On December 12, the deputy director of the Macroeconomic Research Institute of China's National Development and Reform Commission (NDRC), Chen Dongqi, stated that China's economy had entered its fourth phase of increasing economic growth, a phase which would require more steel compared with the first three phases of economic growth.
According to Mr. Chen, China's construction work in relation to railways would greatly boost steel demand. Also, with an urbanization rate of merely 18 percent in China, accelerated urbanization would generate significant demand for rail transportation.
Moreover, the auto industry will also drive up demand for upstream steel products. Currently, 8.8 families out of every 100 Chinese families own cars, and this figure will rise to ten this year. Therefore, the overall level remains relatively low. China's car sales are expected to reach 13.2 million units this year, indicating strong growth.
Mr. Chen also said that the development of the real estate industry and of pipeline engineering projects would also significantly contribute to increased demand for steel products.
The NDRC official predicted that China's GDP would register growth of more than 8.2 percent this year, rising to 10 percent next year, boosted by fiscal and monetary policies.