Premier Wen Jiabao recently chaired an executive meeting of the State Council to study the deployment of measures to rein in overcapacity and duplicated projects in some sectors and guide the healthy development of industries.

The meeting pointed out: In order to cope with the impact of the global financial crisis, the government has, since the beginning of this year, mapped out plans for the adjustment and revitalisation of key sectors in accordance with the overall requirement of “boosting domestic demand and adjusting the industrial structure to sustain growth” and announced a series of policies and measures to boost structural adjustments, such as controlling total economic output, eliminating backward projects, encouraging mergers and reorganisation, and promoting independent innovation. These policies and measures have produced initial results. The difficulties facing enterprises in their production and operation are beginning to ease, and industrial development is progressing well on the whole. However, some sectors are making little progress in their restructuring and problems of overcapacity and duplicated projects remain serious. Traditional industries with overcapacity, such as iron and steel and cement, are still expanding blindly. Even new industries like wind power and polysilicon are showing a tendency of duplication.

At present, more guidance should be given to the development of the iron and steel, cement, plate glass, coal chemical, polysilicon and wind power equipment industries.

First, strictly control market access. Measures shall be taken to strengthen the management of project examination and approval in sectors with problems of overcapacity, such as iron and steel.

Second, strengthen environmental monitoring and control. Greater emphasis shall be put on environmental impact assessment (EIA) in regional industrial planning, and such assessment shall be taken as the basis for the acceptance and approval of EIA documents for high energy-consuming projects in the region.

Third, supply and use land strictly in accordance with law. Land use approval shall not be granted to projects that do not conform to the government's industrial policy or land supply policy.

Fourth, strictly implement a financial policy that entails both support and control. Loans shall be granted in line with the plan for the adjustment and revitalisation of key industries and relevant industrial policies.

Fifth, establish a system of information dissemination. A system for the joint release of information by several departments shall be established, and measures shall be taken to strengthen the unified monitoring of the production capacity and capacity utilisation rates of different sectors and release information on matters such as industrial policy guidance, industry scale and social demand in a timely manner.