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Volume 1 100 Insider Trading

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    I believe that the first batch of people who did business on the eve of reform and opening up will have this feeling - a sound legal system has the benefits of a sound legal system, and an imperfect legal system has the benefits of an imperfect legal system.  A series of methods such as insider trading, kickbacks, bribery, etc. are almost incompetent under the current domestic system. However, in more developed Western societies, they will face very disgusting legal processing costs.  For example, in order to develop overseas markets or win orders, almost no large multinational company has not used methods prohibited by law. Among them, very large multinational companies such as defense contractors and energy companies have the most intense and dark methods.

    Bribery and kickbacks are common in arms purchase cases. Countries such as Saudi Arabia and India, which are relatively corrupt due to power, have a large amount of funds used for bribes in almost every arms transaction.

    ¡°In fact, at a time when the UK is already overwhelmed by internal investigations, the Al-Yamaha Arms Agreement has basically fallen into the hands of China.  And because of its low cost, the contract itself is quite profitable for China.  Taking Leopard A as an example, Shenghua and CATIC quoted a price of US$24 million to Saudi Arabia. Although Saudi Arabia did not raise any objection, in fact, the price was so outrageous.  XAC's own calculated cost price was only about RMB 40 million, which was US$5 million under the new exchange rate. Qi Yiming was bold enough to directly bid nearly five times the price.

    The first factor of the low cost of Chinese-made weapons is, of course, low labor costs. In an era when the common salary is about 100 yuan, this is not only beneficial to labor-intensive industries, but also has a certain impact on the aviation industry.  In addition, because most of the technologies and even some parts that cannot be produced by physical enterprises are provided by the Red Alert Base, the cost has been significantly reduced.  The initial technology research and development expenses are basically zero, so there is no problem of repayment.

    Multiple reasons ultimately led to seriously low weapons prices. Qi Yiming had no intention of disrupting the order of the international military products market. He simply compared prices horizontally with products from other countries. Therefore, it was reasonable to shout out for fighter jets, tanks, and missiles that cost four or five times the price.  bingo.

    XAC and Chengdu Aircraft are still produced in factories after all, such as the Thorn-2 Red Patriot missile, which basically comes from the Red Alert Base. If you don¡¯t count the mineral resources from Mongolia and the Soviet Union that are illegally mined across the border, there is basically no cost. A set  The US$105 million air defense system is basically all profit.

    Qi Yiming believes that the performance of these Chinese-made weapons is no worse than foreign ones, and the service will be more considerate because of his intervention, and there is no need to shout as low as possible in order to compete for the market in the future.  Of course, even in the future, such as the US$3.5 billion 12 Hongqi-9 air defense systems, the profit is actually quite high.  China's competitive advantages mainly lie in its national system and human resources.

    It is said that Leopard A¡¯s profit margin is close to 5 times, but Leopard B¡¯s profit margin is lower.  Because the Leopard B uses more advanced technologies for manufacturing, the difficulty of production has increased, and the cost has also increased significantly, up to 80 million yuan. This is probably the main factor why the Air Force finally gave up Xifei and asked Qi Yiming to produce it for free.  Even so, Leopard B still has nearly twice the profit, and the killing is not ordinary ferocity.

    The situation of Xiaolong is somewhat similar, but because its unit price is relatively low, its profit margins are also limited.  The ex-factory price of an FC-1 is about US$3 million. In addition to the small size of the aircraft itself, most of the technologies used are relatively mature. That is, the value of the composite materials on the WS-13A and the fuselage is higher.

    ¡°If foreign companies knew about the profits of Chinese military industrial enterprises, they would probably be jealous to death, and even jealous enough to use anti-dumping laws to find trouble.

    The two groups of people who were working together sat together. Zhou Yutong took out a piece of paper and handed it to Prince Bandar, "Your Highness, please burn it after reading it."

    Bandar took the piece of paper and looked at it: "The purchase of 200 Xiaolongs, the total contract value is 2 billion US dollars, 20% of the thank you money."

    Bandar¡¯s eyes jumped and he immediately put the piece of paper on the candle on the table and burned it. He was extremely excited.  A 20% kickback would be US$400 million. Although members of the royal family are not short of money to spend, such a large amount of kickback is really unsettling.  The British also proposed similar solutions, with roughly similar proportions.  In fact, after the Al Yamaha scandal was revealed, the police claimed that of the total agreement amount of 43 billion pounds, approximately 6 billion pounds was related to bribery.  This figure may not necessarily be used for kickbacks and bribes, but its terrifying extent still makes people familiar with the situation stunned.

    It can be said that the reason why Saudi Arabia does not consider other products, but only favors the British hurricane and typhoon, is absolutely inseparable from the huge amount of bribes.

    The amount of this bribe alone is a sky-high arms order.  Of course Qi Yiming wanted to take this piece, but he knew very well that without the money delivered to Saudi stakeholders, it would be difficult to decide on subsequent orders.

