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China’s Economy Still Has Overcapacity Issue

Li Yi, the Minister of Industry and Information Technology, recently commented on the overcapacity issues, referring to industries such as steel, concrete, nonferrous metals, aluminum, coal,  chemicals, and others. Li mentioned that the central government tends to continue proactive fiscal policies and moderately easy monetary policies. On the industrial side, the policies focus on homegrown innovations, small and medium sized businesses, new industries and technological reforms. Expansion in the industries with overcapacity problems will not be supported. These industries will be controlled by (issuing) fewer loans and (allocating) less land.

Source: Global Times, March 12, 2010