RHI Magnesita looks to the future in China

1. How do you see the role of the Chinese market in your global layout?

RHI Magnesita is the leading global supplier of high-grade refractory products, systems and solutions that are critical for high-temperature processes exceeding 1,200°C in a wide range of industries, including steel, cement, non-ferrous metals and glass. With a vertically integrated value chain, from raw materials to refractory products and full performance-based solutions, RHI Magnesita serves customers around the world, with about 13,000 employees in 35 main production sites and more than 70 sales offices.

RHI Magnesita's size, global reach, and innovation helps us bring the best practices to China. For example, we can bring over 120,000 products from around the word to China. This helps us ensure that our clients receive a robust supply of product while being protected by quality security.

The China market is a critical strategic priority for RHI Magnesita. As the second-largest economy in the world, that continues its rapid evolution, we want to be part of China's strategy by promoting strong, sustainable, and balanced growth.

Our strategy is based on the concept that our customers are our partners – we focus on providing solutions to their extreme challenges. We have been listening to the unique needs of the Chinese market and responding to the constantly changing requirements.

Our track-record echoes our past commitment to and investment in China. With the merger between RHI and Magnesita in 2017, we reconfirmed this commitment to China and prioritized the country as a critical regional business unit in our global portfolio.

Investing in people in China is investing in our future. Our "China for China" strategy is a program designed to ensure we continue building a strong China team composed of both local and international experts.

Our R&D center in China is expanding fast, leveraging the best globally available technologies. We have already made significant progress to expand our product portfolio to meet the specific needs of the Chinese market. In addition, Chinese innovation, such as the work undertaken by our Shanghai Digitalization Hub, has been rolled out to our global system. Our strategy is not simply to be a passive recipient of innovation from other countries but an active exporter of innovation from China to the world.

2.The Chinese government has introduced a series of initiatives to optimize the business environment, including the Foreign Investment Law. What changes have you seen in China's business environment?

Since 2012, President Xi Jinping has been putting relentless efforts into improving China's business environment for both private and foreign organizations.  We very much appreciate this, are highly supportive of China's continued work to open its market and impressed by the recently updated draft of the foreign investment law released in 2019.

Positive changes to the business environment in China are important to RHI Magnesita because it means that we find it easier to invest in and do business in the world's second-largest economy. RHI Magnesita has benefited from this improvement and as a result has been recognized as the first and only WOFE in China with our own mine in Chizhou, Anhui province.

China's strategy to build a stable, fair, transparent, and predictable business environment will not only unleash the enormous potential of businesses in China but also will continue to create value to the world. The commitments to improve the business environment will provide a long-term driver for China, allowing it to transform the economy, drive high-quality development, and support the country through changes not seen in a century.

3.What are the biggest achievements China has made since the introduction of the reform and opening-up policy 40 years ago?

The changes have been vast and significant. The pace, direction, and creation of value have truly been incredible. Over the last 40 years, China has grown to become the world's second-largest economy and the engine for global economic recovery and growth. China has emerged as a driving force for worldwide change, created opportunities for innovation, enabled enterprises to thrive, and generally been a significant contributor to global economic development.

1.The country's economy expanded at an average rate of 9.5 percent over the last 40 years, far beyond the world economy's 2.9 percent in the same period.

2. The per-capita GDP has grown exponentially to be over $10,000 in 2019. About 30 percent of world economic growth is attributed to China's contribution since 2015, compared with 3.1 percent in 1978.

3. Crude steel output grew from 31.78 million tons in 1978 to 1,05 million tons in 2020.

These figures mark the incredible achievements China and its people have achieved in less than half a decade.

This year is the first year of China's 14th Five-Year Plan and marks a new development stage of China transitioning from high-speed model to high-quality model, which underscores China's focus on innovation, further opening and sustainability. We are very confident that China will be one of the leading economies for many years to come and will play a more important and active role in economic globalization, though we are facing a new global reality engraved by a new geopolitical order with the emergence of China as a global leader, a more difficult trade landscape and frequently changing rules pressures and a much heated-up Climate Action agenda in all regions of the world

4.In response to the pandemic last year, what strategy did you make and what measures did you take to secure the production and mitigate the impact on corporate development?

