When it took aim at the "resource-intensive" industries last month and imposed a series of tax changes, China's Ministry of Commerce said it was acting in the interests of a sector that needed to cool down.
A 10% hike in export duties on aluminum to 15% was headline news for commodities traders as a number of export tax rebates bit the dust.
These rebates were originally introduced in the late 1990s to help stave off the Asian financial crisis. Now, the ministry told the domestic players that howled in protest, changes were being made to alleviate the trade balance with the US.
The truth is far less impressive. Beijing has leveled a toothless tax, which calls into question the state's ability to successfully regulate an all-star industry.
In recent years the government has become increasingly concerned with the meteoric growth of resource-intensive industries. This term serves as a political catch-all for the more infamous side of China's economic miracle: polluting, socially divisive and surplus-bloating industries. The economic utility of that characterization is suspect, but it has been useful in trade negotiations and to promote "social harmony".
Faced with trade partners making ever more noise about imbalances and a white-hot economy, the government has publicly declared it will intervene in bringing such dirty industries to heel. Aluminum, with its explosive growth and equally explosive electricity bill, falls squarely in the government's sights.
China is the world's largest aluminum-producing and -exporting nation. Domestic production of primary aluminum (aluminum produced from aluminum ore, also called bauxite) accounts for 25% of global production, according to the International Aluminum Institute.
Production has grown nearly 20% annually over the last five years.
In November, the government raised the export tariff on aluminum after nearly three years of dire pronouncements. Some local industry groups were critical while international investors responded with caution. Equity research group Davenport & Co noted: "We think that the tariff will push [Chinese aluminum] into a more neutral position in the long term."
Realistically, the tax is nearly meaningless. The tariff increase only applies to exports of primary aluminum, ie aluminum exported in raw ingots. Fabricated aluminum, anything from foil to airplanes, stills receives generous rebates.
This means that virtually all exports slip through the net.
No primary player
As of mid-2006, China exported less than 1% of its primary aluminum, according to the ministries of customs and trade, down from a height of around 2% in 2005. Secondary or recycled aluminum is still imported in prodigious quantities and accounts for a large portion of aluminum consumption.
"China isn't a real global exporter of primary aluminum," said Stephen Larkin, president of the Aluminum Association. "The only effect of the tax that we can see might be to be put a few of the oldest, least efficient plants out of business."
Beijing knows it has to rein in over-investment in aluminum and other industries like it. But the regulators appear unwilling to even lightly wound, let alone kill, the state-owned giants.
For a country determined to accomplish a soft landing through keen regulation rather than more market-driven alternatives, this is a concern. If the aluminum non-tax is a litmus test of Beijing's ability to make good on this intention, it may have failed.
However, politics and rhetoric may be enough to satisfy the Communist Party leadership, according to James Southwood, president of the Commodity Metals Management Company.
"For the government, it's a philosophical issue more than an economic issue."