China Urges Metals Firms to Build Plants Abroad

BEIJING, Oct. 19 -- Chinese producers of steel and non-ferrous metals should build plants overseas, a senior government official at China's top planning body, the National Development and Reform Commission (NDRC), said on Monday.

    China has long pushed a "go abroad" policy which has mainly translated into asset acquisitions by its cash-rich, state-owned firms. But domestic industrial growth has been far bigger, turning China into by far the world's biggest producer of steel and a leading or top producer of many other metals.

    China is now trying to trim capacity in many industries, including steel and base metals production, in an effort to tackle waste, pollution and excess supply.

    "As for excessive steel capacity at home, we encourage firms in these sectors to set up steel plants overseas to relieve pressure on resources and the environment at home," said Xiong Bilin, deputy director of NDRC's Department of Industry.

    "In fact, some companies have been trying in this regard, some of our non-ferrous firms are also trying to go abroad. In an overall view, this is a path of sustainable development, and it is time for Chinese companies to go abroad.," Xiong told a news conference.

    China's 2009 apparent steel consumption is expected to rise about 120 million tonnes from 2008, up 26 percent, according to the China Iron & Steel Association (CISA).

    The country's current steel inventories are estimated at 40 to 50 million tonnes, the association said last week.

    (Source: Reuters)