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Catholic businesses weather the financial storm

Bad investments drive many to bankruptcy

Catholic businesses weather the financial storm
A worker removes materials from a business that filed for bankruptcy in Wenzhou last year (photo courtesy of Xinhua) reporter, Wenzhou

February 1, 2012

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The recent demise of a major manufacturer in Wenzhou, Zhejiang province, was spectacular. But it is only one in an epidemic of bankruptcies and closures that are currently ravaging the city. The chairman of Central Group, China’s largest maker of eye glasses, fled in secret to the USA last September, leaving behind a debt of 1.5 billion yuan (US$237 million). He is not the only one to escape from this city, which was previously seen as a showcase for China’s commercial boom. It is estimated that more than 200 entrepreneurs have run away to evade debts, while about 25,000 companies gave gone bankrupt in the last nine months. The crisis spread so rapidly and alarmingly, China’s Premier Wen Jiabao felt it necessary to visit Wenzhou in October, in an attempt to calm nerves. But while he may have had a soothing effect, he has by no means eradicated the two root causes of the problem. Unable to raise finance from the major banks, many small and medium enterprises have taken private loans at extortionate interest rates, which they cannot now repay; and many of the fleeing entrepreneurs, perhaps infected by a gold rush mentality, invested rashly and, as it turns out, unwisely in real estate, stocks and futures. However, Catholic businesses in the city have remained relatively unscathed. Father Paul Jiang Sunian, who runs Wenzhou diocese’s Association of Catholic Enterprises, claims that their members have not been affected. “It’s awful that some of my business friends who run successful enterprises have now disappeared,” said one Catholic businessman, identified only as Joseph. “I warned them before not to get involved in usury,” he said. “My Catholic faith has guided me never to seek excessive profits. Jesus’s teaching seems to influence Catholic entrepreneurs imperceptibly, even in the competitive business environment.” Joseph and his wife bring their faith to their business by  inviting their employees to spend Sundays with them, a common practice among Catholic employers. Some larger enterprises even build their own chapels for their staff to pray and rest. Anthony, whose enterprise plans to go public in Shanghai, said he has instilled a Christian spirit into every department and every heart of his workforce of around 1,000. “It helps them to keep a calm and peaceful mind,” he said. At their recent annual meeting, Anthony and some of his workers quoted Bible verses to share their thoughts. Then hundreds of people prayed together, sang hymns and held hands. Even though most of the participants were non-Catholics, one worker at the meeting said, “I like this kind of prayer, as it helps to release a great deal of work pressure.” Another said, “I gain not only material wealth but also spiritual values here, which is a precious experience in my life.” Many Catholics believe that the current rash of departures and defaults in Wenzhou is a direct result of the profit-oriented business culture that has been in force since China started its reform and open-door policy 33 years ago. Paul, a manager at Anthony’s company said,  “a major cause of this fleeing tide is some impetuous entrepreneurs’ blind pursuit of self-interest.” “All enterprises should be aware of their social responsibility and be human-oriented. Catholic entrepreneurs can achieve this human-oriented management by having a footing in the Christian faith,” he said. “That’s why they are surviving this economic storm.” Related reports Intellectuals ‘must play greater role’ Catholic entrepreneurs seek work-life balance Catholics deal with effects of inflation

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