[SMM Steel Morning News] Ministry of Commerce: "Insufficient domestic demand in China leads to overcapacity" not consistent with facts

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Macro

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[Ministry of Commerce: "Insufficient Domestic Demand in China Leads to Overcapacity" Claim Is Inconsistent with Facts]

The Ministry of Commerce released "China's Position on the So-called 'Overcapacity' Issue" on July 28, pointing out that the claim that "China's insufficient domestic demand leads to overcapacity" is inconsistent with the facts. China is not only a manufacturing powerhouse but also a major consumer. Domestic demand has always been the main engine of China's economy, with an average contribution of 93% to China's economic growth from 2013 to 2024. Based on World Bank purchasing power parity, China's total retail sales of consumer goods in 2025 was equivalent to 1.7 times that of the US, making it the world's largest consumer market for goods in real terms. Currently, China's physical consumption ranks first globally, and the per capita annual consumption of some industrial products has approached the level of developed countries. In recent years, the growth of China's total retail sales has slowed, which is in line with China's transition from high-speed growth to high-quality development and also reflects the upgrading trend of China's consumption structure. Viewing the slowdown in China's retail sales growth as insufficient domestic demand is not objective or comprehensive. The argument that "China's insufficient domestic demand leads to overcapacity" is a distortion of concepts, applying micro-level market phenomena to the macro-structural level. (Xinhua News Agency)

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[PBoC: Outstanding RMB Real Estate Loans at End of Q2 Stood at 50.74 Trillion Yuan, Down 4.9% YoY]

The People's Bank of China released its statistical report on financial institution loan allocation by sector for Q2 2026. At the end of Q2 2026, outstanding RMB real estate loans stood at 50.74 trillion yuan, down 4.9% YoY, declining by 1.23 trillion yuan in H1. At the end of Q2 2026, outstanding real estate development loans were 12.65 trillion yuan, down 8.5% YoY, declining by 540.2 billion yuan in H1. Outstanding individual housing loans were 36.29 trillion yuan, down 3.8% YoY, declining by 716.3 billion yuan in H1.

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Industry and Downstream

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[National Energy Administration: Total Number of EV Charging Infrastructure Ports Reached 23.057 Million by End-June, Up 43.2% YoY]

The National Energy Administration released national EV charging facility data for H1 2026. According to data from the National Charging Infrastructure Monitoring and Service Platform, as of the end of June 2026, the total number of EV charging infrastructure ports in China reached 23.057 million, up 43.2% YoY. Among them, public charging facility ports numbered 5.009 million, up 22.3% YoY, with a total rated power of 247 million kW and an average power of approximately 49.35 kW per port. Private charging facility ports were 18.048 million, up 50.4% YoY, with installed utility capacity for private charging facilities reaching 155 million kVA.

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[NDRC: Will Closely Follow the 15th Five-Year Plan Deployment to Continuously Strengthen the Brand Building of the China-Europe Railway Express]

The National Development and Reform Commission (NDRC) held a special press conference on the China-Europe Railway Express. Liang Linchong, Director of the Department of Opening-up of the NDRC, stated that the China-Europe Railway Express officially adopted a unified brand and has gone through a decade of high-quality development. Over the past decade, its product services have been continuously optimized, with new offerings such as customized and e-commerce trains being enriched, effectively meeting diversified and personalized market demands. Next, the NDRC, together with relevant parties, will closely follow the national 15th Five-Year Plan deployment, continuously strengthen the brand building of the China-Europe Railway Express, enhance its internationalization and marketization, consolidate and improve its development resilience, and promote its development toward higher quality, greater efficiency, and enhanced security.

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[Ministry of Housing and Urban-Rural Development: Solidly Advance the Organization and Implementation of Elevator Installation Projects in Old Residential Communities Supported by Government Bonds]

The Urban Construction Department of the Ministry of Housing and Urban-Rural Development recently held a video conference on using ultra-long special government bond funds to support the renewal of old residential elevators and the installation of elevators in old residential communities, reporting on work progress, exchanging regional experiences and practices, and deploying key tasks for the next step. The meeting emphasized that housing and urban-rural development authorities should coordinate with market supervision departments to strengthen the supervision and management of elevator renewal projects supported by bonds, accelerate the implementation of bond-supported projects while ensuring quality and safety, and enable the public to safely use the elevators as soon as possible with peace of mind. All regions should solidly organize and implement elevator installation projects in old communities supported by bonds, establish and improve inter-departmental liaison and coordination mechanisms to foster synergy, prudently handle community work to promote consensus among residents, and strengthen full-process supervision to ensure the quality and safety of elevator installation projects.

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[Beijing Issues Implementation Opinions on Block Regulatory Detailed Planning Reform]

The Beijing Municipal Commission of Planning and Natural Resources issued the "Implementation Opinions on Deepening the Reform of Block Regulatory Detailed Planning Management Adapted to Urban Renewal in Beijing." The Opinions adhere to overall planning based on planning blocks as the basic unit, innovatively establishing a block regulatory detailed planning compilation and management system with tiered compilation, graded approval, and full-process supervision. While maintaining rigid spatial transmission, they leave sufficient flexibility in the time dimension for the renewal and renovation of existing areas. Urban renewal implementation plans and urban village redevelopment plans are treated as specific types of comprehensive planning implementation plans, integrating them into one. Following a work approach of planning-led project generation, the "four steps, eight lists" planning method is promoted, shifting from spatial planning to strategic planning and guiding the precise allocation of resources over time. The implementation focus in existing areas is shifted to public environment, public space, and public services, encouraging the exploration of mixed-use utilization, scale flow management, and improvement-oriented municipal and transportation upgrades as planning standards adapted to urban renewal. Municipal and district departments are guided to coordinate policies and funds, using public investment to drive value enhancement and active market participation, and jointly promoting the overall leap from "good housing" to "good neighborhoods" through an effective government and an efficient market.

