Chapter 200 When Others Retreat, It's Time for Us to Advance: No Laughing
Since the goal is to connect large domestic enterprises with Moscow to hold trade fairs, the embassy is naturally an unavoidable step.
Wang Xiao was under immense pressure from the $1 billion loss and was in a frantic rush, unable to wait any longer.
Using vehicles, they surveyed the entire 80-acre plot of land, and without even returning home, they split into two groups.
Ivanov needed to complete the land-related procedures and find workers to carry out the renovations. At the very least, they had to lay the concrete floor first.
Wang Xiao, on the other hand, set off for the embassy to discuss the holding of a large-scale China Commodity Fair.
The ambassador was unavailable, so it was the counselor who personally received Wang Xiao.
Upon seeing him, he smiled and said, "Mr. Wang, why didn't you call ahead? We could have made time for you."
Wang Xiao quickly raised his hand: "Please don't joke around. You are all doing important things. There is no reason for you to make time for me."
"Oh, please." The counselor gestured for Wang Xiao to drink some tea. "Try it, it was just brought back from China. You're underestimating yourself. We're always ready to serve you."
To put it bluntly, the extra half of the workload at the embassy was basically arranged by Wang Xiao.
Originally, nobody cared about profiteering, but now they can't ignore it.
Wang Xiao chuckled and said, "Since you put it that way, I'll get straight to the point. As you know, our company also acts as a middleman, facilitating barter trade between companies in both countries. However, the ruble is too unstable and depreciates too quickly, so the Russian side's ability to fulfill its obligations is very weak. We estimate that this kind of trade model will basically be unsustainable in the future."
The counselor nodded in deep agreement.
Why isn't the ambassador here today? Because he was pressured by personal connections to mediate a dispute.
The head of a research institute under the Chinese Academy of Sciences, in partnership with a private company, signed a contract with a Chinese enterprise at the Harbin Trade Fair for fertilizer in exchange for light industrial and textile products. However, while the Chinese company delivered the goods, the research institute delayed accepting them due to incomplete paperwork.
As time went on, the research institute couldn't sell the textile products it received. The fertilizer, because they couldn't afford warehouse rent, was left in the open for extended periods, and after being soaked in rain, it became ineffective.
The head of the research institute owed money to Huaxia Enterprise for goods. The enterprise had been demanding payment for more than half a year and had reached its limit, so it was preparing to sue the research institute.
Someone then approached the ambassador, hoping he could mediate and try to avoid litigation.
The counselor estimated that this kind of situation would become more and more common in the future.
Wang Xiao sighed: "That's right, these disputes are giving us a headache. Looking at the domestic economic policies, they are about deepening reforms and unleashing productive forces. But our national conditions mean that if we loosen restrictions on light industry even slightly, it will be very easy for it to become overcapacity. We have to export and find markets in order to develop."
"I thought we need to expand the influence of Chinese products in the Russian market and even the entire CIS countries, so that more people can get to know our products."
"Seeing is believing, so let's hold a large-scale China Commodity Fair in Moscow to attract visitors from all over the world and explore more cooperation opportunities. I know there have been export commodity fairs in recent years, but they are too small in scale and too narrow in scope; they are not enough. If we're going to hold one, let's make it big."
The exhibitor expressed interest: "This is a good thing, it's definitely worth doing. The only issues are the venue, and the meals and accommodations for the exhibitors, all of which need to be coordinated."
Wang Xiao immediately took on all the responsibilities: "We'll rent the venue, and we'll arrange the meals and accommodation. We just need to trouble the embassy to help us contact relevant organizations in China. It gets cold early in Moscow, and we'd like to hold this trade fair in September."
The counselor was taken aback; it was almost August, and there was only about a month left until September.
Organizing a large-scale exhibition and trade fair requires a great deal of preparation. Just arranging for domestic exhibitors to send samples can take a week by train.
Wang Xiao insisted: "At the latest, late September. Otherwise, it will be very troublesome to arrange everything in Moscow when winter comes. If we wait until next spring to do this, it will take almost another year."
Although the counselor was a little hesitant, he nodded in agreement: "Alright, we'll try to contact them. You'll need to confirm the specific time and place."
Wang Xiao flashed his signature second smile: "Of course, I await good news."
The counselor personally saw Wang Xiao out, then immediately turned around and gave instructions: "Get moving quickly, there's no time to waste."
His subordinates instantly showed pained expressions: "My God, these bosses are real capitalists, whipping people to work. They're supposed to start in September! And we still have nothing!"
The secretary laughed: "I think that's the kind of speed you need to be a boss to do business in Russia."
