Steel Institute Comments on Report Today on China as a Non-Market Economy

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For Immediate Release
May 1, 2014

WASHINGTON, D.C. – The American Iron and Steel Institute (AISI) said a report released today by the Center for American Progress (CAP) indicates that economic reforms announced by Chinese leadership last fall will do nothing to mitigate China’s state-ownership and control over key industrial sectors, including steel.

“Government ownership and control of key aspects of the Chinese economy lead to significant economic distortions, including a massive build-up in excess steelmaking capacity in China. The state-run economy prevents normal market forces from operating in China and produces harmful effects in global markets. Private companies in the United States and elsewhere can’t compete with foreign governments, and the impact has been seen across the steel industry. Despite the rhetoric from the Chinese government last fall, today’s report reaffirms that these announcements won’t move the needle toward a market economy in China," said Thomas J. Gibson, president at CEO of AISI.

The report from the Washington, D.C. think tank today examined the announced economic reforms underway in China, which were proposed by Chinese leadership as part of the so-called “Third Plenum" meeting of the Communist Party last fall. The detailed analysis indicates that the basic economic institutions in China remain state-controlled and will continue to operate on non-market principles, even if the Third Plenum reforms are implemented as announced. “China’s economy will still operate with broad government involvement in the ownership and control of key industrial sectors and corporate finance, with the Communist Party and the Chinese state retaining authority over key economic decisions," Gibson said. “We hope policymakers and others who can help change this course will take notice of this important research and analysis released today."

The report can be found at www.americanprogress.org.

Contact: Lisa Harrison
202.452.7115 / lharrison@steel.org

Click here for a PDF version of this release.

AISI serves as the voice of the North American steel industry in the public policy arena and advances the case for steel in the marketplace as the preferred material of choice. AISI also plays a lead role in the development and application of new steels and steelmaking technology. AISI is comprised of 22 member companies, including integrated and electric furnace steelmakers, and approximately 125 associate members who are suppliers to or customers of the steel industry. AISI’s member companies represent over three quarters of both U.S. and North American steel capacity. For more news about steel and its applications, view AISI’s website at www.steel.org.