Shandong Machinery & Equipment Import & Export Group Corp.(SDMEC) was set up, SDMEC was owned by state, mainly dealing in machinery import and industrial parts export. 

The development department of SDMEC was reformed to Shandong Sound Metals & Machinery Inc.(SMI), mainly dealing in valves and pipe fittings. The SMI share was 51% SDMEC hold and 49% workers hold.

The import department and machinery department of SDMEC joint to SMI, mainly dealing in industrial castings, valve and pipe fittings, machine tools, auto maintenance equipments, measuring and cutting tools. The share was 75% workers hold and 25% SDMEC hold. 

The annual export amount was over 10 million US dollor, mainly dealing in industrial castings, valves and pipe fittings, mine parts, auto parts, railway parts, machine tools and accessories, auto maintenance equipments, measuring and cutting tools.