The dispute in which their ambassador was pulled in to help mediate was, frankly speaking, simply because the head of the research institute was too lazy and procrastinating.
He and a private company jointly signed a contract with Huaxia Factory.
The owner of the private company, a young woman, immediately took her bodyguards to order train cars after receiving the shipment news and received six train cars of goods.
She didn't hide it from the research institute and informed them openly.
But the person in charge was used to bureaucracy; he would feel uncomfortable if a task that could be completed in a day took a week to finish.
He didn't do anything after receiving the news, and let the owner of the private company take away half of the textile products first.
But the female boss wasn't one to dawdle. After selecting the goods, she immediately went to wholesale to stores of all sizes.
By the time the head of the research institute finally went to collect his goods, the market had already been completely taken over. He lacked the ability to develop new sales channels, and once the season was over, the goods became even harder to sell.
The secretary concluded definitively: "Trying to do business in a market economy with a planned economy mindset is bound to lead to losses!"
The counselor wholeheartedly agreed and instructed his subordinate: "When issuing the notification, be sure to emphasize that Russia today is not the Russia of the Soviet era. The pace of business is very fast, so let them be mentally prepared and not view the new situation with old mindsets. Otherwise, they'll suffer huge losses and have nowhere to cry."
The subordinate smiled and nodded in agreement, then subconsciously quipped, "This is really the opposite of what we're supposed to do. The state-owned factory should be handling this themselves, but it turns out that a private business owner is taking the lead first."
It's kind of ridiculous to think about.
The counselor took a big gulp of tea, let out a long sigh, and said meaningfully, "Just wait and see, there will be many more instances of private enterprises forcing state-owned enterprises to back down. Today's private business owners are quite different from those of the past."
"In the 1980s, if you were a boss and had the guts to avoid being hit, you could make money. Even if you were illiterate, you could become a millionaire or even a household with tens of thousands of yuan."
"The old ways don't work anymore. These days, those who take unpaid leave to become bosses are all knowledgeable, cultured, intelligent, and well-connected. When they start doing business, state-owned enterprises may not be able to compete with them."
The counselor glanced at the Moscow sky outside the window, and a moment of confusion also arose in his heart.
I really don't know which way the clouds in the sky will drift.
If private enterprises become better than state-owned enterprises, is socialism still socialism?
But if we don't allow the development of private enterprises, will China become the next Soviet Union and fall apart?
Reforming is indeed like crossing a river by feeling for stones; nobody knows what the next step will be.
He composed himself and said, "Alright, let's try to make it a big success and get this large-scale trade fair up and running in September."
The newly assigned administrative assistant, who had been holding back for a while, finally mustered up the courage to ask, "Is it appropriate to hold an exhibition and trade fair in September? I think the situation in Moscow is quite tense right now."
There was a bloody conflict in May, and then the parliament and the president were arguing fiercely.
On July 27, the president ordered the dismissal of his closest aide, the Secretary of National Security.
Frankly, the young administrative assistants all felt it was only natural that the country would immediately fall into war.
As a result, the veterans who had been in Moscow for many years all laughed.
"It's alright," the secretary reassured him with a smile. "Even if a real fight breaks out, it won't stop everyone from doing what they're supposed to do. You don't understand Russians. Moscow has a population of 10 million. Even if 20,000 people are fighting each other in Red Square, it won't stop the remaining 9.98 million people from going shopping in the nearby stores."
This is Moscow, the amazing Moscow.
Western media called this land the chaotic East, which attracted countless adventurous gold seekers.
The indigenous people living on this land have long been accustomed to living at their own pace in a de facto state of anarchy.
The Moscow government's policy of stopping the circulation of old rubles in the market can be considered effective in a sense.
Throughout August, the ruble's exchange rate remained at 1,000, no longer falling continuously every day.
Even the bank manager couldn't help but joke when he saw Wang Xiao and Ivanov: "Oh, it looks like we'll be able to recover $40 million, including principal and interest, by the end of January next year."
Ivanov's heart was bleeding, but he still forced a nonchalant expression: "That's really good news. After all, you know, no one wants the ruble to stabilize more than us merchants."
Then, he wanted to blow up the Kremlin.
Shit!
This time, Wang Xiao didn't even need to nag; he was already full of energy. Otherwise, if they couldn't even earn the extra interest when the loan matured, that would truly be infuriating.
Summer, damn summer, there's not a single piece of news to cheer me up this summer.
The battle between the president and Congress continues. On August 12, the president publicly stated that he would give his opponents a fiery September.
As for how popular it is, frankly, not many people care.
Everyone's tired of these verbal battles.
Rather than watching their verbal sparring, Wang Xiao was more interested in another news item in the newspaper: the infamous Galaxy incident.
