China’s economic development plans will force consolidation, especially in primary industries, even as new business opportunities are created, said executives including the head of the nation’s second-largest steelmaker.
Chinese industries “must upgrade themselves and discard backward production capacity,” Chinese Ministry of Finance’s research institute director Jia Kang (賈康) told executives yesterday at a conference in Beijing.
Output by Chinese steelmakers this year will fall about 90 million tonnes short of their total capacity of 650 million tonnes, Baosteel Group Corp (寶鋼集團) chairman Xu Lejiang (徐樂江) said yesterday at the same venue.
Xu said Baosteel would concentrate on reducing carbon emissions and energy conservation as it develops new products, such as specialty steel for electric vehicles.
The Chinese government is drafting its next five-year plan for economic development goals from next year to 2015. The National People’s Congress, China’s top legislative body, will review the plan for approval at its annual meetings in March.
China’s top policy makers will meet on Friday and Saturday to set economic policies for the coming year after the Chinese Communist Party’s Politburo said on Friday that the nation will shift next year to a “prudent” monetary stance from its current “moderately loose” one.
China may order higher reserve requirements for banks to counter capital inflows and a possible jump in lending at the start of next year, said Li Daokui (李稻葵), an adviser to China’s central bank.
China has been winding back stimulus measures to rein in liquidity and combat inflation. Inflows of capital to Asia threaten to fuel price gains and asset bubbles.
The People’s Bank of China (中國人民銀行) on Oct. 17 raised benchmark lending rates for the first time since 2007 to curb inflation that hit a two-year high in October.