BEIJING (Reuters) – China’s government has tweaked its priorities to focus more on infrastructure, exports and fighting water pollution while slowing efforts to reduce capacity in coal and steel industries, state media reported on Wednesday.
The guidance from the State Council, or cabinet, is issued to local governments and authorities with the promise of financial support if they comply with the priorities set by Beijing.
“The State Council has decided to adjust old … stimulus measures implemented in 2016 based on the new situation, new mission and new orders,” said a Council document quoted by the state-backed China Information News.
The Council said new infrastructure should focus on construction of roads and waterways. It also called for more efforts to promote Chinese exports and attract foreign investment to the world’s second largest economy.
China reported far weaker than expected November exports and imports, showing slower global and domestic demand and raising the possibility authorities will take more measures to keep the country’s growth rate from slipping too much. [nL4N1YD06T]
The Council said it would give “further support to local governments that achieve outstanding work on some key policies,” the report said.
One area that will no longer be rewarded with additional funds is the effort to curb overcapacity in China’s bloated steel and coal sectors, the report said.
It suggests that China, the world’s top steel and coal producer, has achieved its planned reduction in overcapacity in these sectors. China has trimmed 150 million tonnes of steel and 800 million tonnes of coal capacity in the past five years.
China still has around 908 million tonnes of steel capacity and 5.1 billion tonnes of coal capacity.
The State Council will also offer more support to cities, especially those that have relied on natural resource industries, to improve the environment. It specifically mentioned water pollution and efforts to clean up rural areas.
Beijing has been fighting to clean up the nation after years of breakneck economic growth took their toll on the environment, with its massive steel sector bearing the brunt of its vigorous campaign. [nL4N1XV2BJ]
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Source: Investing.com