The Galaxy incident is considered one of the three great shames of the 1990s.
Simply put, the United States believes that the Chinese ship carries prohibited chemicals and has requested an inspection.
China conducted its own inspection and confirmed that there were no issues, but the United States still demanded boarding and inspection.
And where is the Galaxy? On the high seas.
What gives you, the US, the right to demand boarding and inspection? This isn't your private territory.
Ivanov became excited as well, his eyes sparkling as he asked Wang Xiao, "Wang, you'll refuse, right?"
Ah, he always believed that the collapse of the Soviet Union was at least half an American conspiracy. And the vicious devaluation of the ruble was a scheme by the Americans to reap the wealth of the Soviet Union.
He no longer expects the Moscow government to take a tough stance against the United States; he's hoping China will slap the US in the face so he can vent his anger.
Wang Xiao was still angry, but after being stared at like that, he laughed in exasperation: "What are you thinking? Why would the United States dare to make such an unreasonable demand? Because the Soviet Union is gone, and the Moscow government is a good-for-nothing good-for-nothing!"
Ivanov looked disappointed: "So, you won't refuse?"
"Of course!" Wang Xiao retorted irritably. "Where are we supposed to refuse? Who can stand up to the US right now? If the Soviet Union were still around, do you think the Americans would dare to do that?"
Ivanov couldn't hold back any longer: "Didn't you guys also fight in the Korean War back then? Where's your courage?"
Wang Xiao slammed the newspaper down in his hand and looked at him seriously: "Ivanov, there's something I really don't understand. Why don't you counterfeit US dollars? Look, when the Soviet Union collapsed, you said it was because of a lack of foreign exchange, so the economy collapsed and the country couldn't support itself. Now the Russian economy is not doing well because the ruble is depreciating rapidly, and some people are taking advantage of this to reap the wealth left by the Soviet Union. The problem lies with the US dollar."
Why don't you counterfeit US dollars?
"Just like when Germany counterfeited pounds during World War II."
"Financial warfare is still warfare!"
"I believe that with your technology, you can definitely make a fake that is indistinguishable from the real thing."
Ivanov hesitated, stammering, "Because...because we have principles."
Wang Xiao responded with a cold laugh, then picked up the newspaper again.
Ivanov awkwardly tried to make conversation: "Hey, Your Majesty, our shipments this month are fantastic, already three times that of the same period last year."
Wang Xiao was speechless and didn't want to look at him at all: "That's because last month, wholesalers placed orders with us using a large amount of old rubles."
Haha, we need to discuss this further: what does it mean when the ruble exchange rate returns from 2000 to 1000?
Ivanov touched his nose and smoothly skipped the topic: "Hey, Your Majesty, our fleece products are moving really fast, they'll be ready to ship soon."
He thought his partner would be excited and would enthusiastically discuss the bright future of fleece with him.
Wang Xiao didn't even look up: "Isn't this the right thing to do? It's almost September, if we don't ship now, are we going to wait until next year?"
Ivanov silently withdrew his exaggeratedly enthusiastic smile and racked his brains again: "Hey! Wang, everything is going smoothly at our container market. The cement ground has been laid, the rain shelters have been erected, and the container houses will be in place soon. I contacted the military, and they agreed to patrol the site."
He learned this at the Zhimen Market, where local air force units patrolled regularly, effectively ensuring public order.
He originally wanted the police station to come in, but the police station had too many problems and not enough officers.
He happened to find some young men from the paratrooper unit to help organize the market; they didn't ask for wages.
There are too many troops in Moscow now, and the young paratroopers are willing to work as long as they have cigarettes and food.
Yes, cigarettes are a form of hard currency right now.
So after he expressed his concerns about security in the market, he reached a pleasant agreement with the military to have them patrol the market and help maintain order.
After he finished rambling on, Wang Xiao finally looked up at him and earnestly asked, "Is it the Mafia?"
Ivanov's eyes widened first, then he covered them with his hands and murmured, "Oh God, why are you always so perceptive?"
“You could have guessed it.” Wang Xiao flipped through the newspaper in his hand. “There’s a free market outside the subway station, and the mafia is bound to be collecting protection money there. If we set up a container market there, they’d be crazy not to want a piece of the pie.”
Ivanov laughed and pointed to his own teeth: "Unfortunately, their teeth are still too soft."
How can they survive if anyone can take a piece of their flesh?
In the dark world, big fish eat small fish, and small fish eat shrimp.
He laughed for a while, then suddenly felt very lonely: "Your Majesty, why aren't you laughing?"
Wang Xiao continued flipping through the newspaper, her voice light and airy: "I don't find anything funny."
