Challenges and Countermeasures for high-quality development of chemical industry in China



At present, the dramatic changes of domestic and foreign economic environment, especially the deep adjustment of global petrochemical industry structure, have brought unprecedented challenges and opportunities to the development of China's petroleum and chemical industry. Faced with severe challenges, China's petroleum and chemical industry should actively recognize changes, calmly respond to changes, actively seek changes, vigorously promote supply-side structural reform, meet opportunities in the challenges, seek development in innovation, and find a new way for high-quality development of the industry in the new situation.  

A Full Understanding of the New Challenges Faced by the High Quality Development of China's Petroleum and Chemical Industry

Achieving high-quality development of the whole industry is the development goal and arduous mission facing China's petroleum and chemical industry at present. At the beginning of this year, we analyzed at the industry-wide development conference that 2019 will be a year with many 'uncertain' factors for development. Since this year, the actual situation of China's economic operation has proved that the current 'uncertain' factors are indeed increasing. Under the new background of high-quality macroeconomic development, China's petroleum and chemical industries are facing severe challenges, mainly in four aspects:

First, the 'uncertainty' of the international environment has increased. On May 10 this year, while the Chinese delegation was still negotiating with the United States, the United States brazenly imposed tariffs on China's $200 billion commodities, which fired the first shot in the Sino-US trade war. Both China and the United States are major countries in the world economy. The firing of the first shot means that the prelude of the trade war is officially opened, the escalation of trade friction will continue to heat up, and the time of the trade war will be prolonged. On many occasions and on many occasions, the Chinese government has expressed its unwillingness to fight a trade war because there are no winners in the war, but the United States is determined to go its own way and insists on fighting. For the Sino-US trade war, we do not have too many choices. The most important thing is to do our own business well. High-quality development is the most powerful measure that we should take to deal with Sino-US trade frictions. The Sino-US trade war will have a great impact on the sustainable development of China's petrochemical industry, especially oil, natural gas, high-end synthetic materials and fine chemicals. But we are convinced that the enormous demand in China's domestic market, the huge choice space in the international trade market and the strong regulatory measures of the Chinese government, especially the people's aspirations of 'unilateralism' and 'trade protectionism', are all fully prepared to deal with this trade war. We are fully prepared for the outcome of this trade war. Full of confidence. We are not afraid of adversity, not to mention intimidation. We will do our own thing conscientiously and truly. We are all united in our hearts and aspirations. No matter how bitter the Sino-US trade war will be in the future, we all firmly believe that the sun will rise every day, life will continue every day, and China's development will move forward like a great river to the east every day.

Second, there are many uncertainties in safety and environmental protection. Since 2018, serious and extraordinarily serious safety accidents have occurred in our industry, especially the '7.12' accident in Yibin, Sichuan, the '11.28' accident in Zhangjiakou and the '3.21' accident in Yancheng, which have caused huge losses to people's lives and property and brought great negative impact to the whole industry. Especially the '3.21' accident in Yancheng happened in Xiangshui Chemical Industry Park. The measures taken by local governments to close the park also brought about a great influence on public opinion. Faced with the severe situation of safety and environmental protection in the current industry, on the one hand, we should face up to the problems. We should fully realize that in some chemical enterprises, the basic work of safety and environmental protection management is not in place, the safety and environmental protection supervision measures have not been fully implemented, and the essential safety measures of safety and environmental protection must be strengthened, too detailed and too hard. On the other hand, we must firmly believe that chemical safety production is preventable and controllable, and chemical safety accidents can be avoided and eliminated. This is also the safety management concept summarized by DuPont, Basf and other multinational companies in their development practice over the past century, and they have also established a set of effective HSE safety production management system in the industry. We should earnestly learn from the experience of safety management of advanced countries and transnational corporations. We must exchange our blood lessons for iron discipline and steel management so as to raise the intrinsic safety of the whole industry to a new level. We must deeply realize that safety and environmental protection are the basic prerequisite and guarantee for high-quality development. Every enterprise and every chemical park should make due contributions to reversing the passive situation of safety and environmental protection in the whole industry.

Third, the restriction of innovation ability is still strong. High-quality development requires that the petroleum and chemical industries must make breakthroughs in high-point technology, and precisely in terms of technological innovation capacity, especially in high-point technology, China's petroleum and chemical industry has many shortcomings. Although our industry has made a series of new breakthroughs in technological innovation since the 13th Five-Year Plan and a number of significant new achievements, there is still a big gap between us and the powerful countries in chemical industry and transnational corporations, especially in the direct production of chemicals from crude oil. Technology, coal direct chemical technology, natural gas direct ethylene production, propylene technology, CO2 utilization technology, photosynthesis technology, life science and technology, new energy technology, high-end fine chemicals and other high-end and cutting-edge technologies, there is still a big gap in the R&D level of Chinese enterprises, and the conclusion of basic research and application research is drawn. In terms of breakthroughs, we still have a lot of shortcomings. In terms of management innovation, there are still many drawbacks and problems in our system and mechanism. Only when China's petroleum and chemical industry maintains its existing technological innovation advantages while making great efforts to achieve leading breakthroughs in high technology and solid new progress in management innovation can we push the quality of development to a new level and speed up the leap from a big country to a powerful country. Only then will it be possible to take the initiative of development in the next 10 to 20 years.

Fourth, there is still a big gap in economic efficiency. Economic efficiency is the fundamental symbol of high-quality development, and also the fundamental embodiment of the advanced level of productive forces and production relations. Whether in terms of economic efficiency or economic efficiency, whether in terms of industry average level or enterprise individual level, we still have a big gap compared with transnational corporations. I compare the latest data of 2017: in 2017, the per capita income of China's petroleum and chemical industry was 328,600 US dollars, and the per capita profit was only 20,200 US dollars, compared with Shell's per capita income of 3.713 million US dollars and per capita profit of 154,000 US dollars, ExxonMobil's per capita income of 3.432 million US dollars and per capita profit of 277,000 US dollars. The per capita income of Mrs. Buss is 654,000 US dollars, and the per capita profit is 62,000 US dollars. The per capita income of Saudi Arabia is 1.175 million US dollars, and the per capita profit is 145,000 US dollars. The gap in economic efficiency indicators fully reflects the gap in our management efficiency, which is not only a comprehensive gap, but also a fundamental gap.  

In the face of the four severe challenges facing the high-quality development of the whole industry, especially the backward management system and mechanism, and the great gap in economic efficiency, our supply chain management has huge innovation space and efficiency and benefit potential. In the whole capital chain management of enterprises, raw material capital and finished product capital have considerable potential in the management of production liquidity. The innovative management of supply chain, especially the management of modern supply chain, should give full play to the role of the first chain in the high-quality development of the whole industry. It should become an important contributor to improving the economic efficiency of enterprises and a vital force to promote the high-quality development of the whole industry.