Booster Package For China's Steel Sector

摘要

China's State Council has approved a stimulus package to help the steel industry weather the international financial crisis. The salient features of the package are:rnThe government will strictly control the increase in steel-making capacity and continue closing down low-tech mills.rnIt will adopt a flexible tax policy on steel exports to stabilise China's share of the global market.rnIt will encourage restructuring of steel-makers and cultivate competitive large-scale steel groups.rnOther measures include a special fund for technology upgrades, research and innovation, restoring order in iron ore imports and increased steel consumption at home.rnChu Xueliang, analyst with China Jianyin Investment Securities, said the plan would help solve the persistent problems of excess capacity, low industrial concentration and lack of raw materials.rnAnalyst Rong Gang of Langesteel, an industry information service, said China would consume about 500 mt of steel this year, assuming the economy grows by 8%.