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Other Hot Topics

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⭕[Hainan Prefecture, Qinghai, Earthquake Relief Command Activates Prefecture-Level Earthquake Disaster Level III Emergency Response]According to official determination by the China Earthquake Networks Center, a magnitude 5.7 earthquake struck Xinghai County, Hainan Prefecture, Qinghai (latitude 35.35°N, longitude 99.57°E) at 11:16 on July 28, 2026, with a focal depth of 10.0 km. At 11:34, a magnitude 5.8 earthquake struck Xinghai County, Hainan Prefecture, Qinghai (latitude 35.35°N, longitude 99.58°E) with a focal depth of 10 km. In accordance with the provisions of the "Earthquake Disaster Emergency Plan of Hainan Tibetan Autonomous Prefecture" and based on comprehensive assessment of the on-site situation, the Hainan Prefecture Earthquake Relief Command decided at 12:00 on July 28, 2026, to activate the prefecture-level earthquake disaster Level III emergency response.

⭕[Guangxi Zhuang Autonomous Region Department of Water Resources Initiates Level IV Flood Defense Emergency Response]According to meteorological and hydrological forecasts, under the combined influence of the remnant system of this year's 12th typhoon "Hongxia" and the southwest monsoon, most parts of Guangxi Zhuang Autonomous Region will experience a relatively heavy rainfall process from July 28 to August 1. Some rivers may see floods exceeding warning levels, with a relatively high risk of flash floods and karst waterlogging, which is unfavorable for the safe flood season operations of risky reservoirs and ongoing projects. Based on the flood defense work plan of the Guangxi Department of Water Resources and after comprehensive analysis and assessment, it was decided to initiate a Level IV flood defense emergency response from 9:00 on July 28.

⭕[China Railway: High-Value-Added Goods Such as Automobiles and Electronic Appliances Have Become Major Export Cargo of the China-Europe Railway Express]The NDRC held a special press conference on the China-Europe Railway Express. Wu Zhaoxin, Director of the Freight Department and Logistics Center of China Railway, stated that during the 14th Five-Year Plan period, China Railway deepened domestic and international coordination and cooperation around the safe, stable, and high-quality development of the express, accelerated the construction of four major systems, and achieved accomplishments in three aspects. First, the transportation network service scope basically covers the Eurasian region. Second, transportation organization has been innovatively optimized, with the transport quality and efficiency of the express continuously improved. Third, the brand influence and competitiveness of the express have been continuously enhanced, with high-value-added goods such as automobiles, auto parts, machinery equipment, and electronic appliances having become the main export cargo of the China-Europe Railway Express. Next, China Railway will focus on the three directional goals of higher quality, greater efficiency, and enhanced security, innovate operation and management models, deepen domestic and international cooperation, and continuously invigorate the market vitality and development momentum of the express.

⭕[Greentown China Acquires Residential Land in Liwan, Guangzhou for 1.686 Billion Yuan at a 40.97% Premium]A residential-related land parcel in Liwan District, Guangzhou, was officially auctioned on July 28. Located in the core of the Huadiwan area of Liwan, it is the original redevelopment site of the Fangcun Coach Station. After 50 rounds of bidding, Guangzhou Lvsheng Real Estate Development Co., Ltd., a subsidiary of Greentown China (03900.HK), won the land for a total price of approximately 1.686 billion yuan, at a premium rate of 40.97%.

⭕[Total Price Nearly 2.9 Billion Yuan: Taizhou Weixing Real Estate Snaps Up Two Land Parcels in Hangzhou Future Sci-Tech City]Hangzhou auctioned two residential-related land parcels in Yuhang Future Sci-Tech City today, with a starting total price of 2.535 billion yuan. Ultimately, both parcels were acquired by Weixing Real Estate, with a total transaction price of 2.875 billion yuan. Among them, plot HZC [2026] No. 60, with a planned building area of 75,380 m² and a starting price of 1.395 billion yuan, was won by Taizhou Weixing Real Estate Company for 1.555 billion yuan after 16 rounds of bidding, at a transaction floor price of 20,623 yuan/m² and a premium rate of 11.47%. Plot No. 61, with a planned building area of 64,024 m² and a starting price of 1.14 billion yuan, was also won by Weixing Real Estate for 1.32 billion yuan, at a transaction floor price of 20,617 yuan/m² and a premium rate of 15.79%.

⭕[CNOOC Acquires Residential Land in Jiuxianqiao, Chaoyang, Beijing for 4.6814 Billion Yuan at a 25.84% Premium]A residential land parcel in Jiuxianqiao, Chaoyang District, Beijing, was auctioned on July 28. With a planned building area of 57,750 m², the starting price was 3.72 billion yuan, at a starting floor price of 64,416 yuan/m². The plot received 6 rounds of online bidding before the auction, and a total of 6 real estate companies participated in on-site bidding. After 248 rounds of offline bidding, CNOOC ultimately won the land for 4.6814 billion yuan, at a transaction floor price of 81,063 yuan/m² and a premium rate of 25.84%.

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