South China Aluminum seeks transformation

Pingguo County is located in the southeast of Baise City, and is known as the “Southern Aluminum City”. More than 20 years ago, Deng Xiaoping once instructed that “Pingguo Aluminum should engage”, and the local aluminum industry began to develop and quickly became the richest county in Guangxi. The county established a stone statue for Deng Xiaoping, standing on the Denggong Mountain opposite the county government.

In recent years, the aluminum market has been sluggish. Under this situation, the aluminum industry has been where to go. Local officials in Pingguo County of Baise City have been very cautious when they talked about related topics.

In the crisis night of aluminum capital, he went to Pingguo County and entered a business hotel. First, he saw a metal ball with a diameter of about 1 meter in the center of the hall. The tray read "Flat Aluminum Group" with four gold characters. In the hotel room, Pingguo Aluminum's promotion manual was piled on the desk. The brand that hangs the most in the county is “Pingguo Aluminum wants to engage”. The aluminum mine has laid the deepest mark on this city.

26-year-old Pingguo girl Lu Lu (a pseudonym), after graduating from Northwest University for Nationalities, found work in Nanning, suspected Nanning congestion, back to a high school teaching. She told reporters that although Pingguo is a county, various urban infrastructures in the city are perfect and there is no traffic jam. "In the west, it is difficult to see a county with so many cafes."

Lu Lu said that Pingguo is the richest county in Guangxi and has more cultural and recreational activities. Many dance music training courses in the county towns, and civil servants and teachers have slightly higher wage levels than surrounding counties and cities.

She lives in the glass village below Pingguo County and her ancestors farm. More than a decade ago, with the rise of the aluminum industry, young people in the village entered the aluminum industry one after another. Many of them worked outside the country and returned to Pingguo.

Lu Lu’s father is a contractor of the Ping Aluminum Group, doing machine maintenance and earning more than 1,000 pensions each month after retirement. Lu Lu believes that this is already very good for a farmer.

For Pingguo’s aluminum industry, a civil servant born in Baise County, Baise, stressed that Pingguo’s own resources are mainly in good condition. There are many aluminum ore reserves, large ore bodies, high grade, shallow burial, and easy exploitation.

Li Yuchuan, director of the Aluminum Industry Bureau of Baise City, told this reporter that after more than 20 years of development, the aluminum industry has become the pillar of Pingguo County's economy. With a wealth of resources, Pingguo County has been reputed to be the “Financial First County in Guangxi” for nine consecutive years from 2004 to 2012.

However, the development of Pingguo Aluminum Industry is also insufficient. At present, the aluminum industry is still in an extensive development stage. The refined products only account for about 10% of the total aluminum product processing.

At the same time, like many mining cities, development is accompanied by environmental pollution and land expansion.

“The most obvious thing is the fruit trees.” Lu Lu told reporters that when he was a child, there were many fruits resembling wild guava in the village. The roadside was readily available, and longan and corn production were also high. And now that there are fewer and fewer fruit trees, many are no longer the result.

Pingguo is thriving with aluminum mines and is highly dependent on aluminum resources. In recent years, the industry has been sluggish, coupled with concerns about resource depletion and ecological concerns, and it has begun a difficult transition.

Difficult transformation In the Aluminum Industry Bureau, Li Yuchuan took out a “plan for the implementation of the Guangxi Baise Ecological Aluminum Industry Demonstration Base” approved by the National Development and Reform Commission. In this document, Baise plans to build an aluminum industry with a production value of RMB 100 billion to provide reference for the sustainable development of aluminum industry and transformation of mining cities.

In mid-July 2011, the National Development and Reform Commission reviewed and approved the Implementation Plan for the Baise Eco-aluminum Demonstration Base in Guangxi, and set up a Baise eco-aluminum demonstration base in Guangxi. The plan proposes to explore the use of mineral resources and the existing industrial base, increase supporting facilities and deep-processing enterprises, and carry out the exploration of the pilot demonstration of eco-aluminum industry, the sustainable development of resource-based cities, and the eradication of poverty in old districts.

However, the support at the national level does not alleviate the current difficulties facing Pingguo Aluminum. A director of China Aluminium Guangxi Branch told this reporter that this year the industry is in a sluggish state. At present, they have to lose about 2,000 yuan per ton of electrolytic aluminum.

According to legend of Li Yu, the main task of the municipal government of Baise now is to ensure that aluminum-related companies can produce and make profits. “According to the plan for the construction of an eco-aluminum demonstration base, the huge investment in upgrading equipment, technological innovation, etc., is currently unlikely, and companies simply cannot afford it.”

According to Li Yuchuan, electricity is very important to the development of the aluminum industry. Solving the problem of electricity is the most essential method for the Baise government to try to support the industry. During this year's ** period, Baise Mayor Zhou Jue decided to “six cents” for Baise when the Guangxi delegation spoke at a national conference. Li Yu Chuan told reporters that the six-point money consists of two parts, one part is that the high-energy-consuming enterprises use electricity to subsidize 4 cents, and the other part is the electricity price adjustment, which is 1 point, 8 cents and 9 cents, which together amounts to about 6 cents. The latter part belongs to the national grid level, and the local government has no decision power and can only request preferential treatment from the higher authorities. At present, in Pingguo, every unit of electricity is 5 cents 6 points. The unified pricing of the power grid is unlikely to reduce prices.

He revealed that in order to solve the urgent needs of enterprises in the past year, Baise City began to provide 4 cents of electricity subsidies for some aluminum-related enterprises, and invested about 1.3 billion for this purpose. This year, due to the huge financial pressure, the subsidy policy has been cancelled.

"We cannot say that the country does not have policy support. We can only say that some of our requests have not yet been answered." Li said so.

Pingguo County Governor Wei Zhengye once stated that there are two transitional roads before Pingguo. One is to extend the aluminum industry chain, increase the added value of aluminum, and increase economic efficiency. The other is to cultivate and build non-aluminum industries according to the national circular economy of new energy and new materials, and realize the second entrepreneurship of Pingguo Industry.

However, related investment promotion work is still a problem for Pingguo.