Yunnan Natural Gas Chemical Group
              in Pursuit of New Developments
    -Interview with Chairman of the Board Li Xinhua
                      Chen Shibin
Yunnan Natural Gas Chemical Group Co., Ltd. grew out  of
        Yunnan Natural Gas Chemical Plant.  The  plant  was
one of the key large chemical  enterprises  in  China  and
also  one  of  the  13  large  chemical  fertilizer  units
imported in the early 70's. Its  major  products  included
urea, ammonium nitrate, methanol,  formaldehyde  and  urea
-formaldehyde (See Table 1).
  Table 1 Major Products of Yunnan Natural Gas Chemical Group Co. Ltd.
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Product                 Capacity(`000t/a)               Time to start production
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Ammonia                         300                             October 1997
Urea                                    480                             October 1977
Nitric acid                     80                              December 1980
Ammonium nitrate                110                             December 1980
Woven bag(`000 pcs)     15 000                  1984
Methanol                                30                              1996
Formaldehyde                    66                              1996
Urea-formaldehyde               30                              1996
Pentaerythritol                 10                              March 1999
Sodium formate          7                               March 1999
Polyformaldehyde                10                              March 2000      
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In  March  1997  the  plant  was  changed  into  a  limited
liability company wholly owned by the state and  with  the
operation right granted by Yunnan  Provincial  Government.
In June Yunnan Natural Gas Chemical Group Co.,  Ltd.   was
established by self-funding and public placement. In  July
100 million "Yuntianhua" A shares were issued in  Shanghai
Stock Exchange. The group has a total asset value of over 2.
7 billion yuan, a net asset value of over 2.2 billion  yuan
and an assets-liabilities ratio of 26.63%.
Table  2  shows  the  performance  of  Yunnan  Natural  Gas
Chemical Group Co., Ltd. in the recent years.
The rapid development  and  excellent  performance  of  the
group in the recent years have aroused a general interest.
The reporter of CCR(R) has  therefore  made  an  interview
with Li Xinhua(L), Chairman of the Board of Directors.
R: As a well-known domestic chemical fertilizer enterprise,
the performance of Yunnan Natural Gas Chemical Group Co. ,
Ltd. is getting better and the reputation is also  getting
higher after it was listed in the stock market. How do you
feel about it?
L: First of all,  the  restructuring  and  listing  of  the
  enterprise  can  promote  the   transformation   of   the
  operational  mechanism  in  the   enterprise.     Through
restructuring and listing, the enterprise has freed itself
from the shackles of the old system and  is  now  full  of
vigor and vitality. The enterprise will function  strictly
according to the requirements defined  in  the  "Corporate
Law" and gradually establish the modern enterprise system.
Without doubt, it is  an  effective  way  of  revitalizing
state-owned enterprises. Secondly, the  restructuring  and
listing of the enterprise can promote  the  transformation
of employees' ideas.  The  transformation  of  op