State Council: Curbing Overcapacity in Certain Industries

Necessary

Premier Wen Jiabao dissuades redundant construction. Cnsphoto

    Premier Wen Jiabao presided over an executive meeting of the State Council on August 26 to curb overcapacity and redundant construction, and guide the healthy development of industries. To cope with the impact of the international financial crisis, the state has formulated a plan for critical industrial adjustments and revival, and released a series of policies and measures to boost structural adjustment, including controlling the total amount of construction, eliminating obsolete technology, and encouraging the merger and reorganization of enterprises and independent innovation. Initial results are satisfactory, but in some sectors little progress has been made in structural adjustment, so overcapacity issues still hang over some industries, and redundant construction is still obvious. Blind expansion has persisted in certain traditional industries like steel and cement, and redundant projects have also surfaced in the emerging sectors of wind power and polysilicon, a substance used in making semiconductors. The meeting concluded with a state resolution to curb industrial overcapacity and redundancy, and a consensus that every effort should be made to develop the hi-tech sectors and help service industries meet market demands. The emphasis is placed on guiding the development of steel, cement, plate glass, coal chemicals, polysilicon, and wind power equipment sectors.