Ivanov emphasized one thing: "What about that trade fair? The venue is all arranged now, and the exhibitors have all been confirmed."
My God!
Everything was progressing so smoothly.
Renting a venue is not a big problem; Moscow had a large exhibition hall showcasing the achievements of national construction during the Soviet era.
Now, nobody cares about its construction anymore; all the exhibition halls have been rented out.
Nobody cares what you exhibit inside, as long as you're willing to pay.
What truly surprised Ivanov was the enthusiasm of the Chinese manufacturers.
They were nothing like the slow-moving state-owned factories under the planned economy that he had imagined; each one reacted quickly and their attitude towards cooperation was extremely enthusiastic.
International faxes kept coming in, and everyone was eager to get started.
Aha! Looking at the confirmation letter for participating in the exhibition, he was absolutely certain that their container space rental would go very smoothly.
However, his enthusiastic description of the blueprint did not impress Wang Xiao.
The latter remained expressionless: "Isn't this how it should be? If you want to make money, you can't expect people to hand it to you."
She tapped the newspaper twice with her pen, reached for the telephone, and started making an international call.
The phone rang for a full half minute before someone ran over to answer it. Then it was passed from one person to another, and by the time Tang Yicheng finally came to answer the phone, three minutes had passed.
He was panting heavily as he explained, "I'm being harassed to death."
After the Spring Festival, following Wang Xiao's arrangement, he set off for Hong Kong to invest in real estate.
Acquiring land is too troublesome; even if he's an outsider, he'll have a hard time dealing with local bullies.
So he simply bought a house, buying it all at once, and there were discounts for buying more.
Even so, it still made him shudder: "Houses in Hong Kong are practically built of gold bricks, with prices exceeding ten thousand per square meter."
Wang Xiao laughed and said, "That's normal. Moscow's housing prices are crazy right now. But let's not talk about that. What's the situation in Suifenhe these days?"
Tang Yicheng sighed heavily: "I shouldn't have come back. I would have preferred to fight to the death in Hong Kong!"
Nothing good will come of it when you come back.
Suifenhe was bustling with activity in the first half of the year, but the wind suddenly turned sour this summer.
In June, when the Premier's 13 measures were released, everything was doomed; banks tightened credit.
This move had far-reaching consequences; Suifenhe, no, the entire border trade sector, instantly fell into disarray.
Tang Yicheng, worried that his boss might not understand the intricacies of the situation, explained, "Many people involved in border trade here rely on bank loans. The Russians' contract fulfillment rate is already low, and now with domestic credit tightening, we're even more vulnerable. Plus, the real estate market was driven by credit speculation, and the government is clearly trying to control infrastructure investment, just like in 1989. The Russians' barter exports mainly consist of—"
The sound of turning pages came through the microphone; he was clearly looking at his notebook.
“One is construction steel, such as angle steel, channel steel, rebar and wire rod; another is construction machinery, such as bulldozers, excavators and loaders; another is transportation machinery, such as Kamaz trucks, Kraz trucks and cars; and the third is steel raw materials, such as old heavy rails and scrap steel.”
"These types of products are all used in the construction market in China. When infrastructure construction contracts, demand drops sharply, and prices will inevitably plummet."
"Even if the Russians can fulfill their obligations, it won't matter. Because the domestic market doesn't need that much. The goods are piling up in the hands of the importers in China, and they lose money every day they're left there."
Wang Xiao hummed in agreement: "So you mean there's no need to defend Suifenhe anymore?"
"That's right!" Tang Yicheng said decisively. "There's a big problem here. Due to historical reasons, the mentality of rebuilding after the war is too strong, and we don't have our own industry. So even if border trade is booming, it's not really booming here; we're just getting a free ride."
Look at the construction sites in Suifenhe; he estimates that more and more will stop work in the second half of the year.
Surprisingly, the trajectory of its rise and fall is quite similar to that of the unfinished buildings at Tianya Haijiao in Hainan.
They truly are brothers in misfortune, one in the south and one in the north.
Wang Xiao nodded: "I also think this border trade is doomed. Perfect, I'll assign you a new job."
Tang Yicheng was overjoyed: "Buy land in Hong Kong? I think if we keep trying, there's still hope."
He had a bad experience buying land in Hong Kong and was still not convinced, so he wanted to try again.
“No.” Wang Xiao interrupted his fantasy. “You’ll buy up any unsold Kamaz and Kraz trucks you can get your hands on.”
Previously, trucks traded between the two countries were in high demand, especially Kamaz trucks, which were very sought after.
