China stays tough on steel bar overcapacity

Source: XINHUA

China’s top economic planner has promised zero tolerance and harsh punishments for the illegal production of inferior-quality steel bars as the government remains firm in its capacity-cut drive.

From May 22 to June 15, the National Development and Reform Commission (NDRC) has sent eight teams to 21 provinces and regions to inspect whether production of inferior-quality steel bars had been seriously curtailed.

According to NDRC spokesperson Meng Wei, the capacity-cut drive has produced effective results, but some weak links remain in certain regions, including the illegal use of production facilities and illegal addition of new capacity.

Meng said the NDRC will continue to improve the monitoring mechanism to detect problems in a timely manner and punish those responsible for malpractice.

As excess capacity has weighed on China’s overall economic performance, cutting overcapacity has been high on the government reform agenda.

China plans to cut 30 million tonnes of ineffective steel capacity and 150 million tonnes of coal capacity in 2018, according to a government work report released earlier this year.

Source: XINHUA