With the breakout of the pandemic, it was clear that we were all in this together. The pandemic caught everyone around the world off-guard and our first priority was for the safety of our more than 2,000 employees in China.

We quickly aligned with the impressive fast decisive actions of the Chinese government, which allowed us to adapt our working practices to minimize the impact. As a result of our quick action and leadership none of our employees in China were affected by COVID-19 and colleagues from around the world started to look to us for advice and best practices in responding to the crisis.

An emergency demands good, stable, and trusted leadership. After the breakout of COVID-19 in early 2020, I quickly set up a crisis management team that kept close contact with key stakeholders, such as employees, the HQ in Austria, local governments and with customers.

As a result of this quick inclusive work the company was able to keep production operating at an almost normal pace by responding to new working conditions and new ways of working, all while ensuring the provision of good service to customers while maintaining the safely of all employees.

A disaster can provide an opportunity to support others. I wanted to quickly send out a signal to stakeholders that reflected the core values of RHI Magnesita and right at the very beginning of the lock-down had the company donate 1 million yuan($154,600) to Wuhan to support local needs.

The crisis provided an opportunity to rapidly change the way RHI Magnesita worked. To meet the new and pressing challenges imposed by the crisis, the organization accelerated its plans for regionalization, digitalization and automation as it endeavored to provide business continuity. We leveraged our Global Digitalization and Automation Hub in Shanghai as a pilot to lead the operations digital transformation, established better internet infrastructure, and hired talented Chinese employees to support the change.

5.What and how will RHI Magnesita do to reinforce the sustainability and finally realize carbon neutralization?

Chinese President Xi Jinping has announced an ambitious climate target to achieve carbon neutrality by 2060, which is expected to accelerate the world's transition to green and low-carbon development

RHI Magnesita is a partner with China in helping to shape a sustainable future. As a global leader, we are part of the worldwide effort to create a better future for humanity. As such, we are committed to undertaking initiatives to address climate change while promoting sustainable growth in a low-carbon and resource-constrained economy.

Sustainability is not about talk, it is about action. RHI Magnesita already set clear targets and plans to lead the green transformation in the refractory industry. We will invest globally more than 50 million euros in technology research and pilot plant construction in the next four years, including new technology for the capture and utilization of CO2.

In China, we are improving technologies and processes to increase energy efficiency and decrease carbon emissions. In the Dalian plant, we will finish the construction of the CO2 capturing facilities and start trials within 2021. In addition, we have developed a broad portfolio of products to help our customers achieve energy saving and emission reductions.

We believe that together with our increasing investment and implementation of advanced technologies, RHI Magnesita can facilitate and contribute to the goal of carbon neutralization of China by 2060.

6.2021 will mark the 50th anniversary of the diplomatic relationship between Austria and China. At this precious moment, can you please share your outlook/wish/expectation for economic cooperation and development between these two countries in the future?

Since the establishment of diplomatic relations between China and Austria in 1971, cooperation has developed between the two countries in a wide range of fields. By 2020, China had become the second-largest trading partner of Austria.

After the outbreak of COVID-19, China and Austria have worked together and helped each other in times of difficulty, deepening and developing the friendly strategic partnership between the two countries.

I believe the traditional friendship between China and Austria will only get stronger in the future. Furthermore, there is huge potential for cooperation and strong economic complementarity of both countries in the areas of economy and trade, technology, environmental protection and the BRI, etc, to achieve mutual benefits.

As mentioned before, RHI Magnesita has a clear strategy and plans for further development in China. We are positive that our investments and elaborate initiatives will aid in China's continued development and help us to succeed in the China market: A win-win for all.

2021 is also the 100th anniversary of the founding of the CPC. I hereby wish China and the Chinese people a strong, rich, and prosperous future under the leadership of the CPC.