    Zhou Yutong actually had in mindIt is not peaceful. Such a large amount of kickbacks is definitely a huge crime in Western countries.  In fact, if it were exposed in China in later generations, it would even be worthy of being shot.  Of course, it is unlikely that such a thing will be exposed in China.

    "Because the batch is huge, the unit price of 8 million is actually a discounted weapon system price, but you can mark it as a fly-away price, and the extra 20% will be used for maintenance, repairs, weapons, training and infrastructure, etc.  Cost, what do you think of this condition?¡±

    Bandar is not very old, but he is quite greedy. He calculated that, including the 2 billion contract, the total value is only 5.74 billion US dollars, which is still far behind the 7.8 billion he brought.  He couldn't help but ask: "Can other contracts follow this model?"

    Zhou Yutong was immediately shocked, but he didn't show it on his face.  The bribery ratio provided by the British in another timeline was only 13%. If all contracts were sold according to Xiaolong's, then the bribery ratio given by China would have reached an astonishing 20%.  From a purely commercial perspective, such a contract is not a very efficient contract for the seller. Of course, this kind of thing cannot be measured from a purely commercial perspective.

    "The boss ordered a condition of 200 aircraft. I originally thought it was impossible, but I didn't expect that the Saudis did not consider the actual needs at all. This Prince Bandar was completely considering personal gains and losses." Zhou Yutong touched his head and felt nothing.  The sweat drops of existence, I secretly thought in my heart.  At the same time, I admire Qi Yiming for accurately grasping the thoughts of the Saudi people.

    He thought for a while and then said: "It may be difficult to follow this model in every contract, but we will try our best to find a way. Well, you can also refer to another model, because the input of a large number of fighter aircraft may lead to expensive  The country lacks flight personnel and support personnel, and we have agreed to export combat readiness forces to Saudi Arabia. Generally speaking, a team of more than 1,000 people will cost more than 100 million U.S. dollars a year. In fact, we have already paid our labor personnel.  Once the salary is paid, we can establish a confidential account named "ours" and actually yours. The money can be transferred several times and finally transferred to your hands. What do you think? "

    Bandar calculated that these people will stay in Saudi Arabia for at least two or three years, which will result in an income of two to three or three to four billion. He is very satisfied and starts with a big head.

    Zhou Yutong immediately said: "To realize the labor service model, we hope that you can agree to purchase 60 CJ-6, 30 K-8, and 30 L-15 trainer aircraft. These trainer aircraft are important for Saudi Arabia to improve its pilot training level."  It is quite helpful. The total value of the contract is US$350 million, which is quite favorable. Foreign countries want to buy so many training aircraft, and it is impossible without US$800 million. So we also hope that you can buy FBC-1B fighter jets.  The purchase quantity is increased to 100, of course, the more, the better.¡±

    The more Bandar and others heard about it, the less they could figure it out. They immediately asked: "Please give me detailed data for reference."

    Zhou Yutong smiled slightly and took out a piece of paper from the folder and handed it to Bandar.  Their conditions are written above: 100 FBC-1B fighters, 200 Xiaolong fighters, the fighters contain 1,200 PL-9 combat bombs, 600 PL-12 medium-range bombs, 600 PL-11 medium-range bombs,  200 C-705 anti-ship missiles, 200 250kg and 500kg Thunder series guided bombs, 20 sets of electronic warfare systems; 60 CJ-6 primary training aircraft, 30 K-8 intermediate training aircraft, 30  L-15 high-education aircraft, 8 sets of Thorn-2 air defense systems; and two C919 special planes for VIPs - the total contract value is US$6.8 billion.  Among them, US$800 million is in return of thanks.

    It has to be said that such a contract is very arbitrary for Saudi Arabia. China has not only expanded the initial contract for 72 Leopard B fighter jets to the current contract that includes so many other miscellaneous items, but also  Many things may not necessarily be used by the Saudis. For example, the two C919 passenger planes were stuffed in by Qi Yiming just to make up the money. He secretly planned to let the Saudis advertise their civilian aircraft.

    Bandar and his team are very satisfied with the up-and-down management of US$800 million. Most of this money will belong to him and his father, Prince Sultan, and the participating military personnel and government officials will also receive it.  part.  Of course, due to the need for proper money laundering, the amount they ultimately received could not be so large.

    Bandar and others discussed for a while, but Zhou Yutong just sat aside indifferently. After a while, Bandar spoke again: "We are very satisfied with the contract. Well, can you also give me a list of your other Chinese military products? We  Prepare for more purchasing points.¡±

    Zhou Yutong almost collapsed after hearing this. He knew that Bandar had a total of 7.8 billion US dollars, but he and his boss Qi Yiming had no intention of prying them out from the beginning, because no matter what, Chinese-made weapons remained  The reputation of high quality and low price is very important. Too much unreasonable price increase will affect future purchases from other countries.  But I didn't expect that Bandar, a prodigal, didn't take it seriously at all, and actually wanted to take the remaining money in his hand.Spend it all.

    Why is it obvious, it must be more kickbacks.
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