Chinese Minister of Commerce: Resolving Steel Overcapacity Requires Global Efforts International Online Report (Reporter Wang Huanxing): Recently, the EU, Germany, and the United States have successively implemented trade protection measures on steel imports within a week, intensifying trade disputes in the global steel industry. It is noteworthy that many countries attribute the downturn in the steel industry to China. In response to the frequent trade disputes faced by Chinese steel, Chinese Minister of Commerce Gao Hucheng stated that overcapacity in the steel industry is a global issue that must be addressed collectively, rather than blaming a single country. Recently, the U.S. International Trade Commission announced the initiation of a "337 investigation" into steel products imported from China by 40 steel companies, including Ansteel and Baosteel. According to the investigation procedure, if the U.S. side determines that a company has violated regulations, the relevant products may be permanently banned from entering the U.S. market. Li Dongwei, General Manager of Ansteel Group International Trade Company, said: "In recent years, the U.S. has repeatedly initiated anti-dumping and countervailing investigations against Chinese steel products, but this time U.S. steel companies have invoked the 337 clause to investigate our steel companies, which is the first time. Moreover, the 337 clause mainly targets intellectual property issues. We believe that applying the 337 clause to the steel industry is inappropriate and inconsistent with the facts." In fact, the recent "trade war" initiated by Europe and the U.S. against China's steel industry is not limited to this. Data shows that from 2015 to now, there have been more than 50 trade dispute cases against China in the steel sector, involving over 8 billion U.S. dollars, with steel trade disputes escalating. According to Chinese Minister of Commerce Gao Hucheng, China is currently the world's largest importer of iron ore and the fifth largest importer of steel. From the perspective of the global steel structure, overcapacity in the steel industry is a global issue that must be addressed collectively, rather than blaming a single country. "In the global industrial chain, easily, casually, or excessively, or even abusing trade remedy measures is a very wrong choice. It may alleviate pressure in a certain area, but ultimately it will affect, even harm, the competitiveness of that country. At the very least, it will delay the exit of backward capacity."
It is understood that during China's "12th Five-Year Plan" period, 90 million tons of backward steel capacity have been eliminated, and during the "13th Five-Year Plan" period, it is planned to eliminate another 100 to 150 million tons. Gao Hucheng stated that China has also imposed strict restrictions on steel exports. "No country in the world has ever imposed additional taxes on its own steel exports; generally, product exports are subject to tax rebates. However, China introduced an export tax on steel products as early as the '12th Five-Year Plan' period, with a maximum rate of 25%, and this has been enforced to this day. At the same time, I believe this is also China's outstanding contribution to the development of the world economy, especially the steel industry, and is very responsible."
In the face of the recent frequent steel trade remedy investigations and accusations against China by Europe and the U.S., Gao Hucheng pointed out that China's contribution to the global steel industry cannot be denied. On one hand, China will actively protect the legitimate rights and interests of enterprises according to WTO rules; on the other hand, it is more important to strengthen communication and dialogue. "In handling trade frictions, in the 15 years since China's accession to the WTO, one-third of the total trade frictions and trade remedy measures have been directed against China, reaching over 800 cases. However, our experience is that the vast majority of significant industries and global economic impacts have been well handled through our consultations."
Experts also pointed out that the steel industry has become a key area of frequent trade frictions between China and other countries and regions, raising concerns about the global expansion of Chinese steel. In this regard, Pei Changhong, Director of the Institute of Finance and Trade Economics at the Chinese Academy of Social Sciences, stated in an interview that in the face of increasing trade frictions, China should standardize the operations of its enterprises and view the situation with a calm mindset. "There is a viewpoint that we may face very severe problems, but China's steel capacity is too large. To stabilize growth, we hope to export more, while others are also worried about the impact on their steel industries and cannot rule out that some prices are unacceptable to them, believing that trade remedies are needed. We should treat this with a calm mindset; I personally believe we should approach it calmly. This is a commercial dispute; what should we do? We need to be prepared to litigate, and my production costs are indeed like this, which prompts our enterprises to standardize. If you are going to litigate, you need to have a basis."