China to use environmental rules to fight overcapacity

China will use the stricter enforcement of environmental, safety and energy efficiency standards as well as tougher credit controls to help fight against overcapacity in key industrial sectors, the government said. Reuters reports China has identified overcapacity as one of its key challenges and has pledged closures in the steel and coal sectors, but it has not met its targets. The Ministry of Industry and Information said on Friday in a draft policy document published on its website it would “normalize the stricter implementation and enforcement of mandatory standards” to tackle overcapacity in sectors such as steel, coal, cement, glassmaking and aluminum. Firms that fail to comply with new energy efficiency targets would be given six months to rectify and would be closed if they fail to make progress.