At 0:00 on December 1, 2009, the Luosi Bay Wholesale Market moved out of the old Luosi Bay, and the new Luosi Bay International Trade City officially set sail.
From 2014 to 2017, Zhonghao Group was in business crisis and its capital chain was broken. Villagers could not return home, citizens could not buy houses, and merchants could not sustain their operations. Stability maintenance became a major problem, forming a serious systemic financial crisis. risk.
Before the reorganization, the basic situation of Zhonghao Group: total liabilities of 33.8 billion, including: 17.6 billion in principal from financial institutions, 2.4 billion in interest arrears, 5.2 billion in principal and interest of entrusted loans, 2.1 billion in project funds, and 6.2 billion in fees. 5.2 billion in advance rent and house purchase payments, 100 million in rent repayments from the food city, and 580 million in other payments. A loss of 9.2 billion yuan.
(1) Social stability maintenance issues
The resettlement houses in Tami Village could not be delivered. About 1,625 households with 4,500 people who were demolished have not been able to move back for nine years. They have been wandering outside for a long time. This has happened to nearly 100 people. Sub-large-scale rights protection; 12,000 owners of 3,303 households in Youhuo City have not been able to return home for three years.
The vast majority of merchants in the International Trade City have no intention of operating. Once more than 100,000 merchants go bankrupt, all their investments will be lost, and a huge mass incident will occur.
(2) Systemic financial risk
As of December 31, 2017, Zhonghao Group owed financial institutions RMB 17.6 billion in principal and RMB 2.8 billion in interest. Banks entrusted loans with principal and interest. 3.5 billion yuan, totaling 23.9 billion yuan.
All properties on the market have been fully mortgaged, some properties have entered the judicial auction process, and some have entered the asset management company to prepare for auction, and are also involved in litigation cases. There were also criminal cases such as the Li Jinsong fraud case, involving a total amount of 1.83 billion yuan. Many financial institutions were involved in financial risks. The seized 35.6% equity of Zhonghao Real Estate could not be unsealed in time, and the debt risks of Zhonghao Group could not be solved. If it is resolved, it will cause extremely serious systemic financial risks to the financial market in Yunnan Province.
(3) The issue of long-term arrears in taxes and fees
As of 2017, Zhonghao Group had accumulated arrears of approximately 500 million yuan in taxes and 620 million yuan in arrears.
(4) Litigation Disputes
1. Among the issues left over from the original Zhonghao, litigation disputes have always hindered the normal reorganization work due to the large number of cases involved, the long time span and the diversity of the cases. The total number of cases reached 2,395 and the amount involved reached 4.35 billion yuan, triggering a large number of social disputes and intensifying social contradictions.
2. Creditors and financial institutions have seized a total of 1.8 million square meters of shops in the first and second phases of Luosiwan and the Chinese medicinal materials market. Among them, more than 700,000 square meters of shops have entered the execution and auction procedures, which has affected the overall market. , continuing operations poses great risks. If it is not resolved properly in time, it will directly lead to the displacement of thousands of businesses and tens of thousands of employed people.
(5) The market operating environment is poor, supporting facilities are shut down, and merchants lose confidence.
Due to Zhonghao’s poor management and disorder, the market environment is poor and merchants lose confidence. A large number of fire-fighting facilities are out of service, posing major fire hazards; most of the more than 300 toilets have no access to water and electricity, are dirty and smelly, and the business environment is extremely bad. The business operations of the second and fourth phases are particularly dismal, with vacancy rates as high as 50% . The area's supporting facilities are seriously lagging behind, public facilities have basically stopped working, and educational resources are especially scarce.
Zhonghao Group’s operating crisis and broken capital chain have triggered a series of problems such as people’s livelihood, social stability maintenance, financial risks, litigation risks and lack of supporting facilities in the area. Since 2015, many provincial and non-local enterprises have not been successfully reorganized, and Zhonghao’s historical issues need to be resolved urgently.
In November 2017, Junfa acquired Zhonghao Luosiwan with a debt of 45.2 billion. As of September 30, 2020, it had invested 14.6 billion of its own funds, undertaken bank loans of 20.4 billion in principal and interest, and entrusted loans of 32 100 million.
In the past three years, Junfa has worked hard to effectively solve problems such as people's livelihood, social stability maintenance, financial risks, litigation risks, poor operating environment and lack of supporting facilities in the area, and has achieved initial results.
