2 deputy gov­er­nors guilty of ca­pac­ity vi­o­la­tions

China Daily (Hong Kong) - - FRONT PAGE - By WANG YAN­FEI wangyan­fei@chi­nadaily.com.cn

Two pro­vin­cial deputy gov­er­nors were pun­ished for al­low­ing steel mills that were pre­vi­ously shut down to restart op­er­a­tions, the first and most se­vere pun­ish­ment that has been handed to provin­cial­level of­fi­cials for fail­ure to abide by ca­pac­ity-cut poli­cies.

Ma Qi­ulin, deputy gover­nor of East China’s Jiangsu prov­ince, and Zhang Jiehui, deputy gover­nor of North China’s He­bei prov­ince, re­ceived ad­min­is­tra­tive pun­ish­ment handed out by the State Coun­cil.

The de­ci­sion was an­nounced dur­ing a meet­ing of the Po­lit­i­cal Bureau of the Com­mu­nist Party of China Cen­tral Com­mit­tee on Thurs­day, Xin­hua News Agency re­ported on Mon­day.

Pre­mier Li Ke­qiang stressed the im­por­tance of for­bid­ding con­struc­tion of new ca­pac­ity and re­new­ing ef­forts to cut ca­pac­ity.

Cheat­ing, say, sub­mit­ting ... statis­tics from op­er­a­tions that are al­ready shut down, will not be tol­er­ated.” Zhang Lin, se­nior an­a­lyst with dz18.com, an e-com­merce plat­form for the steel in­dus­try

A re­port re­leased in Septem­ber by the Al­liance for Amer­i­can Man­u­fac­tur­ing, a non­profit formed by lead­ing man­u­fac­tur­ers and the United Steel­work­ers union, blamed China’s slug­gish progress in cut­ting ca­pac­ity, which it said has caused a global im­por­ta­tion cri­sis and led to 19,000 steel­worker lay­offs in the US.

But Na­tional Devel­op­ment and Re­form Com­mis­sion data show that the na­tion had com­pleted yearly re­duc­tion goals by the end of Novem­ber, ahead of the sched­ule.

China in­tends to cut 45 mil­lion met­ric tons of steel ca­pac­ity and over 250 mil­lion tons of coal pro­duc­tion ca­pac­ity by year’s end.

Lin Bo­qiang, a se­nior en­ergy re­searcher at Xi­a­men Univer­sity, said that the gov­ern­ment may strengthen su­per­vi­sion and use of ad­min­is­tra­tive or­ders to ac­cel­er­ate the pace of over­ca­pac­ity cuts.

“Ad­min­is­tra­tive or­ders would help in times when the na­tion faces more head­winds in ca­pac­ity cuts next year,” Lin said.

Zhang Lin, a se­nior an­a­lyst with dz18.com, an e-com­merce plat­form for the steel in­dus­try, said the penalty given to the two pro­vin­cial-level of­fi­cials should warn of­fi­cials in other places.

It shows that “cheat­ing, say, sub­mit­ting re­duced ca­pac­ity statis­tics that in­clude data from op­er­a­tions that are al­ready shut down, will not be tol­er­ated”, she said.

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