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China's attempt to export its way out of glut threatens world economy

Its stimulus push during 2008 financial crisis protected jobs worldwide, but now overcapacity poses grave consequences for the steel and aluminium industries.

China's 2016 budget recognises the problem of excess labour: 1.8 million workers in the steel and coal industries will be laid off, and 100 billion yuan allocated to compensate, reallocate and retrain workers affected.

AT THE height of the 2008 financial crisis, as the world peered into an abyss, China earned global gratitude by pumping a record amount of stimulus into its economy. Ironically, continued stimulus has left the Chinese economy with mounting debt and a production glut threatening world trade.