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Steelmaking Countries Leave Brussels Without Agreement on Capacity Problem
04/19/2016 - The world’s largest steelmaking countries agree that there is more steel than the planet has use for, but they disagree on how to solve the problem and left a meeting in Belgium without having made any commitments to reduce it.
Representatives from approximately 30 countries, including China, Japan, Germany India and the United States, attended the meeting, held by the Belgian government and the Organisation for Economic Co-operation and Development.
In a statement, U.S. officials blamed China and other countries for preventing broad consensus, saying those countries would not accept that their excess capacity -- and government support of that capacity -- has brought on the current steel industry crisis.
“Unless China starts to take timely and concrete actions to reduce its excess production and capacity in industries including steel, and works with others to ensure that future government actions do not once again contribute to excess capacity, the fundamental structural problems in the industry will remain, and affected governments – including the United States – will have no alternatives other than trade action to avoid harm to their domestic industries and workers,” U.S. Secretary of Commerce Penny Pritzker and U.S. Trade Representative Michael Froman said following the meeting.
But in an interview with Xinhua, China’s official news agency, China Assistant Minister of Commerce Zhang Ji said excess capacity is a global problem and that the country already is doing its part to curb it.
Zhang pointed to the country’s commitment to cut 100 million to 150 million metric tons of capacity over the next five years and its plan to spend US$15 billion to resettle displaced workers.
He also said a slow recovery of the world’s economy has given rise to sluggish demand, which is making the problem worse.
In a separate commentary,Xinhua wrote that blaming China is "a lame and lazy excuse for protectionism.”
The Reuters news agency, meanwhile, reported that China’s steel production in March rose to a record 70.65 million metric tons, 834 million metric tons on an annualized basis.
Citing the China Iron & Steel Association, Reuters said the record output was due to the recent jump in steel prices – they’re up 42 percent so far this year in China – which has led to a rapid reopening of idled mills.
In a statement, U.S. officials blamed China and other countries for preventing broad consensus, saying those countries would not accept that their excess capacity -- and government support of that capacity -- has brought on the current steel industry crisis.
“Unless China starts to take timely and concrete actions to reduce its excess production and capacity in industries including steel, and works with others to ensure that future government actions do not once again contribute to excess capacity, the fundamental structural problems in the industry will remain, and affected governments – including the United States – will have no alternatives other than trade action to avoid harm to their domestic industries and workers,” U.S. Secretary of Commerce Penny Pritzker and U.S. Trade Representative Michael Froman said following the meeting.
But in an interview with Xinhua, China’s official news agency, China Assistant Minister of Commerce Zhang Ji said excess capacity is a global problem and that the country already is doing its part to curb it.
Zhang pointed to the country’s commitment to cut 100 million to 150 million metric tons of capacity over the next five years and its plan to spend US$15 billion to resettle displaced workers.
He also said a slow recovery of the world’s economy has given rise to sluggish demand, which is making the problem worse.
In a separate commentary,Xinhua wrote that blaming China is "a lame and lazy excuse for protectionism.”
The Reuters news agency, meanwhile, reported that China’s steel production in March rose to a record 70.65 million metric tons, 834 million metric tons on an annualized basis.
Citing the China Iron & Steel Association, Reuters said the record output was due to the recent jump in steel prices – they’re up 42 percent so far this year in China – which has led to a rapid reopening of idled mills.
