China commits to cutting steel capacity, winding down enterprises: US Treasury's Lew

[BEIJING] China has committed to curbing its steel capacity and winding down weak state enterprises, US Treasury Secretary Jacob Lew said on Tuesday at the end of high-level talks between US and Chinese officials in Beijing.

"China has committed to ensure that its central government policies and support do not target the net expansion of steel capacity; and to actively and appropriately wind down 'zombie enterprises' through a range of efforts, including restructuring and bankruptcy," Mr Lew said.

Officials from the two countries failed to reach an agreement on how to address excess global aluminum capacity, Mr Lew said, but added that they would continue to hold discussions on excess capacity in the sector.

While China's aluminum smelters have pledged to shut down more production and not add capacity in 2016, market participants have expressed skepticism about the extent to which this will help reduce overcapacity.

REUTERS