Kamaz Automobile Plant is located in the Russian Tatarstan Autonomous Republic and consists of casting, forging, chassis, diesel engine, assembly, repair and tool manufacturing plants, as well as auxiliary factories.
The equipment in the foundry and forging plant, the computer-controlled assembly line in the assembly and repair plant, and the computerized assembly line system for the entire plant were provided by more than 80 American companies.
France designed the diesel engine plant and provided all the equipment.
West Germany designed the transmission machinery for the entire automobile plant, providing 1,200 machine tools and linkages, as well as a 12,500-ton stamping press for the foundry.
Italy supplies tires, rubber, and conveyor equipment to car factories.
Japan provided a batch of forging presses, six automated production lines for automotive parts pressing, and experimental machinery for transmissions.
Britain exported paint spraying equipment and computer control systems to it.
In addition to these established capitalist countries, Eastern European countries also provided some equipment.
Without a doubt, Kamaz trucks of this era were a veritable world exposition, boasting world-leading technology. (Note ①)
Wang Xiao and Ivanov visited the factory and found that the workshop was indeed modern, the workers were top-notch, and the production efficiency was quite high.
Unfortunately, on April 14th of this year, the heart of the Kamaz automobile plant—the diesel engine plant—was hit by a severe fire that burned for dozens of hours, turning the entire factory into ruins.
Since then, the Kamaz plant has been racking its brains to restore normal production capacity.
Tang Yicheng was taken aback: "Why are you taking this? We already have enough trucks. With infrastructure construction halted, we don't need that many trucks to transport building materials at all."
He had also heard about the fire at the Kamaz automobile factory, and he personally tended to believe that it was caused by the Tatar Republic's attempt to gain independence, not by an accident, but by human intervention.
But this has little to do with them.
"No, we need a lot of trucks."
Wang Xiao explained, "The industrial system in the ruble zone was completely destroyed by the abolition of the old ruble. We set up a container market in Moscow and needed a lot of trucks to transport goods for our tenants."
Tang Yicheng was stunned for a moment, then blurted out a silly question: "Going to Moscow to deliver goods?"
Wang Xiao felt a sudden tightness in her chest and struggled to breathe to calm herself.
"No, it's about transporting the goods through the port to Russia. Sea freight is too slow now, international trains have limited railcars, and airplanes can't carry containers, so it's all loose cargo. We have to use trucks for road transport to make up for it."
Tang Yicheng was taken aback: "So we need to form a car team?"
Good heavens! They're not content with just air freight, they're even bringing in road transport now.
So, do they have to build a commercial city at the border as well?
“It’s not impossible,” Wang Xiao said clearly. “Although trade conflicts are escalating, the demand for trade has not disappeared; in fact, it will increase. When others retreat, it’s the perfect time for us to advance. If you have capable people under you, then get it started.”
Historically, Suifenhe's status as a border trade hub declined sharply. The official explanation was primarily due to the merging of China's dual-track exchange rate system, which caused changes in the exchange rate of the Chinese yuan against the Swiss franc, leading to a significant increase in import tariffs and value-added tax. Other contributing factors included Russian restrictions on the types of exported products, changes in import and export tariffs, and restrictions on Chinese personnel entering the country.
But in Wang Xiao's view, the most crucial point is that Chinese goods have lost their reputation in the Far East market.
The rampant sale of inferior goods like "chicken feather coats" and "monthly shoes" has completely ruined the image of Chinese products.
The Russian people were no longer willing to be fooled, so the market naturally closed its doors.
But all of this is not irreversible.
Last year's large-scale crackdown on counterfeits in China, as well as the surprise crackdown in August this year, have effectively regulated the basic market environment.
The wholesale market that Tang Yicheng was in charge of in Suifenhe was not large in scale, but business was always good and it had a very good reputation.
This means that they have a solid foundation to continue expanding the scale of cross-border direct selling in the Far East.
Tang Yicheng was delighted, feeling a secret sense of satisfaction at being valued and trusted.
He immediately patted his chest and assured them, "No problem, there just happens to be a market here that I'd like to acquire."
Ha! If things continue like this, he's going to take charge of border trade as well.
————————
Note ①: Regarding the changes in the border trade situation in Suifenhe, the reference material is the article "The Causes, Consequences, and Implications of the 'Bubble Economy' in the Heilongjiang River Basin during the Sino-Russian Border Trade Wave" published in Volume 21, Issue 5 of the journal Siberian Studies in 1994, by Lin Heming.
Note ②: For information about the Kamaz automobile plant, please refer to the article "From Sakhalin Island to St. Petersburg - Russia as I Saw It" published in the 21st issue of International Outlook magazine in 1995, by Hong Fan.
Continue read on readnovelmtl.com
