Ministry of Industry and Information Technology considering guidelines on eliminating outdated cement capacity

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China: The Ministry of Industry and Information Technology (MIIT) and related departments are considering draft guidelines on eliminating outdated production capacity in cement, ship-making, electrolytic aluminium and glass industries, according to Xinhua. At least 500Mt of ‘low-grade’ cement production capacity will be phased out.

The central government decided to promote supply-side reform at the end of 2015. Eliminating outdated capacity is a top priority. Methods to do this include phasing out outdated capacity, removing ‘zombie’ enterprises and promoting industrial reorganisation.

Kong Xiangzhong, vice president of China Cement Association, has advised the central government to provide certain compensation for the industry and establish a special fund so as to appropriately deal with the re-employment of redundant personnel and enterprise debts. Several provinces have specified their targets. Guangdong Province plans to cut clinker production capacity to 110Mt by the end of 2018.


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