UK asks China to accelerate cuts on over production of steel

Britian has pressed China to speed up its efforts to cut down steel production amid concerns that Chinese steelmakers are dumping excess on the global market, triggering a crisis in countries like the UK.
British Foreign Secretary Philip Hammond discussed the issue of over-capacity in steel production with his Chinese counterpart here yesterday.
"I urged China to accelerate its efforts to reduce levels of steel production," Hammond said.
"The UK's focus is on finding a long-term sustainable future for steel making at Port Talbot and across the UK, and I welcomed the potential interest of Chinese companies in investment in UK steel making," he said.

Hammond met Wang Yi on his way to Hiroshima for the G7 foreign ministers' meeting and had an opportunity to talk about "issues of mutual concern".
As Chinese domestic demand for steel has fallen following a slowdown in the communist giant's economy, its steelmakers have been accused of dumping excess production on the global market.

China yesterdya said that plans to shut steel mills over the next five years would cut capacity to an estimated 1.13 billion tonnes by 2020 - a figure that still far exceeds domestic demand.
Cheap Chinese steel is one reason why UK-based producers, such as Tata and Caparo Industries, have found it harder to remain profitable. Higher energy costs in Britain compared with other countries are another factor.

China itself has been hit by massive overcapacity problems as steel prices and demand have plummeted. Tens of thousands of workers have been laid off as part of recent government-driven cuts in the steel industry.
The growing international controversy surrounding China's steel industry comes at an awkward time for the Chinese government, which is seeking to secure EU "market economy status" by the end of the year, the Financial Times reported.
China argues that the designation, which would make it harder to prove that Chinese steel plants were "dumping" their products overseas at below cost, should be granted automatically under the terms of its 2001 World Trade Organisation accession agreement, the report said.