Premier Li Keqiang said China will take solid and effective steps to cut overcapacity this year. The Premier announced this while delivering a government work report on March 5 at the opening meeting of the 5th session of the 12th National People’s Congress.
“This year, we will further reduce steel production capacity by around 50 million metric tons and shut down at least 150 million metric tons of coal production facilities. At the same time, we will suspend or postpone construction on or eliminate no less than 50 million kilowatts of coal-fired power generation capacity, in order to guard against and defuse the risks of overcapacity in coal-fired power, improve the efficiency of this sector, and make room for clean energy to develop,” said Premier Li.
“We will strictly enforce all laws, regulations and standards on environmental protection, energy consumption, quality and safety and make more use of market- and law-based methods as we work to address the problems of ‘zombie enterprises,’ encourage enterprise mergers, restructuring and bankruptcy liquidations, shut down all outdated production facilities that fail to meet standards, and stringently control the launching of new projects in industries that are already saddled with overcapacity,” he continued.
“As overcapacity is cut, we must provide assistance to laid-off workers,” he added. “Central government special funds for rewards and subsidies should be promptly allocated and local governments, and enterprises need to put in place related funds and measures, to ensure that laid-off workers can find new jobs and secure their livelihood.”