Hong Kong's manufacturing industry is very developed, but the core of this development is actually light industrial production and assembly, focusing on clothing, toys, watch OEMs, and electronics OEMs. With low labor costs and a good tax environment, many people are still mixed up. Things are booming.
But the problem is that they are caught at both ends. The raw materials for the products can only be imported, and the markets are all overseas. The raw materials for clothing and toys come from by-products of petroleum refining. The main markets for watches and electronic OEMs are also abroad. Nowadays, oil prices have skyrocketed. The European and American economies experienced negative growth, with one positive and one negative. Hong Kong's manufacturing orders immediately experienced an unprecedented collapse.
Coupled with the skyrocketing crude oil prices, the freight prices of various types of sea and air transportation have also skyrocketed, and there are conflicts in the Middle East. The main markets for Hong Kong's manufacturing industry are Europe and the United States. The meager profits made by Hong Kong's manufacturing industry based on low-cost labor have continued to decline. I can’t even afford the sea freight.
When the chain reaction of the oil crisis spread to Hong Kong two months later, the stock prices of manufacturing companies listed in Hong Kong also entered the list of plummeting. In addition, Hong Kong's domestic crude oil supply also began to have problems. Oil prices remained high. Not only did Hong Kong face Stock prices and land prices plummeted, and the prices of normal vegetables and daily necessities also began to rise significantly.
Problems have arisen in the manufacturing industry, which is the largest source of employment. A large number of employees have been laid off or forced to reduce their incomes, while the cost of living has increased sharply. The power of inflation has plunged Hong Kong society, which has been developing smoothly for decades, into an economic death spiral.
Even the busiest middle ring road section has clearly seen a decrease in the number of crowds and traffic.
In Prince's Building, the headquarters of Galaxy Company, Chen Zhiwen stood in front of the floor-to-ceiling windows, looking at the Harbor City under construction opposite Victoria Harbor, and fell into deep thought.
In the entire Hong Kong real estate industry, what he is most interested in is Harbor City, which will be known as Asia's first shopping paradise in the future. It is unique in Hong Kong in terms of area and geographical location, not to mention the rent of tens of billions of Hong Kong dollars a year in a few decades. , after it was built in the 1980s, the annual rent could reach hundreds of millions of Hong Kong dollars, and the entire investment cost could be recovered in less than five years.
Of course, there are only construction costs here, because the most valuable land itself belongs to the Wharf Company, so the land cost is counted as 0.
If he was allowed to operate this kind of investment with such a high rate of return, he would definitely finance it from the bank, use other people's money to build it first and then operate it and repay the loan. However, Wharf and Jardine Matheson behind it are not very confident in this project. , coupled with its conservative management methods and unwillingness to receive large-scale receptions, it only relied on the rental income from other Wharf locations and the money raised in the stock market to build slowly. The entire construction period was almost 10 years, and in fact 5 years was enough. .
However, this also has certain benefits. Wharf has released a large number of shares through a large increase in share financing. Naturally, Chen Zhiwen will not let it go. In addition to the deposits previously paid to major chemical and oil giants, he also has 1 With a capital of 100 million, he also absorbed a lot of shares during the period when Wharf increased its shares, but the current total amount is not very large. After all, Jardine is still at its peak. Whether it is the real estate crisis or the oil crisis, it has not let him down. It's really nerve-wracking.
"Dong dong dong..." After the knock on the door, the voice of assistant An Qi sounded outside the door again: "Sheng Chen, Mr. Smith from Tao is here."
"Please come in." Chen Zhiwen turned around and saw this familiar face that he had been looking forward to for months. He couldn't help but smile happily: "Mr. Smith, long time no see."
"Yes, Mr. Chen, long time no see." Smith shook hands with Chen Zhiwen and said, "I have just returned from the United States. The first thing I did when I came to Hong Kong was to come to see you, Mr. Chen."
"Is there any change in our cooperation?" Chen Zhiwen asked as he led Smith to the sofa in the reception area and sat down.
Angel also served two cups of coffee. After Smith took a sip, he said, "Don't worry, Mr. Chen, there will definitely be no problems with our cooperation. According to our agreement, this batch of plastic particles will soon be in Los Angeles." The ship will be boarded at the port and will arrive in Hong Kong at the end of next month."
"The turmoil in the Middle East this time will have a great impact on your company, right?" Chen Zhiwen asked.
"Of course it has a big impact. Three factories in Europe and the United States have already shut down, and other factories have also reduced production. Even the products given to you this time are all in stock before October." Smith said calmly on the surface , but there was a burst of physical pain in my heart.
Major companies will have a certain inventory of common consumables. Plastic products have a large market consumption, and they are not as flammable and explosive as other chemicals. The storage cost is low, so a lot of them are naturally stored in warehouses.
Theoretically speaking, if there is a problem with oil, it will actually take several months to affect the output of terminal petroleum products. However, capitalists are not fools. With raw materials soaring, how can terminal products still be calculated at the previous cost?
Although companies like Dow have signed early agreements with a large number of customers, under normal circumstances, the liquidated damages in general contracts are not high. Coupled with the current international situation, there are sufficient reasons for breach of contract.
But customers are also divided into levels. It doesn't matter if ordinary small customers pay compensation for breach of contract. These small customers can only admit defeat. After all, there are big problems all over the world.
And there are some that absolutely must be supplied normally, such as automobile giants, home appliance giants, top companies in other industries, etc., and the price will be appropriately increased by one liter at most. After all, for Dow, the previous inventory was at most It's just a small profit. If there is a stalemate with the automobile and electrical appliance giants, it will ruin the long-term business.
When Smith went to the United States, he also went to the company's senior management. After stating his interests many times, he got the transaction to be executed normally. After all, the northern mainland is the dream land of all European and American companies, especially in Western countries. fell into recession.
Chen Zhiwen nodded and smiled. He naturally knew whose tiger skin he had borrowed, and said: "Mr. Smith, for some reasons that I cannot say, our cooperation may change. I want to entrust this batch of plastic particles to Dow." Dispose of them in the international market, or of course, sell them to Dow at a discounted price, and then resell them to others."
"This..." Smith frowned. Chen Zhiwen had already mentioned the reason why he couldn't say it. He would definitely not tell him if he asked him. But he guessed that it might be because the northern mainland government saw the price of plastic raw materials in the international market. It has skyrocketed several times, and you want to sell it again, make a profit difference, and become a second-rate dealer?
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