(1) Solve the problem of maintaining people’s livelihood and stability
In October 2018, Youhuo City officially handed over the houses, and 12,000 owners of 3,303 households officially returned home; the relocated houses in Tami Village were completed in December 2019 Officially handed over, about 1,625 relocated households ended their nine-year wandering.
A total of 2.1 billion yuan has been paid to nearly 400 construction units in advance.
(2) How to resolve systemic financial risks
After the restructuring, Junfa reached consensus on debt restructuring with 21 financial institutions including Minsheng Bank, Cinda Asset, and Industrial and Commercial Bank of China. opinions and sign relevant agreements. As of September 2020, a total of 5.9 billion yuan has been paid to the principal of loans from financial institutions, 2.4 billion yuan in arrears of interest, and 2.5 billion yuan in normal interest payments to financial institutions, for a total of 10.8 billion yuan.
As of October 31, 2020, there is still a loan balance of 13.8 billion yuan. In 2021, principal and interest need to be repaid of 7.1 billion yuan, in 2022, principal and interest need to be repaid, 4.4 billion yuan, and in 2023, principal and interest need to be repaid 2.3 billion yuan.
(3) Solve the problem of long-term arrears of taxes and fees
Since the reorganization, no new tax arrears have been incurred. As of September 2020, all 500 million yuan in arrears in taxes have been paid. .
Originally owed 620 million yuan in fees, 418 million yuan has been paid in strict accordance with the requirements of the municipal government's reorganization meeting.
(4) Handling litigation disputes
Since Junfa Group established Junao Company to reorganize Zhonghao Group in 2017, it has been committed to solving the litigation disputes left by the original Zhonghao Group; As of October 2020, there have been 2,395 litigation disputes caused by Yuan Zhonghao, involving an amount of approximately 4.35 billion yuan. Junfa Group has resolved 1,781 cases in an active and appropriate manner, with the amount of settled cases involving 4.182 billion yuan, and 614 cases are under continuous coordination During processing, the amount involved is 168 million yuan.
(5) Solving the problems of poor market operating environment and lagging supporting facilities
After the reorganization, Junfa invested 126 million yuan to improve and transform the facilities as a whole, improving the market environment and area facilities. greatly improved. Among them, 25 million yuan will be spent to complete the upgrade and renovation of fire protection facilities and toilets in the first phase of the market; 40 million yuan will be invested to renovate the fourth floors of areas A-D of the first phase market; 61 million yuan will be invested to renovate the atrium, and 80 million yuan will be invested to renovate the facade and outer square of the first phase market .
After the reorganization, Junfa quickly promoted the resumption of school construction and invested nearly 200 million yuan in the construction and delivery of Beijing No. 80 Middle School. At the same time, it invested 350 million yuan to accelerate the construction and delivery of the primary school attached to the Teachers College. In the future, 2 primary schools, 4 kindergartens, 1 top-grade hospital and other supporting facilities will be built.
Since the reorganization of Zhonghao in November 2017, Junfa has invested a lot of financial, material and manpower, and through hard work, has solved problems such as people's livelihood, stability maintenance, finance, litigation, merchant operating environment, and supporting facilities in Luosi Bay. Solve and present a new picture.
Junfa has the confidence, determination and ability to build the New Luosi Bay International Trade City into a modern wholesale, new retail and shopping park by relying on the digital + Internet trading platform and urban life facilities. An international-level urban complex project, it will also be built into a historical and cultural exhibition area for Yunnan merchants, the Yunnan-Vietnam Railway, and the Tea Horse Road.
(1) National market procurement and trade mode pilot to help domestic products export abroad
Yunnan is located in the core area facing the radiation center of South Asia and Southeast Asia. It has become the "capital" of ASEAN. As a strategic core point, It will definitely become the focus of South Asia, Southeast Asia and even the world, linking the import and export exchanges between ASEAN and China.
Data shows that merchants in Yunnan Junfa New Luosi Bay International Trade City have already had trade relationships with many South and Southeast Asian countries. In order to further accelerate the pace of its external sales expansion, Junfa will vigorously develop a digital online trading platform to help merchants conduct trade development with these countries more conveniently and quickly.
On September 15, 2020, seven ministries and commissions of the country jointly issued the "Letter from the Development and Reform Commission of the Ministry of Commerce, the Ministry of Finance, the General Administration of Customs, the State Administration of Taxation, the State Administration for Market Regulation, and the Foreign Exchange Administration on accelerating the pilot work of market procurement trade methods" [Commerce and Trade] Letter (2020) No. 425] officially approved Kunming Junfa·Xinluosiwan International Trade City as the fifth batch of pilot market procurement trade methods in the country.
