BEIJING — China is targeting further cuts in crude steel production capacity by as much as 150-million tonnes and "large-scale" reductions in coal output as part of its measures to curb overcapacity and excess labour in state-owned industries.
The country has lowered steel production by about 90-million tonnes "in recent years" and will push to cut between 100-million tonnes and 150-million tonnes, while "strictly controlling" steel capacity increases and halting new coal mine approvals, according to a statement on the Chinese government’s website on Sunday that cited a State Council meeting on Friday.
No time line was mentioned.
China has vowed in the past to curb capacity in industries such as coal and steel as the economy slows amid a shift to consumer-led growth. Still, it struggled to meet coal capacity limits spelled out in the Five-Year plan that ended last year, according to Bloomberg Intelligence.
Coal demand in the country is also declining, with the government keen to curb pollution.
The government planned to set up a fund to help coal miners and steel makers reduce their workforces and dispose of bad assets, Premier Li Keqiang said, according to a China Central Television report this month. The help was dependent on the companies cutting capacity, he said.
As part of rebalancing the economy towards domestic consumption, the country’s cabinet also pledged to ease conditions for rural-to-urban migration and expand "new urbanisation" trials to more regions, the government said in Sunday’s statement.
China would "more aggressively develop" small and medium-sized cities and give more administrative authority to areas with populations of more than 100,000.
China would also expand shanty town development in major cities, while reducing the barriers to entry to attract private capital investment in transport, underground pipe networks and other forms of construction.