Hebei steps up efforts to carve up overcapacity

Source:Global Times Published: 2016/7/12 0:18:01

The NDRC pushes for preset agenda

North China's Hebei Province is carrying out a campaign to address the country's overcapacity issue, with the dismantling of equipment at 35 companies, according to a statement posted on the provincial government's website on Monday.

Authorities dismantled equipment at 35 companies on Saturday in a province-wide action carried out at eight cities, including famous steel cities Tangshan and Handan, and the provincial capital Shijiazhuang.

The campaign is one of the most wide-ranging in recent years and covers a total of five industries, including steel, coal, cement and flat glass, which are saddled with overcapacity.

Authorities leveled to the ground six blast furnaces, with an annual iron-making capacity of 3.12 million tons, and eight converters, capable of producing 4.86 million tons of steel each year.

They also closed down 10 coal mines with an annual capacity of 3.01 million tons and five cement mills with a capacity of 0.95 million tons a year.

The statement also said the province's determination to cut overcapacity wouldn't be altered by a recovering market.

The National Development and Reform Commission (NDRC), the nation's top economic planner, has been prompting cuts to overcapacity according to a preset agenda since mid-June.

Inspection teams were dispatched to provinces including Hebei, Anhui and Henan to oversee work and prevent slowdown.

In late June, NDRC Chairman Xu Shaoshi said at this year's Annual Meeting of the New Champions, or Summer Davos, held in North China's Tianjin, that China would decrease coal-making capacity by 280 million tons and iron and steel-making capacity by 45 million tons within the year. Roughly 700,000 and 180,000 employees will be affected, respectively.

Xu said tackling unemployment from the overcapacity-cutting efforts would be a challenge, but policies will be in place to meet that.

During the 13th Five-Year Plan period (2016-20), Hebei Province will need to cut its iron-making capacity by 49.89 million tons and steel-making capacity by 49.13 million tons. According to government plans, some cities in Hebei will see all steel plants closed or moved out of the cities to coastal areas.

During the 12th Five-Year Plan period (2011-15), Hebei Province trimmed down its steel-making capacity by 41.06 million tons a year and cement-making capacity by 138.34 million tons per year, said the statement on Monday.

The fight against overcapacity has helped the province restructure its economy and increase the share of its tertiary industry to 40.2 percent in 2015 from 34.9 percent in 2010 in terms of value added, the statement said.

Posted in: Industries, Economy

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