Shanghai, November 11 (Gasgoo.com) China will encourage mergers and restructuring in the country's steel sector to help create three to five globally competitive steel-making giants, Xinhua News reported today, citing a statement of the Ministry of Industry and Information Technology.
Six to seven leading steel producers will be urged to carry out strategic mergers and restructuring across the country, according to the Guidelines on Promoting Steel Sector Mergers and Restructuring, an official statement released yesterday at the industry ministry's website.
The guidelines were drawn up to address and tackle the domestic steel sector's structural problems, such as low industry concentration and high percentage of backward production capacity, the statement said. These problem are similar to those faced by Chinese automakers.
The ministry also mapped out Steel Sector Admittance Requirements to regulate steel enterprises through enforcing standards on product quality, environmental protection, energy consumption, resources use and production scale.
Earlier this year, the Chinese government announced its plans to encourage consolidation of its auto companies into a "big four" and a "small four" segment to make the industry more competitive with international rivals.
Changan Auto yesterday announced its merger of the auto-making operations of China's aircraft maker AVIC, and earlier this year, Guangzhou Auto signed a deal to take a 29% stake in SUV-maker Hunan Changfeng Motor.
