Chairman of Magnitogorsk Iron & Steel Works (MMK) Viktor Rashnikov took part in Russian President Dmitriy Medvedev’s informal meeting with heads of Russia’s major enterprises. The meeting was also attended by Vladimir Potanin, Alisher Usmanov, Mikhail Fridman, Viktor Vekselberg, Mikhail Prokhorov, Oleg Deripaska, Alexei Mordashov, Alexei Miller, and Sergey Galitskiy. In the course of the meeting, they spoke about the way the global financial crisis has been affecting the economy’s real sector and how the state and business could cooperate under these trying circumstances. The business executives informed the President about the measures they had taken to minimize the trouble.

MMK, for one, adopted a strict retrenchment policy early in October 2008 and had to temporarily halt all of its investment projects except for the utterly important plate mill 5000. In addition, the company cut back on production expenses as well as the general running costs and introduced stringent financial discipline.

Then, the enterprise has come up with a plan for reducing the outgoings and raising liquidity in the last quarter of 2008. The plan provides for the enterprise’s stable operation despite the crisis thanks to reduced expenses, improved raw material reserves, reconsidering the investment projects’ schedule, getting the customers to pay off their debts, attracting finance, and paying off the tax debts. The better part of reduced outgoings is expected to be done through the business’s internal reserves.

MMK Group is also implementing a centralized purchases program for all kinds of items and relies heavily on its own electricity resources. Cutting down on coke use means the company can spend less of it in cast iron production.

Despite the arising problems, MMK is doing its best to operate stably, avoid redundancies, and preserve its workers’ social guarantees.