On October 29, Kunming Junfa·Xinluosiwan International Trade City's market procurement and trade pilot project completed the first trial of the "first order", becoming the "first ticket" transfer export business for the fifth batch of 17 market procurement and trade pilot cities across the country. Kunming has launched a new model of export facilitation.
The "first order" of the Kunming market procurement trade mode pilot was successful for the first time, realizing the first trial in key areas and key links of international trade. As an important carrier of new formats and new models of foreign trade, New Luosiwan International The Trade City relies on market procurement trade pilots to take merchants abroad and take advantage of the free trade zone to help cloud products and domestic products go global.
(2) The "Internet + commercial trade" composite business model helps Yunnan products export to Yunnan
As a national strategic hub city, Yunnan focuses on "green food, green energy, and health" Life destination" three business cards. At present, the medicinal materials market in the third phase of Xinluosi Bay has become the largest medicinal materials market in Yunnan. The market is full of precious medicinal materials and local products that are abundant in all parts of Yunnan Province.
With the support of the Yunnan policy, Junfa plans to adjust the existing traditional wholesale market into a modern commercial complex step by step to adapt to the future market direction of the new retail model as the core of development, and build " The new composite business model of "Internet + commercial trade" helps farmers or merchants promote the merchants' products to the Internet platform, achieving a multiple increase in merchant transaction volume, allowing merchants to enjoy the market dividends brought by the rapid development of Internet trade, and will also Establish an Internet transaction settlement platform, build a cross-border e-commerce industry incubation system, cross-border O2O bonded display and self-pickup models, cross-border e-commerce O2O new retail and other services to promote cloud products to go out of Yunnan, to the country and the world.
(3) Led the investment of RMB 100 million to establish the Junfa New Luosiwan Entrepreneurship and Entrepreneurship Fund to support entrepreneurship and innovation
In order to support the building of a moderately prosperous society in an all-round way and win the battle against poverty, we support "mass entrepreneurship among all people" "Innovation", Junfa Group is guided by the Thought on Socialism with Chinese Characteristics for a New Era, thoroughly implements the strategic deployment of the construction of the free trade pilot zone, takes institutional innovation as the core, and takes replicability and promotion as the basic requirements, boldly tries and boldly breaks out , independent reform, create a market-oriented, legalized, and international first-class market business environment, strive to create emerging service industries and cutting-edge consumer industry clusters, accelerate the formation of new momentum, and enhance new competitive advantages.
Junfa Group will join forces with financial institutions to lead an investment of 100 million yuan to establish Junfa New Luosiwan Mass Entrepreneurship Fund. It is planned to invest in and incubate a large number of smart transaction-related enterprises in the modern service industry and supply chain upgrades within five years to help New Luosi Bay build a smart transaction ecosystem. Focus on venture capital and equity investment in modern service industries and supply chain upgrades, intelligent transactions, Internet of Things and other related industries.
In addition to funds, it is also making efforts in various aspects such as equity cooperation and operating incubators. Entrepreneurs in business intelligence transaction-related fields are expected to receive start-up financial support, as well as product design and R&D guidance, strategy formulation and operational coaching, technology platforms and other entrepreneurial support services provided by Junfa Group.
By establishing funds, efforts will be made to reduce the costs of entrepreneurship and enterprise development, optimize the policy and financial service environment for innovative entrepreneurs, provide a development platform, fully promote technological innovation, and promote the development of the real economy.
(4) Spend 800 million to build a giant urban complex and shape the city’s business card
Junfa will also open a new commercial cluster of 160,000 to create a people’s park, style and business center for the citizens of Spring City. Street, an investment of 800 million has been invested in the upgrading and renovation plan to turn Luosi Bay into a shining business card of Southwest China.
Through the overall transformation of the area, it will fill the gap that previously lacked shopping, entertainment, hotels, and business functions in New Luosi Bay. At the same time, it will realize the historical reproduction of the Yunnan-Vietnam Railway, Yunnan merchants, and the Ancient Tea Horse Road, and bring the new area into the new area. Luosi Bay is built into an international-level urban complex integrating dining, drinking, entertainment, shopping and high-end hotels.
The future of Junfa New Luosiwan International Trade City will be based on Yunnan’s national strategic advantages, highlighting the project’s unique commercial power in Yunnan, the region and the country, and establishing an absolute international market position. Junfa will build the new Luosi Bay into "the new Luosi Bay of the world".