Missing Chance Means Deathward--About JBP's Bankruptcy(1)

The former Ji'nan Bearing Plant(JBP), located at No.492 Jingshi road Ji'nan city Shandong province, now has become a warehouse for reserving the discarded equipments. In the period from 1999 to 2001, JBP had been granted a large amout of compensation fee by the Ji'nan government but they failed to make good use of the capital to put them out of troubles. On April 28 2005, 90 worker representatives attended the Bankruptcy Voting Meeting of JBP which was held at their new plant site--No.144 Jiwei road. In the course of that meeting, 76 of the 90 representatives agreed to the bankruptcy of JBP. What the JBP should face is nothing but bankruptcy.

From Peak to Crisis

Before 1990s, JBP was the model and leading enterprise in Ji'nan bearing industries. Meanwhile, its also one of the manufacturers who were authorized by State Railway Ministry to produce 197726 railway van bearings. In that period, JBP's economic benefit ranked from 3rd to 4th among the dozens of machinery manufacturing plants in Ji'nan.

JBP's crisis was starting when wage payment of JBP was delayed for the first time in the early 1993. From then on, payment delay became more and more often. Later, even wage arrears occured. By the end of 2004, the amount of arrears of wages had hit RMB13.01 million yuan. According to the former vice president of JBP, it's the reform of state macro economic system that caused various crisis of JBP. Before the reform, government appropriated money for enterprises' development but the enterprises should hand in all their operating margin to the government; after the reform, government only provided a loan to the enterprises but enterprises could keep their operating margin after paying certain amount of tax.

As a result of not adapting to the new economic system, JBP found themself in great troubles in 1990. 40 percent of workers who got their wages regularly in JBP were retired workers; most equipments had been used for several decades; plant buildings were no longer suitable for manufacturing. So many troubles the JBP should face. At that moment, new manufacturing plants were built one by one in south China. Owing to their advanced equipments and technologies, the new soutn China plants became terrible competitors of JBP.

In the middle 1990s, agricultural vehicle's manufacture became the profitable business in Shandong province. So bearings for those vehicles also became popular. But the same type of bearing made by JBP was two times expansive than those made by other new plants.

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