China takes further step against over-investment in steel industry
According to recent news in the market,
China has taken further step to hinder over-investment in sectors such as steel, cement and real estate.
As previously reported by SteelOrbis,
China took certain measures to limit money flow for
investments in steel, cement and real estate sectors. However, despite government warning,
investments in the subject sectors have continued to increase as the demand is strong. This situation led to problems in supply of coal, power and oil.
China's economy has grown remarkably due to
investments backed by bank loans.
According to new decision of the government, steel companies, planning to invest in new steel projects will meet 40% or over of the total investment they will make, thus bank loans for new steel projects will not constitute more than 60% of the total investment.