the new policy involving 4 trillion yuan cannot benefit all chemical enterprises. Private enterprises do not receive the same level of financial support as state-owned enterprises, which increases the difficulties in operating them. In the past, most private enterprises relied solely on resources and engaged in energy-intensive production; now they are gradually shifting toward a technology-driven approach. Some small private enterprises have also managed to carve out their own niche through continuous innovation. However, due to financial constraints faced by private enterprises, most of them are currently confined to the field of fine chemicals. Additionally, **to support products in certain chemical industries, relevant export tax rebate policies have been introduced. Take fertilizers, for example: the fertilizer market remains weak at present. Although the number of companies that have stopped production has decreased compared to before, the rapid growth in previous periods has led to an oversupply in the market. This economic crisis has exposed such underlying risks ahead of time. **The introduction of relevant policies is undoubtedly beneficial for the fertilizer industry to improve its operational conditions and adjust its industrial structure. Companies are taking measures to save themselves and launching a defense campaign for the chemical industry in 2009. The holding of this capital conference coincides with an intensifying financial crisis, and many of the attendees have a deep understanding of the current situation. Many experts, scholars, and industrialists shared their personal experiences on how to overcome difficulties and pursue development in the face of the financial crisis. Li Shijie, General Manager of Huasheng Company’s Party Committee, said that after several quarters of hard work, we may see a stabilization in the economic situation. He made every company fully aware of the current situation in the chemical industry, and urged them to find ways to maintain a smooth cash flow. Wang Zhongyu, the China manager for the consumer goods business at Evonik Degussa Group, believes that business leaders must keep a clear head. He said that over the years, the chemical industry has made progress, but at the same time there has been an accumulation of excess production. Even after the impacts of the financial crisis subsided, many companies still faced difficulties as their production was excessive and prices could not rise, so the situation did not improve. Companies need to plan for the long term and take careful steps forward. At the beginning of the new year, many experts believe that the production volume of enterprises increased in 2009, indicating that the economy is recovering; raw material prices are gradually falling, the selling prices of finished products have also risen to some extent, and market demand has seen an improvement as well. At the same time, **macroeconomic adjustments** and export tax rebates also help various enterprises find their proper position. Chemical companies need to clarify their thinking, understand the current situation of the industry, and respond to the crisis in a clear and unified manner.