China's national policy to merge certain companies

China’s national policy to merge certain companies

China is expected to issue its national policy in the first quarter of 2005. As previously reported by SteelOrbis, the policy will cover subjects such as financing management, technique equipment and the rules on the market entry. The policy will aim to upgrade steel industry's overall structure and to reduce dependency on import market. Under the scope of the policy, high technology will be applied to produce flat products and the producers will be encouraged to invest iron ore mining in foreign countries to ensure raw material availability. However, it is stated that survival for small mills will be difficult under these circumstances. SteelOrbis is informed that certain mills in China have started to negotiate for a merger or a takeover deal.