* Excess capacity is a global problem - vice finmin
* Excess capacity requires global solutions - vice finmin
* China has pledged to quicken pace of capacity cuts
(Adds context, background)
HANGZHOU, China, Sept 2 China's industrial
overcapacity problems have arisen mainly due to slower global
demand, Vice Finance Minister Zhu Guangyao said on Friday ahead
of the G20 summit in Hangzhou.
Excess capacity is a global problem requiring global
solutions, Zhu said, echoing a line from a communique issued by
G20 finance ministers and central bankers in July.
Excess steel capacity in particular has been a hot-button
issue for many G20 countries this year, amid a slowdown in
global demand that has led to a steel glut, layoffs and idled
China looks set to export a record amount of steel this
year, creating frictions with its major trading partners.
Rising steel prices have complicated Beijing's efforts to
reduce capacity, but it has pledged to quicken the pace of its
industrial capacity cuts, particularly in steel, after falling
behind earlier in the year. It produces half the world's steel.
In the July gathering of G20 ministers, they cautioned that
subsidies and other types of support from governments or
government-sponsored institutions can cause market distortions
and contribute to global excess capacity.
China is looking to use market principles to address
industrial overcapacity, China's Vice Finance Minister Zhu said
(Reporting by Nathaniel Taplin; Writing by Ryan Woo; Editing by
Shri Navaratnam and Kim Coghill)