Rebirth of the 1980s: The Military Industry Empire

The price I discussed with my old friend Zelafi Kousse back then was $500,000, which was a very cheap price. According to the exchange rate in the 1980s, one US dollar could be exchanged for 1.49 RMB, which is only 700,000 to 800,000 RMB. It's a great deal to buy a used electroslag remelting steel equipment at this price!

However, this is only the official exchange rate and does not represent the real exchange rate.

Because the country implements foreign exchange controls, ordinary people cannot use the official exchange rate for exchange. By the late 1980s, the exchange rate on the black market was the real exchange rate.

As for what the real exchange rate is now, Qin Yang needs to calculate it carefully.

Secretary Song was a little unhappy.

This project was brought to Director Wang for approval by Director Dong, along with documents approved by Director Fang and Director Han. As Director Wang's secretary, Secretary Song certainly knew the funds spent on the purchase.

Fifty thousand US dollars, plus transportation costs, converted into RMB is only one million.

On this matter, he was indeed a little biased towards Zhu Guohua. In order to compensate Factory 960, even if Qin Yang proposed a compensation plan of two million, he could agree. But now, Qin Yang actually wants five million?

This is a bit of an overreach.

"Secretary Song, I wonder if you've heard an interesting story," Qin Yang said, knowing that Secretary Song was considering whether to turn against him because of the five million, so he quickly explained.

"What is it?"

"Our workers who went to Africa for support each carried a Forever brand bicycle back when they returned, and half of them were from Shanghai."

Zhu Guohua was immersed in the shock brought by the five million and had not yet reacted: Why is Qin Yang talking about these irrelevant things?

Secretary Song, however, seemed to have guessed something: "Exchange rate issue?"

"In our country, buying a Forever bicycle costs 150 yuan and requires a receipt. However, in Africa, it costs only 36 yuan in RMB. Therefore, the workers who returned by boat almost all had one bicycle per person when they returned home."

This is equivalent to using bicycles as anchors. Dividing 36 by 150 gives 0.24 times the official exchange rate to the actual exchange rate. This does not even consider the shipping cost from China to Africa, which would make it even lower, about 0.2 times.

In this case, the real exchange rate would be about 7.5.

The purchase of 500,000 US dollars, plus transportation costs, Qin Yang asking for five million RMB is not too much!

Although Factory 960 used foreign exchange converted at the official exchange rate to purchase this batch of goods, how much effort did Factory 960 spend on this equipment? It certainly cannot be given to Capital Steel Factory for free! Even if Capital Steel Factory wants to import equipment, it needs to spend effort to go through the process. Capital Steel Factory cannot take advantage of this.

It is only natural to ask for money according to the real exchange rate!

Thinking of this, Secretary Song felt relieved: "That's right, Capital Steel Factory should pay this money. Where is your factory director? Go, call your factory director here!"

Wang Jinlai had been lurking nearby. When he saw Secretary Song get out of the car, his heart almost jumped out of his chest. Fortunately, Zhu Guohua was indeed capable and persuaded Secretary Song to leave the equipment behind!

According to the original plan, as long as they could successfully manufacture the materials needed for the new heavy machine gun, they would be able to justifiably occupy this equipment!

But now, they are actually demanding five million, which is clearly extortion!

The factory leader has gone abroad for inspection and will not be back for some time. Now, only he can come out. When reporting to the factory leader, he will say that it was arranged by Secretary Song, and the factory leader will have to comply!

"Of course not," Qin Yang immediately denied: "Either give money or let us take the equipment away. If you give us an IOU, when will it be honored? Director Wang, you've done such a great job, what if you get promoted someday? Will other leaders of the steel factory recognize this IOU?"

Wang Jinlai frowned: "Engineer Qin, you're being too polite. I guarantee…"

"Secretary Song, you can see that we have made concessions, but they still want to play tricks. Let's take the equipment away."

"Wait!" Wang Jinlai quickly grabbed Qin Yang: "Engineer Qin, I'll suggest a plan, see if it works. Our factory doesn't have money, but our factory produces steel. How about we provide you with five million worth of steel?"

If it were a few years ago, Wang Jinlai would definitely be put in jail for doing this. The steel produced by the steel factory needs to be uniformly distributed by the state. The steel factory has no power to dispose of it. But now, the state is gradually decentralizing power. Taking Capital Steel Factory as an example, under the condition of ensuring the state quota, the steel produced in excess can be freely disposed of. Otherwise, it would be too difficult for some collective enterprises to purchase steel.

The current price is 550 yuan per ton. When the country implements the dual-track system in 1984, the price for providing to the state will still be at this price, and the price for providing to the market can be determined independently. As a result, the price of steel soared. In that year, the market price of steel doubled to 1100 yuan per ton, and by 1988, it rose to more than 2000 yuan per ton.

"This price can buy 10,000 tons of steel. Our Factory 960 makes guns, not ships. We don't need so much steel," Qin Yang frowned and shook his head.

"Engineer Qin, if you can't use it, use it slowly. You can always use it up in ten or eight years," Wang Jinlai said, "How about this, our factory will try to raise one million in cash for you, plus four million in steel? While Secretary Song is here, I, Wang Jinlai, will be bold and make a decision."

In fact, Wang Jinlai is now in a dilemma. Is it worth spending so much money? He is just an office director and has not reported to the other factory leaders, but he has agreed to the other party's conditions. Even if Capital Steel Factory produces millions of tons of steel annually, this amount of money is not a small amount. But now, what we are fighting for is this breath!

"Engineer Qin, you have to suffer a little bit. Your factory has a lot of open space. Stack the steel first, and it won't be too late to use it when you need it in the future," Secretary Song began to mediate.

"Okay, since Secretary Song has spoken, then we will accept it. This money must be credited to the account as soon as possible, and the steel must also be arranged for transportation as soon as possible! We will clear the money and goods, and there will be no more changes!"