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1. The European Commission recently urged Chinese government to reduce steel capacity and launched anti-dumping investigation against Chinese steel products in three categories. Mr. Gao Hucheng, Minister of the Ministry of Commerce of the PRC stated that over capacity is encouraged to be solved properly through cooperation among enterprises, industries as well as governments.
MPI's comments: Some European companies filed trade remedy complaint under threat and shock of steel export from China. But importers and customers gained benefit from the export as a market behavior. The steel products are purchased in Chinese market at a reasonable price by European importers or customers. Therefore the complaint should be interpreted as a market behavior instead of political means implemented by the governments or the European Commission.
2. National Development and Reform Commission, Ministry of Industry and Information Technology of the PRC and SASAC jointly organized a teleconference focus on implementing Guideline of Overcapacity Elimination of the Steel Industry issued by the State Council.
MPI's comments: Refer to overcapacity elimination, complementary policies should be formulated urgently such as management of bonus and subsidies as well as specific measures covering taxation, finance, social security, territory, environmental protection, quality, safety etc. Furthermore proposal of relocation and reemployment should be prepared complying with varied conditions of steel enterprises to make sure social stability.
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